Strategic Marketing for Clique Pens: Balancing Retailer and Consumer Focus

Currently, Clique pens find themselves in a challenging position as they compete with other well-known pen brands like BIC, Scripto, Pentel, Pilot, Papermate, and Sharpie. The battle for shelf space is fierce among major retailers such as Wal-Mart, Target, CVS, and Kroger. Due to the significant influence that retailers wield in this market, companies like Clique must carefully allocate their resources to ensure they remain visible on store shelves. Pens are considered high-profit and high-turnover items, which is advantageous for retailers.

However, manufacturers are experiencing diminishing profits as retailers have maintained the same prices for nearly a decade. The abundance of brands available gives retailers the upper hand, as they can easily switch to a different brand if one fails to perform. To stay profitable, Clique's brand managers have collaborated with various marketing and advertising agencies to create a comprehensive strategy encompassing advertising, trade promotions, and consumer promotions.

Clique has divided its total promotional budget, allocating 15% to advertising, 30% to consumer promotions, and 55% to trade promotions.

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The company utilizes consumer promotions and price-off deals through retailers, often featuring phrases like "available at Target" in magazine ads. Consumer promotions primarily involve distributing coupons through newspapers, in-store displays, and cash register receipts. However, the redemption rates for these coupons are disappointingly low, approximately 1.3% lower than the average for other consumer products. Elise Ferguson, the president of the writing implements division of U.S. home, faces a crucial decision regarding whether to focus the company's marketing efforts on retailers or consumers to drive Clique's profits.

One potential strategy for Clique is to shift its marketing focus towards consumers rather than retailers. Logan Chen, the vice president of marketing, advocates for reducing trade discounts and implementing a consumer-oriented Market Development Fund (MDF), along with additional consumer-targeted marketing initiatives. Conversely, Ross McMillan, the sales vice president, strongly opposes this approach.

If Clique were to reallocate a significant portion of its sales and marketing funds towards consumers, the company risks losing valuable shelf space and sales to competitors due to reduced marketing support. Moreover, consumers in this market exhibit minimal brand loyalty, making them less responsive to advertising efforts. Additionally, the low coupon redemption rates, which are 1.4% below the industry average, indicate that the current advertising strategies may not be effective. Pursuing this option could prove costly and perilous for Clique, potentially jeopardizing their presence on retailer shelves.

Considering the challenges and opportunities in the pen market, Clique must carefully evaluate its marketing strategies to enhance brand visibility, drive consumer engagement, and ultimately boost profitability. By implementing a well-rounded approach that balances retailer and consumer-focused initiatives, Clique can strengthen its position in the competitive landscape and secure long-term success.

References

• BIC
• Pentel
• Pilot
• Target
• CVS
• Kroger
• Wal-Mart