Saving a Pen Brand: a Case Study of the Kaweco

Intro

I love my vintage Kaweco V14S from the 60s. Being a compact pen, it features a resin-casted black body with a blue transparent ink window, a piston filler, a stainless steel matte finished cap, and a semi-flexible gold nib. All the specs needed for a flagship pen at the time are presented, and this is indeed one of the perfect Kaweco pens. My initial plan was to simply preserve it well, the same way I treat my 70s’ Hero-100. Normally when their original factory vanished along with old-time spirit, who knows when can those legacy brands manage to bring it all together again?

 

However, recently this pen has been inked for it suddenly occurred to me that this brand is in its heyday. The new Kaweco brand, revived by Michael Gutberlet, is back into the game seriously, with new models, new luxury items, and new events popping up here and there. I am happy to see the emerging new era of Kaweco pens, premium models included.

The purpose of this article is to summarize major events for the Kaweco brand in its early days and discuss its corresponding business decisions. As for the source of information, industrial publishings, press releases, and reports related to this topic are used. Moreover, one personal experience during a panel with Mr. Michael Gutberlet, the man behind the new Kaweco, provides first-hand information on the topic.

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Chapter 1: The H & M Gutberlet 

Though this article is about the new Kaweco brand, I have to point out in advance that the actual object we are dealing with is not an individual pen company called something like a Kaweco Pen Co., which doesn’t exist. The original Kaweco closed in 1980, and then from the late 80s, H&M Gutberlet GmbH, a company that majored in manufacturing pen parts for decades, began buying up the remaining assets of the insolvent company. The H&M Gutberlet kept pursuing and expanding its other business units even after finally got the brand Kaweco in the mid-90s, and today the company is still regarding itself as one of the “community of (pen) components.” The community for components – gutberlet. In another word, what we perceive to be the Kaweco now is actually a private label or a business division of a long-time manufacturing company in the pen business.  Knowing this fact is essential for us to understand its recent development better.

One important figure we can not skip in this journey is Michael Gutberlet, then one of the managing directors of the company. Michael ignited the upsurging interest of collecting vintage pens (including Kaweco pens) among his family in the 80s. During one of the fans event he attended last year, he humorously recalled that his family acquired an extraordinarily large number of vintage Kaweco pens in the late 80s, and he owns around 2000 of them. “My wife was somewhat angry with me, and I was wondering whether I can do something with this beloved brand,” Said him during the event.

However, the passion itself cannot explain the rationale behind the scene. According to a Pen World Magazine article, during the 90s, Gutberlet found “his pen parts manufacturing business wasn’t doing very well because many pen makers were either ceasing production or outsourcing production to cheap-labor countries.”

To stay in business without a drastic change of labor force and business style, one solution for a company like them should be operating a pen brand themselves. In the lens of the classic value chain theory, this is a brilliant idea: instead of competing with Asian counterparts by supplying parts to pen makers using expensive labor force, making and selling products under one brand would give some of their profit margins back. In this case, the chance to win back is even higher since basic supportive activities needed were already there and well-practiced, such as the manufacturing infrastructure, a labor force with the pen expertise, and the industrial relationships.

Chapter 2: Formulating the New Kaweco

In a news release, Mr. Gutberlet recalled by the time that his family was “looking for an opportunity to expand our programme” and “looked at the situation as a chance to redevelop Kaweco.” And the Gutberlet family decided to buy the brand in the year 1992. However, it would be another four years before they finally got the brand’s worldwide rights. In the case of legacy brands, the difficulties one may encounter during the negotiation with its assets owner could be mind-boggling, think about the recent case of the OMAS. However, the Gutberlet family did not waste the waiting period–they go straight to deal with the single most demanding question what product to make for this brand, after over ten years of silence?

