Project introduction:

Pingan Insurance hired a famous international consulting firm in 2003 to assist in the corporation's development strategies and implementation plans. This project took around 9 months, and was met with moderate success. However, due to unforeseen circumstances, Pingan Insurance began to experience several problems while implementing the consulting firm's marketing plan, and as a result the company's revenue began to slip. Deteriorating inter-department cooperation, a shrinking clientele, high turnover rates were some of the main problems experienced by Pingan Insurance. KMG was hired by Pingan Group in such circumstances to create a new marketing strategy and implement a series of changes to the organization itself based on the idea of 'Finance and other business management'.

Project details:

The project lasted from January 2004 to September 2006. KMG made a clear proposal to perfect a client-based marketing strategy system by way of using corporate strategies and changes to organizational structure changes. The system was also to be used to increase sales production, profitability and revenues. The project was completed by September 2006 after almost 18 months of work. Pingan Insurance Group expressed high satisfaction in the results of the project.

KMG divided the project into two different stages. The first stage, being the stage where interviews and communication was carried out between the KMG team and the Pingan Group's employees and executives, lasted three months. An internal audit based on sales and management costs analyses was carried out in tandem with the first stage. After the first stage of work was completed and Pingan Insurance had inspected the results of the first stage of work, Pingan Insurance decided to further the project into its second stage. The second stage, being to modify Pingan's insurance marketing system consisted of:

• 1. Restructuring organizational structure based on individual and commercial markets
• 2. Reforming the company's sales and marketing department structures
• 3. Improving sales management and salary regulations
• 4. Implementing new methods for developing insurance plans
• 5. Creating a new customer database and information management plan
• 6. Creating market demographics model for the commercial market

In the second stage of work, KMG was in charge of formulating and implementing the restructuring and redesigning of certain departments in the company. KMG's plans were first implemented in Pingan Insurance's Shanghai branches, to much acclaim from the clientele. Some of the achievements in the second stage include:

• By using sales management and marketing systems to sort clients into MVCs and LVCs, KMG formulated an entirely new marketing plan for the next five years and an annual marketing plan. This led to higher budgets towards MVC marketing and lower budgets towards LVC marketing, and thus raised company profitability.

• KMG was also responsible for the creation of a potential client development department that relied on information and management tools to provide cross-marketing and potential clients for the sales team, thus creating and perfecting a highly efficient Leads Generation System

• A new risk management department was created to provide support for new insurance departments

• Creating a new sales team system based on branch organizations to market towards new demographics

• Creating new positioning for products and services based on special markets while also reorganizing the product department.

Results:

After successfully implementing the various marketing ideas and plans as suggested by KMG, Pingan Insurance achieved the following results:

• The potential clients department was able to surpass projected yearly goals within a single month

• The professional sales team was able to surpass projected yearly goals within a single month

• The previous two results indicate that after refining sales production, 600-900% growth was achieved.

• According to logical estimates based on profits made by new operations, the project was able to break even within 8 months and gain profitability. To note however is the fact that this statement does not include potential changes to clients resulting from the new marketing direction

Strategic Direction

KMG provided 4 stages of consulting services for JP Morgan

• 1. Strategic appraisal of the Executive Council
• 2. JP Morgan Marketing Strategy platform
• 3. Arranging marketing priorities
• 4. Creating JP Morgan Marketing Group

JP Morgan had set the lower limit for customer management services at 5 million USD. The lower limit was suspected as being a hindrance to the company when building relationships with younger entrepreneurs. As younger entrepreneurs had already built up relationships with other organizations by the time they had hit this lower limit, it was proving to be extremely difficult to convert them.

Perhaps the hardest part was the fact that JP Morgan had already experienced failures in the cross-selling investment brokerage industry and investment management. While users did treasure the fact that they possessed a check account at JP Morgan, clients often handled investment brokerage and investment management at other banks. Savings accounts are unprofitable businesses to JP Morgan. As an example, many users were unaware of the financial services provided by JP Morgan. JP Morgan did not have a specialized marketing department for promotion, nor did it have an information system to let customers access JP Morgan's product management department.

Strategic Appraisal of the Executive Council

Dr. Philip and Milton Kotler organized and hosted a 2-day conference for the executive council to affirm the core components of JP Morgan's strategic marketing positioning and sales growth. The conference touched upon the main problems of marketing management, including market analysis and planning, market segmentation and targeting, brand management and promotion, customer acquisition and customer services. The final executive management decisions came down to:

• 1.JP Morgan needs to create a specialized marketing department
• 2.JP Morgan needs to create a strategic marketing platform to make decisions and sustain profitable sales growth
• 3.JP Morgan needs to pass a brand plan to attract new clients to the company to better understand JP Morgan's product diversification plan

JP Morgan Strategic Marketing platform

1. KMG and JP Morgan agreed to create a marketing platform plan, and as such had to affirm JP Morgan's VIP list. 16 different interviews were carried out with JP Morgan's executives, sales managers, IT team, product development team and management team. Each interview lasted about 60 to 90 minutes, with each interview record being analyzed thoroughly.

2. Working alongside JP Morgan's employee team, KMG developed a strategic marketing platform plan based on research data and diversification interviews. The plan included:

• 1) JP Morgan US' services and long term planning
• 2) Strategic needs
• 3) Client needs research
• 4) Business growth goals
• 5) Competition-oriented commercial positioning
• 6) Brand plan: Asset management optimization
• 7) Sales and financial services
• 8) Relationship management
• 9) Creating a marketing culture
• 10) Technical support and information systems support

The platform was submitted to the executive council, and with clearance from JP Morgan's CEO Jaime Higgins, the marketing team executed KMG's suggestions.

Arranging marketing priorities

1.During the two years before KMG intervened in JP Morgan, JP Morgan US authorized large amounts of proposals for client development, client management improvements and new product development and management. However due to the lack of a formal marketing structure, these proposals were mostly ignored.
2.JP Morgan's project team invited KMG to evaluate these proposals to label priorities and separate them into groups: Marketing plans, systems and research, image management, product management, solutions sales, culture management, relationship management and competitive management. The evaluation process was completed in October and submitted to the executive council for inspection.

Designing a marketing team

JP Morgan's CEO and executive council asked KMG to formulate a customer-oriented marketing team. Before this, clients were only allowed contact via the sales team and the client service department with nothing in the way of client benefits management. After further discussions and research, KMG submitted a Marketing Formulation strategy report with 6 main parts, consisting of:

• 1.A group management team
• 2.Planning, research and systems team
• 3.Product cooperation team
• 4.Relationship sales team
• 5.Customer service team
• 6.Communications and promotion management team

After the completion of this project, JP Morgan hired its first marketing research director. The marketing team model as proposed by KMG was also implemented and began operations.