Case study - Grey Worldwide

Strategic Repositioning Through CRM

• Established in 1978

• Part of Grey Global network

• Grey Global Group is a full communication enterprise with 16 global partner companies.

• Focus on “communications” as core business

• Its Asia strategy is focused on building partnerships.

• Core strategy: delivering IMC

• Approach: To deliver the most cost effective client service approach which is integrated marketing.

General Overview of the company

Viveca Chan,

CEO of Grey Worldwide HK/China

Chaotic media and communications market conditions and downward industry pressure on

commission margins FORCED Grey Worldwide

Hong Kong and China (Grey WW-HK/China) to conceive a CRM philosophy called Grey Relationship

Management (GRM) in 2001, to REPOSITION itself through defined e-marketing and CRM strategies for the Asian market.

Asian market are more complex than

markets in US

Agencies in Asia are expected to do Everything Customer interaction, advertising, design and even public relations

This led to the concept of Integrated Marketing Communication. Grey WW-HK/China followed IMC

concept in 1980s when they begin their operations in Asia.

But Media Industry Changed rapidly from 1980 to 2001 causing evolution

of the marketing philosophy

Major changes include: Fierce Competition

New technology leads to new effectively competing business Models

Rising customer expectations

Increasing cost of acquiring new customers

Changing in the communications industry from generalization to specialization

Pure online companies are able to produce competitive high quality products at lower prices

Strong price pressure

CRM Industry in Asia

• The Asian CRM market was relatively smaller, but high growth rates were expected than in North America.

• Asian markets began to understand the importance of CRM as it costs the industry five times as much to acquire a new customer than to retain an existing one.

• Industry specific and fragmented market for CRM needs

• Building long-term and sustainable customer relationships was a good strategy.

• Strategy, execution and knowledge mix differed from that of Europe and America

• Asian consumers lacked education in e-business and enabling technologies.

• A very less portion of IT investment was channeled to supporting technologies and enabling functions (CRM).

206

351

501

716

APAC CRM Market Growth(in $Mn.)

2000

2001

2002

2003

CRM Industry in Asia

Objectives of Grey WW-HK/China

An initiative to give the agency a more holistic approach to advertising.

Leverage all touch points to build both brand equity and customer equity.

Creation of a single customer database or knowledge base from existing customer data and customer knowledge residing in Grey’s specialized companies.

The main goal was an integrated approach to create , identify , evaluate , capture , enhance, share and apply Grey’s intellectual capital.

Traditional business assets Grey WW-

HK/Chinas can relay on

“Grey” is a known name which they can use in building

relationship and trust

Can use brand name to build relationship with major service providers in Asia-Region

Can attract talented human capital to run the operations & strategy

Brand Equity

Grey can use its huge customer database by integrating it to create a single customer

profile

Knowledge integration of business customer by

proper segmentation

Customer

database Grey is having technology teeth which they can use to integrate the customer information from multiple touch point to a single profile to provide holistic view about business and customers Technology can be used to create a cost effective marketing

campaign

Technology

3 forms of assets

In the 80s, concentrated on brand-building and management But by 2001 the focus was not simply brand management, but now involved customer management as well For that it had to build a customer knowledge base to enable customer relationship management.

Grey WW-HK/Chinas Strategy changes according to market

This change led to the creation of a CRM

philosophy called Grey Relationship

Management (GRM)

GRM was an initiative designed to give the agency a more holistic approach to advertising in the new world order. It was a move considered ahead of the expected convergence of new and traditional media.

Strategy of Grey WW-HK/China

Do not compete on cost with competition

Build a better, efficient and cost effective CRM strategy

Reposition with defined e-marketing

Data mining and customer profiling as key focus area

To Differentiate from competitors through CRM preposition

CRM in Grey’s Context

• An initiative designed to give a holistic approach in customer management

• ‘Integrated marketing’ approach:

• From ‘Generalization’ to ‘Specialization’

• To create, identify, evaluate, capture, enhance, share and apply Grey’s intellectual capital

• A broad concept involving both hardware and software

• 4 point philosophy for customer management focus • Build brands • Develop and manage customers • Create positive brand experience for customers • Build bran through knowledge about the customer

through constant dialogue

Development

• Data mining and customer profiling are key areas in Grey’s CRM strategy

• CRM implementation tools: ‘Brand Futures+’ and ‘CRM Charter’

• Integrated Marketing Approach with Technology as enabler to support the functional groups

Operational Actions

• Use of Existing database: customer segmentation, market needs analysis

• Movement of senior executives to parent company

• New structure used by CRM charter to serve targeted clients

• Grey’s companies benefitted from their wisdom and experience

Knowledge

Strategy Execution

Traditional Consulting

Firms

Local Firms

Multi Nationals

Ideal Positioning

Grey Worldwide

Grey WW HK/China’s CRM Implementation

GRM Philosophy

Integrated approach to create, identify, evaluate, capture, enhance Grey IP

Institutionalize key processes and strategies that are developed through customer interaction

Change management through making people part of building team for GRM philosophy rather than adapting to it

Cross functional skill development for team

Grey Relationship Management

Build brands Develop and

manage customers

Create a positive brand experience for

clients

Build brand through

knowledge about the customer through constant dialogue

GRM Framework

GRM Charter: Targets companies that has strong marketing and brand but want to develop the CRM vision and Plan

Brand Futures+: Target companies that had traditional marketing needs

Result • Strong brand • Continuous brand

building knowledge about costumer

Result • Satisfied customers • Continuous brand

building knowledge about costumer through constant dialogue

How Should Grey Position itself in the Market

Long-term and Sustainable partner

Integrated communication company

Comprehensive business solutions company

Efficient and effective and differentiated

Criteria to measure CRM performance

Brand equity

• Added value the brand brings to the company

• Financial value of the brand

• Market share

• Brand extension

Customer loyalty

• Repurchase rate and repurchase value by customer

• Lifetime customer value

Customer retention

• Retention rate

• Return on customer retention investment

Disclaimer

Created by Kartik Singla, Thapar University,

during an internship by Prof. Sameer Mathur, IIM Lucknow. www.IIMInternship.com