Greatdreams Cartoon Company, who owns Chinese biggest animation and comics producing base, has gained praiseworthy performance in the realm. However, its owner does not satisfy with this only. Wang Jing, its CEO, is now seeking new marketing pattern in new strategic thoughts to build a “Disney of China”.
About Greatdreams Cartoon:
In Nov, 2007, after Greatdreams Cartoon Group has held the share of Sunchime Cartoon Group, the producing volume of Greatdreams Cartoon composes 40% of that of the whole country. Besides, the cartoon series like “Howie and Lanu” and “Adventure of Qiqi Keke” are enjoying high audience rating throughout China, accompanied by related DVDs and storybooks.
Greatdreams has formed an integrated industry chain and its authorized business covers eight big categories. At present, its partners in the toy cooperation are Auldey and Arron Toys.
Chinese retailing market enters a prospecting year
For the Chinese retailing enterprises, the present situation is a good chance. Form 2006, Chinese retailing industry has entered a prospecting year. The CPI index and price of everything are all increasing. In the past, there is an old saying in retailing industry: “salary increases, rent increases but the sales never increases”. It is portraiture of the retailing industry in the past 10 years. But the present macro situation is exactly a good year for retailing industry. The future developing prospect of the Chinese retailing industry is so bright and the present annual sale is about 7,000 billion RMB. Till 2010, the retailing scale is expected to exceed 11,000 billion RMB.
Seeing from the whole retailing industry at present, supermarket is the largest pattern and its increasing speed is the greatest. In contrast, department store is declining globally. Although the performance in China and Asia as a whole is relatively good, it is still facing huge challenge.
Exploit “Blue-Sea” new market
Now the market competition is more and more serious and the retailing enterprises come across many varying degrees of difficulties in aspects of product orientation, industry state and gross interest rate. In this respect, do we still have a unique way to survive and continue to develop? Maybe “Blue Sea Strategy” can give us a good advice.
First we should learn about the difference between “Blue Sea Strategy” and “Red Sea Strategy’’. Many are against the “Blue Sea” strategy, in which only the following words are the most useful: reconstructing market boundaries. And “Red Sea” is to compete in the fixed market like the competition between 7-Eleven and Vanguard. It is fixing itself to compete in the market of food and grocery when no matter you choose a diversity strategy, concentration strategy or cost leading orientation, all is focus on a common angle. But if 7-Eleven jumps out of the orientation of “food and grocery provider” and shifts into “neighborhood service provider”, it has created a possibility of break away from “Red Sea” and entering “Blue Sea”.
Then, how to exploit “Blue Sea”? The first is to traverse the industry to read the market. Before, I really insisted that I am a single retailer of food and grocery. Now let’s jump out of the limit of this industry to see the market from other industries’ angle and make out what it really is. Secondlary, we will traverse different strategic groups within the industry to read the market. Thirdly, to divide the line of the industrial buying groups again. For example, the juice manufacturers may mainly aim at adult market at all time and never think about whether they have chance to enter kids’ market. It is rightly a possible chance of “Blue Sea”. The fourth is to traverse the complementarily product and service to see the market--it is also intercrossed. Fifthly, we can re-establish the industry’s function and emotional orientation. For example, Disney and Greatdreams both regard emotion as their selling of brand. But many enterprises to a large degree depend on function and technology to drive development and only unilaterally pursue high quality and technology. But in fact, the critical core factor of brand is story. How to make sure the orientation of your product is very important. Finally, to traverse time to participate in creating outside trend.
There are two typical examples: Disney and Martha Stewart. Traversing the boundaries between culture and industry, an effective value chain can be formed that one time investment and many time returns. In Disney mode, there are 4 core incomes: 30% from copyright selling, 30% from licensed products, 15% from the theme park and 15% from the internet.
The success of Martha Stewart is very interesting: Martha Stewart is a dancing actress and she had not begun her business until she was over 40. She especially organized party for others and her excellent service won good reputation for her and hence she got the chance to publicize herself on TV. From then on, Martha Stewart gradually formed a business mode of self-development. Martha Stewart now has broken away from party programming company and her company is not longer a simple media unit. It is an enterprise called HOW TO, dealing with family affairs. Martha Stewart now has 4 big business sections: publishing, product marketing through licensing and joint manufacture, internet and TV and broadcast. Among these, publishing is MSLO’s (Martha Stewart Living Omnimedia) core business and TV and broadcast is an important marketing platform of the brand. The product marketing is MSLO’s second important income resource and the internet is MSLO’s new business whose contribution is relatively small but with very huge developing space in the future. The organic combination of these four business sections provides all-rounded product experience to consumers.