By the time, the pen industry is different from the 70s, thanks to the adoption of new types of communication technologies. Even if the brand’s reputation stands among the customers, a strategy to make gold pens with the best material and craftsmanship (like what they did in the old days) simply won’t work. Though some legacy brands sorted out that addressing ornamental value and brand history could maintain the status, the best example of which should be Mont-Blanc, for a small company like the H&M Gutberlet, they just lack the necessary capital and status to roll out the new Kaweco in a similar style.

Adding another stratum of complexity to the brand positioning is the family did not want to transform the whole business into running this brand only. Looking into the company’s online catalog, it is highly possible that the H & M Gutberlet has been doing some metalworking jobs for brands like LAMY and Pelikan for years.Therefore, the new Kaweco brand should not hurt their existing relationships with major customers, the pen makers, which were still the biggest cash cow of the business.

The answer to the tricky situation: “to replicate the 1935 version of the Kaweco Sport model,” a product emerged from the 1911 Sport-Series and was institutionalized in the 30s. For a writing brand that dates back to the 19th century, so many themes and models were available to choose, ranging from the first safety pen patent (1908) to the pioneer of cartridge filler (1900, the original Perkeo). Despite all the amazing threads left by the brand, the Sport was chosen for reasons. One is for its roles in the old Kaweco production for it enjoyed a long time of production, the other is the special potentiality for its portability in the new era of communication, which was evidently stated in their final product.

As early as 1993, the H&M Gutberlet GmbH finished their answer to position the new Kaweco: a cheap injection molded pocket pens that look identical to the original Sport. New trademarks were registered for each model, which is understandable from the point of respecting the intellectual property. However, the naming of those trademarks was intriguing–Trekking, Ranger, and Yacht. Since they are not the first product launched under the new Kaweco, it would be wrong to take them as the first one in the modern Sports lineup; for the sake of discussion, I would rather call these two models the Beta Sport altogether.

Despite the Kaweco’s claim in their slides that these three pens are the first product of the new Sport line, it is not hard to find that they are individually labeled in different trademarks without neither ’Sport’ nor ‘H&M Gutberlet’ imprints.

How many sets of the Beta Sport circulated at the time is unclear, but what is clear is that they reflect the fundamental product philosophy of the upcoming new owner of the Kaweco brand.

In essence, the Beta Sports share the basic design and material with the entry-level Sports pen on-sale today. While keeping a similar look as vintage models, the pen offers no clip by default.Underneath the body, a standard Schmidt stainless steel nib unit fitted only with a cartridge replaces the 14-k gold nib that worked elegantly with old-time piston filler. Even the body itself is injection molded with noticeable joint lines left on the surface rather than being carved out from a rod of celluloid or hard rubber. Today’s plastic Sport pens are using basically the same formula. All these attempts served one goal: cutting the cost as low as possible.

 

A Set of Ranger Pen | Photo Credit: Stephen B.R.E. Brown

Meanwhile, the presentation of the Beta Sport models told us even more about the intention in the shadow of the relaunch project. One offer contains a leather pouch carrying the whole lineup of the pens, along with a mini flashlight! The carabiner attached encourages the user to link it with belt or bags, making it one part of everyday gears. A detailed review of this model by Dr. Brown could be found here. Whatsmore, In their marketing material, various occasions in which those little pens come handy to their young and affluent owners were illustrated in a jocular style.

Thus, the initial plan made by the Gutberlets was not hard to guess: these new Kaweco pens would no longer be the same fine writing instrument which deserves good treatment as well as a premium; instead, they should be the daily tools built to be tossed around. In today’s business school jargon, such strategy falls perfectly in line with the Blue-Ocean thinking: instead of steering the company into the bloody, head-to-head competitions, one should look ahead of the traditional market threshold and try to occupy vacant market positions. To achieve such a level of competitive thinking, the Gutberlets were probably quite confident about its cost structure and the value propositions welcomed by the consumers. More specifically, by leveraging their manufacturing resources to make a product look alike but cost only a fraction of the original model, they wished to make their new Kaweco pen to be classic in look, fairly good in quality, entry-level in price, and most importantly, young and sporty. It was a brand positioning rarely used by other pen makers.

