Grey worldwide Strategic Repositioning through CRM

STRATEGIC REPOSITIONING THROUGH

CRM

Who is GREY Worldwide?

BACKGROUND?

Grey Group is a global advertising and marketing  agency with its 16 global partner companies focused on different communications discipline and it’s global partners include:

APCO Worldwide

Beyond Interactive

Elemental Interactive

G2 GCI

Grey Direct

GDMI

Alliance

Grey Interactive

Grey Worldwide

G WHIZ

J. BrownMediacom

VCG

Grey Healthcare

Wing Latino Group

These companies are engaged in a wide range of marketing and communication activities as shown:Alliance Creating Global Alliances between brand companiesAPCO Worldwide Specialises in Public affairs and major corporate issuesBeyond Interactive Customer acquisition and customer retention Elemental Interactive Global interactive communications firm G2 Brand communicationsMediacom Creates media solutions that build businessGrey Direct Business marketing to individuals and other businesses.Grey Directory Marketing, Inc. Specialises in yellow pages and other specialised directory mediaGrey Healthcare Healthcare marketingGrey Interactive Interactive marketing services in support of businessGrey Worldwide Highly creative solutions to marketing problemsG WHIZ Understanding the youthful mindset of today’s consumerJ. Brown/LMC Group       Helps in companies budgets through retail partnershipGCI Global public relations agencies practising brandmarketingVCG Specialises in investor and marketing communicationsWing Latino Group provides full-service capabilities in advertising, media

The GREY Global group serves:

What was GREY Worldwide Hong Kong and China?

Who was Viveca Chan?

Grey Worldwide Hong Kong and China was established in 1978 as part of the Grey Globalnetwork, focusing on “communications” as

its core business and following eight principles toprovide client services.

Viveca Chan, CEOof GREY Hong Kong and China

Grey Hong Kong started as a small agency, and delivering integrated marketing expertise wasits core strategy.

GREY GLOBAL’S EIGHT PRINCIPLES (PROMISES)

Promise 1: We provide clients with an experienced and consistent team.Promise 2: We promise true partnership attitude.Promise 3: We apply strategic knowledge and disciplines to add value.Promise 4: We consistently deliver high quality services.Promise 5: We leverage global ‘best practice.’Promise 6: We fight for the best prices for our clients.Promise 7: We create ideas that sell.Promise 8: We turn your brand into a showcase of success.

Grey Worldwide’s (or Grey) Asia strategyfocused on building partnerships with local agencies and developing local management talentto allow quick recognition of indigenous opportunities.

This communications strategy proved successful for Grey WW-HK/China as evident :

Grey had already developed a strong brand in the

marketplace; however, it had to build a customer knowledge base to enable customer relationship management.

Why is GREY WW-HK/ China in trouble?

What are the challenges GREY has to face?

A Changing Media Industry

Integrated marketing

Need of CRM

In the 80s, Grey WW-HK/China concentrated on brand-building and management by 2001 the focus was not simply brand management, but now involved customer management as well. Therefore, Grey WW-HK/China needed to manage brand equity as well as customer equity. Grey had already developed a strong brand in the marketplace; however, it had to build a customer knowledge base to enable customer relationship management.

Three overarching trends were pushing communications companies to focus on improving their client attraction and retention processes :

The Media Market in 2001

Increased competitionNew technologyRising customer expectations

Increased competition

1

Due to this increase in competition

“Marketing and advertising industry players were faced with constant marginsqueezes; between 1988 to 2001, commissions had fallen from a standard of 15 per cent to aslow as two per cent of sales.”

2

Media and Internet CRM Technologies

Advancement in technology led tosome E-MARKETING customisation tools

3

Rising customer expectations

A concurrent trend driving industry change was rising customer expectations; this meant thatagencies had to refine their ability to identify and serve their “best” customers – and create loyalcustomers. As a result, previously ad hoc and fragmented techniques for dealing effectively with customers were giving way to a more methodical CRM approach:identifying, attracting and retaining the most valuable customers in order to sustain profitablegrowth.

The changing media industry led to adoption of CRM as shown

Actually what is CRM

Customer relationship management (CRM) is an approach to managing a company’s interactions with current and future customers.CRM can help companies manage customers better, and subsequently secure more new clients

The research found that CRM performance accounted for 50 per cent of the variance in communications companies’ return on sales. Therefore, 50 per cent of return on sales could be directly attributed to CRM activities (sales, service and marketing), while the other 50 percent was not related to CRM .

EVIDENCE

Another big challenge for GREY was

the rise of CRM industry in Asia

“The market size for Asia-Pacific isn’t yet close to growth in the US. We can say the market size for Asia-Pacific is less than eight per cent of the US; although its growth rate is almost 200 per cent – even faster than the growth lines we saw in the US two years ago.” - James Vogtle, CRM Industry Expert

Asian markets began to understand the importance of CRM. Primarily, the interest was led by traditional customer management economics. It cost the industry five times as much to acquire a new customer than to retain an existing one ; therefore, building long-term and sustainable customer relationships was a good strategy, from the point of view of both building life-time value relationships and the business cost savings involved

Importance of CRM in Asia pacific

EVIDENCE

Now, the GREY WW-HK/China and Viveca Chan were facing following challenges:

How to tackle a dramatically changing industry cost structure where there was downward pressure on profit margins

Management knew Grey had strong brand equity, but it needed a renewed marketing focus to sustain competitive advantage.

