Q&A with HMV’s Graham Sim

HMV won the award for CRM/Loyalty at the Marketing Week Engage Awards this year thanks to the thinking behind its Purehmv rewards scheme. Since then marketing director Graham Sim has taken on the role of group marketing director across both HMV and Waterstones. In this interview he explains how he will approach the brands and what synergies may exist.

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Graham Sim, who has just taken over the newly created group marketing director role at HMV Group and will now lead the restructured marketing department across HMV and Waterstone’s.

Marketing Week (MW) How will the new structure of the marketing department change what consumers see from both brands?

Graham Sim (GS): “As far as consumers are concerned both HMV and Waterstone’s will outwardly remain two very distinct brands – each with their own voice and values. So whether they are browsing in a Waterstone’s or in an HMV or checking out the latest press ads and product offers, the experience for both sets of customers will be much the same as before. This is how it should be, of course, as both brands have a tremendous heritage and are not without a certain iconic appeal, so the last thing we’d ever want to do is to undermine this in any way. Instead, what we’re really looking to do is to be in a position where we can further harness the power of both brands to help our marketing become even more effective as a key driver for the business.”

MW: Although the two brands will remain separate, how can the two leverage each other’s strengths?

GS: “Each brand will continue to engage with its own customers in its own appropriate way, but we will now have improved visibility across all our marketing output, which, in turn should deliver a range of practical and creative benefits. So, for example, we are now better placed to prioritise and manage the huge flow of work that comes in and out of the agencies that we both tend to use, and any good marketing ideas can be shared as well.”

MW: How will Waterstone’s take a leaf out of HMV’s book and become about being more than just a retail destination?

GS: “The route HMV is taking outside of retail isn’t one that Waterstone’s can or should necessarily pursue – it has to follow its own path in terms of how it engages with its customers and responds to their particular expectations. Waterstone’s has already made a great start through its brand refresh by moving into a more ’emotional’ territory, drawing heavily on the love that many of us feel towards books. Its stores, such as Kensington, are now being upgraded so they become social spaces that we like to visit and spend more time in.”

MW: Are there any plans to join up brand marketing or promotions across HMV and Waterstone’s?

GS: “There are no immediate plans as such, and, as I say, we are mindful of respecting both brand identities. However, it’s not hard to see how there might be future opportunities around, say, films franchises such as Harry Potter, where DVDs/CDs, merchandising and books overlap, to develop a campaign that could run across both chains – albeit in a bespoke fashion. Third party promotions and CRM could also work successfully across both brands, and I’m sure there will be many more opportunities that will come out of us all working together.”

MW: Are there any plans to join up loyalty programmes across both HMV and Waterstone’s how could Waterstone’s benefit from the Purehmv strategy?

GS: “Again, we have no immediate plans, especially as the cards and offers are quite distinct and complement each other well, and both schemes have been very successful. However, we are also conscious that books, like music, film and games can be emotion-based purchases, so we need to understand where there may be opportunities for the two schemes to overlap in some way.”

MW: Are there any plans to leverage the brands together through joint locations like Silverlink Shopping Park?

GS: “There is no long-term strategy to do this other than to take advantage of opportunities as and when they present themselves. Silverlink only became feasible because the closure of the Borders in the centre suddenly offered a great site, and the only we could take advantage was for both brands to work together so that we could take it on. So if any similar opportunities were to come up in future, I’m sure we’d consider them on the same basis – just like the small Fopp that we’ve just put into the Waterstone’s in Gower Street.”

MW: What its Waterstone’s digital strategy for both online, and ebooks?

GS: “While Waterstone’s digital strategy is still being developed, Waterstone’s have made no secret of their determination to be a significant player in the e-books market, and this will obviously be reflected in the way the brand continues to engage with its customers. It also helps, of course, that both Waterstone’s and HMV have access to sister company 7digital – one of the UK’s leading digital service providers, and is already making an important contribution to our respective online and digital offers.”

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MW: Will the restructure see a boost in marketing investment for Waterstone’s and/or HMV?

GS: “By working cleverer and hopefully delivering the significant synergies we believe are out there, this should enable the marketing for both brands to become more cost-effective and to engage with more consumers also. This, in turn, means we can invest in other parts of our brand or customer experience.”

MW: What impact will combining the marketing functions have on HMV and Waterstone’s performance?

GS: “In recent years marketing has played a much bigger role in driving the business forward, especially as it diversifies into new products and complementary sectors such as live music and digital. We want to keep building on this momentum, and bringing greater focus to our brand assets and having greater visibility across all our marketing is one way we hope to achieve this.”

Go to the Marketing Week Engage 2011 Awards page here

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