Parker Pen has gone back to its roots of crafting fine writing instruments as luxury consumer symbols. Are there any new emerging markets that they can focus on that have a similar culture of writing or gift giving?
There are different untapped markets such as China and European markets could increase the market share of Parker Pen. Some of the important aspects regarding the branding shift of Parker revealed by assessing the case study are that the focus of the company has transferred to expensive luxury products by removing the entry-level pens from the market. There are some of the emerging markets where there is a similar level of the culture of writing and gift giving. But the important aspect for expansion of business in emerging markets is that the company has to consider that income and wealth of people are rising creating a huge proportion of Middle-class customers in both the existing and emerging markets. In response to the question, the first important aspect to understand is the reasons for gift giving in different countries.
The main reason for giving a gift to others is a sign of thanks and appreciation. Gift giving has become very popular in different countries around the world. The significant aspect regarding gift giving is that it is more popular in those countries where cultures are high contexts. Philippines, Japan, Columbia, Kuwait, Taiwan, Indonesia, Russia, Korea, Poland, India, and Argentina are some of the high context cultures and it means that gift giving is very popular in these countries. In case of considering emerging markets for Parker Company, it is important to identify those emerging markets where luxury consumption rate is high. It is noted that the growth of social media and the internet has converged the preferences and taste of people due to which the luxury consumption rate has increased in countries like Russia, Thailand, Turkey, Brazil, Malaysia, and India. It has been evaluated that about 85% of luxury retail stores will be opened in these emerging markets within the next decade. There are three important emerging markets of high luxury consumption that could increase the market share of Parker Company (Shukla, 2012).
India
Luxury industry in India is representing 1 to 2%, but the luxury consumption rate in the country is showing promising growth. According to India Wealth Report 2016, it is noted that in the context of some billionaires in the world India ranks in third and it ranks seven in the world in the context of individual wealth. It is the reason that the luxury market of India has grown and by the end of 2016, it is found that the estimated sale of luxury goods has reached 18.3 billion USD.
The Indian market could increase the market share because there is a high potential for luxury pens. The only thing that should need to be focused by the Parker Company is to make careful strategic decision making because it is also observed that the tricky thing to justify a luxury footprint in India, is finding the right location. In India, it is observed that people considered a writing instrument as a novel gift. The Parker Company can attract the customers in India by creating a luxury style because the style in the luxury items in India is accepted rapidly. Gift giving in India is based on the sensitivity that means the presentation matters in India. The key point that can increase the market share of Parker Company is the consideration of diverse occasions in India because most of the Indian people give gifts on these particular events like Hindu Diwali Festival in October and November (TextMaster, 2017).
Mexico
It has been seen that Mexico is considered one of the top emerging markets for the luxury industry. Therefore, the expansion of business by Parker Company to Mexico can also increase the market share. Rapid expansion of the middle-class of the country has been witnessed since the economic and financial crisis of 2008. The growth of the economy has converted the people to use luxury products. It has been seen that by the end of the year 2016 there was a 6 % increase on spending of people on high-end products. There are different luxurious brands to attract new customers in the country, and there are high-end shopping centers established in the country by international brands to accommodate the people to increase the brand image and market share (Roberts, 2017).
Thailand
Thailand is one of the countries that are offering plenty of benefits to the luxury industry. The luxury writing culture and gift giving are famous among the young population of the country. It has been seen that the middle and upper classes of Thailand are considerably young which is good for the company to expand business in this country. According to the report presented in 2014, it is observed that 20.5% of the people in 30 to 34 age brackets declared over 150,000 USD annual incomes. There are some important qualities in the writing culture of the country that made it top South Asian market in the luxury industry and context of spending of people on luxury items. It has been found that Thailand is beyond Philippines, Indonesia, and Malaysia by spending money on luxury items for example spending on luxury item in Thailand has increased to 2.5 billion USD in 2014 (Umpujh, 2018).
In the end, it can be concluded that there is a bright future of usage of luxury pens in these emerging markets. There are cultural differences and difficult current climate in a couple of emerging markets, but the luxury industry will grow in coming years. Parker Company has greater opportunities to expand its business in these emerging markets.
References
Roberts, F. (2017, Feb 22). Mexico Bucks Emerging Market Trend but Outlook Remains Uncertain. https://www.luxurysociety.com/en/articles/
2017/02/Mexico-bucks-emerging-market-trend-outlook-remains-uncertain/
Shukla, P. (2012). The influence of value perceptions on luxury purchase intentions in developed and emerging markets. International Marketing Review, 29(6), 574-596.
TextMaster. (2017, Jan 19). 3 Emerging Markets to Watch in the Luxury Industry. https://www.textmaster.com/blog/3-emerging-markets-luxury-industry/
Umpujh, S. (2018, March 20). Room for growth in Thailand’s luxury good segment. https://oxfordbusinessgroup.com/analysis/lap-luxury-already-one-region%E2%80%99s-largest-luxury-goods-markets-sector-slated-additional-growth
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