How to attract and retain high-calibre talent, since agencies were pressured to cut costs

How did GREY WW-HK/China respond to the present scenario?

GREY Worldwide Hong Kong/China adopted two things:

E-Marketing

GREY Relationship Management

Grey Worldwide Hong Kong and China: e-Marketing Strategy

Viveca Chan was pushing her Company to identify where its strengths lay , what traditional business resources it could leverage, and what new media tools it could use to redefine customer value in the face of dramatically changing market conditions.

Grey Worldwide Hong Kong and China: e-Marketing Strategy

Viveca Chan was pushing her Company to identify where its strengths lay , what traditional business resources it could leverage, and what new media tools it could use to redefine customer value in the face of dramatically changing market conditions.

Since Asians were new to the technology Viveca Chan felt that certain Asian specificities needed to be recognized :

•Asian consumers needed to be educated in e-business and enabling technologies• The Asian market was more fragmented in its CRM needs• The strategy, execution and knowledge mix in Asia would differ

•Asian consumers needed to be educated in e-business and enabling technologies• The Asian market was more fragmented in its CRM needs• The strategy, execution and knowledge mix in Asia would differ

HOW?

E-Marketing was a new Technology for Asians, so they needed to be educated about the technology.

For that purpose GREY should conduct campaigns in which there volunteer shall teach about the Internet and technology by making people manually use the computers that has enabled Internet. For a maximum of 5 people, there should be one GREY’s volunteer. Asians are happy to learn the things so there will be a good response.

They can arrange road shows explaining to people what actually e-marketing is and why it Is necessary?

STRATEGY

Successful CRM implementation, according to Viveca Chan, hinged on a company’s ability to execute a strategy with the right market knowledge; she felt no such player existed in the market yet . Despite cost pressures, though, Grey WW-HK/China decided not to compete on price; instead, it would differentiate itself through a CRM proposition – the GRM concept. To become that player, Grey WW-HK/China viewed its Asian challenges in two specific ways: by managing knowledge and by executing strategy through managing technology.

Managing KnowledgeKnowledge is information gathered on customers through various events and media. Sharing customer knowledge is our biggest future asset. Our main challenge is how to develop a system to build “customer equity”. In addition to “brand equity”; customer management has become key in this business . This means managing the multiple customer contact points, managing CRM. -Theresa Franklin

The existing customer data and customer knowledge residing in Grey’s specialised companies provided tremendous opportunities for knowledge integration, creating not only a single customer database (that was easy to catalogue and retrieve using the modern systems), but also a system that collected hidden knowledge in existing data. This “database” or knowledge base captured Grey WW-HK/China’s biggest asset and helped in segmenting customers, predicting loyalty and analysing market needs.

Managing Technology

Technology is part of our total communications process, but not necessarily part of our strategic processes. It is part of sharing information about our clients, enhancing our business efficiency and as an alternative for traditional media in building media presence on-line. Our focus is still our brains. - Candy Wan, Director of Grey Direct

In particular, Beyond Interactive’s competence – educating consumers and unique understanding of gathering data, optimisation , among others in the front-end as well as the back-end of using the Internet – was fundamental to Grey WW-HK/China’s new CRM focus.

Viveca Chan’s final thought on Grey WW-HK/China’s e-marketing strategy was:

Viveca Chan’s final thought on Grey WW-HK/China’s e-marketing strategy was:

“Strategy is strategy. "e" is part of it now, but there is no change in fundamentals! "e" is just a tool for us to change brand experience.”

GRM: Strategic Repositioning through CRM

The GRM concept was a four-principle philosophy developed with a specific customermanagement focus:

1. Build brands2. Develop and manage customers3. Create a positive brand experience for clients4. Build brand through knowledge about the customer through constant dialogue

Grey WW-HK/China’s tools for implementing the GRM concept were two

proprietary products – “Brand Futures+” and “GRM Charter”

Brand Futures+ targeted companies that had traditional marketing needs: defining and building brands. Brand Futures+ tapped a partner or a group of Grey’s partners, such as specialist marketing and communications companies, to create personalized strategies to meet clients’ needs. For eg:

GRM Charter catered to the needs of companies who had strong marketing and brand strategies in place and wanted to develop a customer relationship vision and plan. GRM Charter could build an integrated plan that involved the participation of all of Grey’s global talent. For eg:

Grey WW-HK/China would need to operationalise adopted CRM processes for all employees at all levels of the organization

Grey WW-HK/China would need to operationalise adopted CRM processes for all employees at all levels of the organization

HOW?

The operation for adoption of CRM processes for all employees at all levels of organisation should be well managed.

There should be well trained Managers at each level who works as a team leader for his team.

GREY should get their employees trained by present CRM Experts.

GREY shall conduct competitions between the employees so that they learn faster and better.

How shall GREY attract customers and retain them?

GREY shall attract customers by offering lucrative deals.

GREY can retain it’s customers by making them feel privileged by organizing events for it’s clients.

GREY shall Reward Loyalty of it’s customers.

RECAPWho is GREY Worldwide?

What was GREY Worldwide Hong Kong and China?

Who was Viveca Chan?

What are the challenges GREY has to face?

How did GREY WW-HK/China respond to the present scenario?

• GRM: Strategic Repositioning through CRM

• E-Marketing Strategies

Thank You

Disclaimer :Paras Arora

H.B.T.I. Kanpurduring an

internship by Prof. Sameer Mathur, IIM

Lucknowwww.iiminternsh

ip.com