The Hindu Business Line : ITC expanding notebooks biz as greeting cards decline

FREE e-greetings sounded the death knell for greeting cards and SMS is hastening their journey to obsolescence. So ITC, which markets Expressions greetings cards, is expanding its stationery business.

The total stationery market is estimated at Rs 5,000 crore.

Speaking to Business Line, Mr Chand Das, Chief Executive, ITC's Greetings, Gifting & Stationery Business (GGSB), said the greeting cards industry had declined from Rs 250 crore to Rs 200 crore in the last five years. ITC had 20 per cent share of the market and was "stuck" there, he said, adding that the market players were only taking share from each other. Rather than investing in a campaign urging people to send greeting cards, it made more sense to grow another segment, he said, adding that his division had many plans for the notebooks business. By March 2006, 70 per cent of GGSB's production would be notebooks, Mr Das said, adding that when ITC forayed into greeting cards five years ago, they accounted for 80 per cent and stationery 20 per cent.

The notebooks business is estimated at Rs 3,000 crore and ITC has just a one per cent share of this highly commoditised market. The biggest player is Navneet Publications, whose market share touches Rs 100 crore. The GGSB, which has the mid-range Classmate and premium range Paperkraft brands in this segment, will add a mass market range in early 2006 for which it will leverage the width and depth of ITC's vast distribution network covering rural, semi-urban, urban and metro markets, Mr Das said. This range will be 15-20 per cent cheaper than Classmate, which has 200 variants with prices ranging from Rs 5 to Rs 50.

ITC, which has sponsored the Classmate Young Authors' Contest in the past two years, is now conducting a contest for young artists which will help it connect with more of its target audience, Mr Das said. The competition will debut in the four metros, Bangalore and Hyderabad, and is targeted at students from classes five to eight. Over 3,000 students from 400 schools are expected to participate. The prize-winning stories of the 2004 contest were judged by author Ruskin Bond and published as Post Box No 99 by Rupa & Co.

The Classmate brand was launched in 2003. It is environment-friendly as the paper is bleached without elemental chlorine, a technology currently exclusive to ITC which has its paper plant at Bhadrachalam in Andhra Pradesh. ITC contributes Re 1 from each Classmate notebook sold to its rural development initiatives, which include primary education. The Paperkraft brand is targeted at college students and executives. Prices go up to Rs 150 for a 400-page notebook.

Besides greeting cards, the GGSB markets calendars for the SOS Children's Villages of India for institutional sales, which account for 20 per cent of its business. It has no plans to move into the general market, though. Besides notebooks, it markets a few other stationery products such as bookmarks, autograph and pop-up books.

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page