Volkswagen appoints Cheil Greater China as the ‘Brand Powerhouse’ in the China market following their eight month, €1.5bn global review

In a major account appointment Cheil Greater China has become Volkswagen’s Brand Powerhouse in China, based out of the agency’s regional Beijing headquarters.

The appointment follows an eight-month agency review globally that also the WPP Group pick up the account out of Interpublic’s Deutsch agency in North America. Omnicom will be responsible for Europe and South America. VW plans to improve its marketing efficiency by 30% while stabilising it’s global marketing budget at about €1.5bn

From 2019, Volkswagen is to pool its marketing activities in these regions in four new powerhouses, which are to be established in Berlin, Beijing, New York and São Paulo.

Jürgen Stackmann, Board Member responsible for Sales of the Volkswagen brand: “The brand is to be managed in a leaner, more centralized way. With the new partnerships, we will reach an unprecedented level of innovative power in marketing. Thanks to our more focused agency landscape and the expansion of our digital activities, we will become significantly more efficient. The far-reaching transformation of Volkswagen, which will also become evident to our customers next year with the world premiere of our new brand ID., will fundamentally change our marketing.”

Jochen Sengpiehl, Chief Marketing Officer (CMO) of the Volkswagen Passenger Cars brand: “Thanks to our new sales model, we will be in a position to communicate direct with the customer in the future. In the past, direct contacts were largely a matter for the dealers. In future, we will personalize our offering to a far greater extent than has previously been the case.”

The four powerhouses will bring their most creative people together under one roof. In each case, between 100 and 200 employees will work on campaigns in an integrated, cross-functional approach and develop content from strategy through to implementation and distribution. For the first time, this approach will make global campaigns possible.

In future, direct communications between Volkswagen and customers will be managed via a personal customer ID which is to be introduced with the new brand sales system from 2020 onwards. This will also allow the creation of a holistic, individualized customer experience via all points of contact with Volkswagen, in marketing too. The analysis and utilization of market and consumer data as well as the deployment of highly advanced digital tools and artificial intelligence will play a key role.

Ms. Kuo-Hi Lee, Head of China Powerhouse from Volkswagen Passenger Cars brand (pictured left), said: “Our brand initiative ‘Move Forward’ is rejuvenating and innovating the Volkswagen brand image in China. This requires a fully dedicated VW brand powerhouse. After a network pitch among leading network and holding companies, Cheil impressed us the most through their integrated approach and great performance in strategic insights, data driven integration, creative concepts and a new operational model. We are very happy to have them on board and excited to ‘Move Forward’ together on this momentous mission.”

“We are absolutely thrilled to have been appointed as the only Powerhouse in China. Together with VW, we are confident to reach a world class standard in innovation marketing and help lead the overall transformation of the Volkswagen brand in China” says Pully Chau, Group CEO of Cheil Greater China.

Cheil Greater China will be driving VW China’s marketing initiatives based on integrated marketing capabilities – i.e. creative, data analytics, digital, brand experience and PR.

Pictured above top: Cheil Group’s Ms. Pully Chau, Mr. Flip Soree and Jason Byun with Jochen Sengpiehl, Chief Marketing Officer (CMO) of the Volkswagen Passenger Cars brand after the global pitch presentation in June, 2018.

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