So brilliant was this idea that even before the Gutberlet family could roll out the products themselves the owner of Diplomat placed an order of 150,000 units of the new Kaweco Sport.

Chapter 3: The Diplomat Deal

However, along with the big Diplomat contract also came the provisions that Diplomat will be the exclusive distributor of the new Kaweco pens, and the pens will be correspondingly co-branded with Diplomat.

Though via this deal they got the access to the distribution network of an established German brand, they also lose some control over some of the critical elements they planned for the new Kaweco. By walking through the product specifications in details, it would be clear that the gains from this collaboration cannot make up for the loses.

The product suffered a twist that degenerates it into something more like a typical Diplomat offering, derailing from its initial planning. The brightly colored barrel in the Beta Sport got replaced with traditionally-styled ones. On the barrel of the pen, the model name was branded in an uncanny upper case “Kaweco® SPORT” rather than what we see as a “Kaweco Sport” today. (It will be bizarre to see Apple market its phone as IPHONE). In addition to the Kaweco brand, in a new line nearby, a big “by DIPLOMAT” co-branding occupied almost the same space. As for the packaging, a different style replaced what we see in the Beta version with an outdated one. Besides the pervasive upper-case-spelling around the package, your eyes would certainly rest on the mustard square in the Kaweco badge. Somewhere below when it has some gap, it would print a slogan in German that means “The new generation of a classic” along with an English one–“Tradition made in Germany.” Tradition and solemnness seemed to be the central theme here, despite the fact the product was still a super cheap cartridge only plastic pen.

The product and branding sacrifice here didn’t lead to an impressive sales number, and the new Kaweco was also not no longer committed to this deal after their partner went out of business in 1999. According to the Pen World Magazine article mentioned before, the company suddenly found itself helpless in distributing after the pass-away of Diplomat’s owner and began to learn to establish their own network. However, that is only one part of the story, in reality, a burst of new models was rolled out by Kaweco in the same year, among them even exist a super complicated limited edition made by Visconti. It is highly probable that the Gutberlet family was not fully satisfied by the Diplomat deal and was prepared for the date of being fully autonomous.

Chapter 4: Relaunch

When we sat in a bookstore in Shanghai during a fan meeting last year to talk about the stories behind his company, Mr. Michael Gutberlet revealed what he did after the time when the Diplomat deal went afoul. A combination of holistic product, marketing, and sales strategy was inevitably needed during that time, and they slowly got it right, first from a brand new line-up of competitive offerings.

On the verge of the breaking down of their Diplomat deal, the development of various types of the real new Kaweco Sport pen may have already been well executed. In an early press release, the company stated that “Gutberlet’s manufacturing expertise and industry relationships made it possible to rapidly expand the product line to include a variety of luxurious pens.” The year 1999 and 2000 witnessed the birth of two popular models that we still have today: Classic Sport, featuring solid color barrel and gold trims, and ICE Sport, feature colored transparent barrel with silver trims. The back Guilloche-patterned Classic Series, which was preferred in the Diplomat deal before, was re-assigned to the retail Manufactum exclusively in 2000. Also, a premium green celluloid limited version made by Visconti for Kaweco was made for CAS (Collegium Ars Scribendi, a German collector club). This CAS version combines all the luxury you can fancy in a vintage Sport: marvelous body material, piston filler, bi-color gold nib, all came with a hefty price tag. For all these models, the current Kaweco logo was introduced, along with the right way to spell the model name Sport, only with ‘s’ in upper case.

To summarize, while covering both its previous consumer base during the Diplomat area, the new Kaweco’s product lineup managed to iterate to its initial intention, along with an intriguing idea to make a super luxurious limited model. As years went by, it became a pattern for the company to keep this double-track product strategy and refresh roughly every three years, for a more detailed list of models please see the FIG.1 below.