From brand realization to content obtaining, and then to goods purchasing, delivering, using and customer service, it is its very important strategic mode.
Greatdreams’ business mode:
The cartoon film “Howie and Landau” which is promoted by Greatdreams has been hot in more than 600 TV stations within the country and the cartoon images have won the nearly crazy fondness and pursuit of hundreds of thousands of children. After that, Greatdreams promoted one after another popular cartoons series like “Howie and Landau Amuxing”, “Adventure of Qiqi Keke” and “Little Chef Fugui” and created good result of being the first among all home-made cartoons series in audience rating and storybook publishing.
In Greatdream’s commercial modes, what is worthy to mention is “One Two Three Four” mode: “One” means one industry’s value chain.
“Two” means two drives: the first is content drive: cartoon series is the resource of brand and also the core. The second is retail drive. Retail is a very important brand stretch at present and provides channels for other business.
“Three” means three networks: retail network, licensing network and broadcasting platform network. Now there are about 500 broadcasting websites and there are 1,200 shops of retailing net in planning retail and 500 licensees.
“Four” means four aspects of service. The first is JBP service (assist the customer to make relating operation marketing plan). Through the research on industry and product types, according to the customer strategy and selling areas and channels, make a long-term selling target together. And in the first three months after the new licensed product coming into market and one time every quarter thereafter, Greatdreams company should hold business review meeting with customers in which retrospect the new product’s performance in market and the following promoting plan as well as the customer’s review on Greatdreams’ service. The second is channel service. Greardreams should open all the self-owned channels and assist the customers to enter the new channels’ (commercial center, supermarkets, business promotion meeting, buyers alliance) all-round integration and help them promote licensed products. The third is Merchandise Development (advices on product design and dealing methods). Greatdreams have merchandise department and database which can help to judge the market and get the best design scheme. The forth is to open media resource and make market propaganda ion together with the customers. Greatdreams have a network of over 600 TV stations and owns plenty time of picture advertisement. Greatdreams gives the licensees the free and good service in picture advertisement as a market support to the licensees.
Greatdreams Cartoon Company manage to cooperate strategically with many well-known enterprises like Longliqi, Huiyuan, Yili, Yake, Auldey Toys, Jinjianfeng and Huafeng Instant Noodles, which all have perfect channels and high brand popularity. They cooperate with Greatdreams Cartoon Company and are expected to invest 200 million RMB in 2008 to promote the licensed products of “Howie and Landau”. At that time, there will be over 1.4 billion children that contact with “Howie and Landau” licesed products which will greatly enhance the status in children’s mind of “Howie and Landau” cartoon images.
Greatdreams Cartoon regards creating “Chinese Disney” as its destination. After the previous hardships and struggles, it has found “Blue Sea” innovative business mode that fits for the enterprise’s high speed development. Through creating excellent original cartoon products and establishing network of children shops with unique personality, driving licensing and developing retail and multi-media business, it builds up a diversified service increment platform for Chinese families; it provides to the customers with integrated service of industry value chain. Greatdreams Cartoon successfully establishes innovative commercial pattern.
This innovative mode breaks the plight that Chinese animation and comics industry faces, which is caused by distemperedness of the industrial chain and the on profit circumstance due to separation of animation making with business operation in later period.
Writer’s Bio:
CEO of Greatdreams Cartoon, the gainer of special prize of 2007 Chinese Top 10 Fortune and Wisdom People and has ever been the senior vice-president of Wumart Group and vice-president of former Roland Berger Strategy Consultants. Former chief marketing officer of Vanguard, and member of specialist and consultant team of CCFA. He has won the title of leader in Standard & Poor's in retailing industry. Enrolled in the Chinese front 50 most potential professional handlers in 2003 “Global Enterpriser” and 2003 Chinese Top 10 marketing characters. █ |