                  Standard                       Premium 

1999 & 2000  Classic Sport， ICE Sport|  Collegium Ars Scribendi

   2003      AL Sport, Laquer Series  |  ART Sport 

   2006                               |  King 

2009 & 2010  Classic Chess,  AC Sport | Sport Luxe，Combimatic 711

   2014                               |  Eyedropper 1910

 FIG.1 

However, it was not an easy task to sell them. In 2004 and 2005, when trying to drum up interest among fountain pen sellers, they were still encountering problems caused by “the low price of the Sport.” What happened was the low-price tags on the normal Sport pens took salesperson extra effort to persuade the customers about their uncompromised quality, which “didn’t make it worthwhile for dealers.”

As we can see in the FIG.1, the company understand this side effect from the affordable pricing strategy, as they launch pricier models and limited runs into their portfolio. To offer vastly varied and different value propositions under the same model name to different groups of consumers has been proven to be a successful practice by German automakers. Like what happens when people buying a German sedan, a normal pen buyer who wants to have a legit and reliable everyday pen that suitable for mild use would be happy with the basic offer, and a pickier customer would pick up something made from better material, such as an AL or AC Sport, and real aficionados would pursue the fully beefed-up versions which cost significantly more than the basic models, be it an ART or a Sport Luxe.

 

A CAS edition along with a Luxe edtion | Photo Credit: penupman

But aside from elevating their brand by expanding line-up and persuading brick-and-mortar pen retailers, the company did much more to promote the brand. Building up the brand consciousness and partners took time, and simultaneously the new Kaweco figured out to market the product and brand in new ways, selling them through lifestyle stores, presenting them through the internet and cultivate a tight relationship with key opinion leaders.

During the slides he presented in Shanghai, Mr. Gutberlet told the author that despite the lukewarm attitude from traditional selling networks, the company found it quite effective by placing the Sport pens in an apparel store, or a designer store, or even place like an airport. Even today, you can randomly spot a Kaweco product in a metropolitan designer store or on a fashion site such as Zady.com.

At the same time,  the company decided to “heavily relying on the Internet to show off the entire product line and its product heritage.” In their wording, their distribution channel is “a global network with the help of its websites”. If you check the newest version of Kaweco’s website, you will find it is unlike any other pen brands’ site. It functions more likely to be a hub for their key constituency groups: retailers and fans. On its website, you can fill out your application form and log into your retailer account if you want to distribute Kaweco pens, you can also download in full resolution their well-curated product shoots and catalog, covering every single model and also come in a format that suitable for printing. A deeply illustrated history of the brand and the idea behind each product line could take a real fan half a day to appreciate.

Talking about fans, no brand did a better job in working tightly with pen bloggers around the world. Product side, from the ASC version, producing editions themed after target market, often in a limited run, become a normal practice for the company. Here in the states we saw American Purple Skyline Sport, for the Spain they offered an orange Naranja one, for the Asian market they have introduced Lagoon Blue, Rose Quartz, and even a People’s Republic of China version this fall.

Besides, entering the second ten years of the 21^st century, the company began to sponsor several online figures who are influential in the realm of stationery review, and it becomes a pattern for famous pen bloggers around the world to receive Kaweco’s new models for the review proposes. The fan meeting and similar events also growed along the way, varied from panel talk, open-house, to pop-up stores that even enables people to customize the Sport pen of their own flavor.

 

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Endnotes

Years after the relaunch of the new Kaweco brand, the result became promising, by the year 2013, the new Kaweco was sold around the world in 40 nations and areas. The product strategy around their core Sport lines turned out to be a huge success, according to a recent interview, Mr. Gutberlet acknowledged that ever since the 90s, the $20 range Classic Sport has been a No.1 seller for the new Kaweco, with the $70 range AL Sport being the No.1 in case of turn over. If you are fully committed, gold nibs in three different style of finish and a full range of linewidth have been on the market for sale since five years ago. Accompanying those products, without doubt, is a robust customer base around the world.

 

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Though this article is written based on various interviews with Mr. Gutberlet, either in-person or conducted by others, the final view and conclusions are all reflecting my personal opinion.