The new name for the merger of CJ O Shopping and CJ E&M on July 1 has been internally decided as ‘CJ ENM,’ which is an abbreviation for ‘Entertainment and Merchandising.’ The name reflects the company’s will to become Korea’s first global convergence content commerce company by merging CJ E&M and CJ O Shopping which have the best strengths in contents and product planning in Korea.
- The name has been internally decided as ‘CJ ENM’ meaning ‘Entertainment and Merchandising’
The two companies reviewed the potential names for the merger immediately after announcing the merger plan back in January. As a result, they settled on ‘CJ ENM’ as their company name, which conveys the meaning of their business while also aligning with the company’s aim. In particular, the name has a similar pronunciation as CJ E&M which has been earning a reputation as a global content leader, thereby enabling them to leverage their current brand equity to their advantage.
On May 10, the two companies openly explained to the employees the meaning of the new company name and the aim of the merger. The new name will undergo a final resolution through the general meeting of shareholders on May 29 and be officially used starting July 1 which will be the official date of inauguration. The services and brands used by the two companies such as CJ O Shopping, tvN, Mnet, and CJmall will continue to be operated without change for the time being even after the renaming.
On May 9, the two companies also had a chance to explain the new merged company’s vision and business strategies to the major shareholders and institutional investors. They expressed their will to create a new global market that signals a convergence of contents and commerce by generating synergy and more powerful premium contents unique to CJ.
- Growing into a global content provider with increased synergy from the merger
“The merger will provide premium contents with global competitiveness and differentiated commerce experiences for the 10 million customers of CJ O Shopping, 50 million viewers of CJ E&M, 200 million digital followers, and potential local and global customers of the merged company,” stated CJ O Shopping CEO Min-heoi Heo. “We’re now on track to grow into a world-renowned convergence content commerce company that can compete with the likes of Disney and Time Warner.”
“The new company will become a global content provider true to its name, which is now worth KRW 6.5 trillion this year and KRW 11.4 trillion by 2021, showing a 75% growth,” expressed CJ E&M CEO Kim Sung-Soo. “In particular, sales from the new convergence business to be launched by the merger will reach KRW 1.4 trillion a year by 2021.”
- Three strategies to become a global convergence content commerce company
To achieve these goals, the new company set three specific strategic directions: ① “reinforcing premium IP (original contents with intellectual property rights) competitiveness to become a total global entertainment company, ② expanding “digital content studio business” using the synergy of content-commerce convergence, and ③ providing differentiated shopping experiences by building a “content-based global vertical distribution platform.”
First, the direction of “reinforcing premium IP competitiveness” aims for the company to become a global content provider by securing contents with a world-level competitive edge. The plan is to expand CJ E&M’s content competency that brought evolution to the Korean cultural industry into various genres and combine it with CJ O Shopping’s commerce know-how, which will result in premium contents with a strong ripple effect and sustainability.
This business expansion will first be carried out in global markets where there is a halo effect of K-Culture such as Japan, Southeast Asia, North America and China. The company plans to lay the groundwork for localization by carrying out product partnerships and joint content productions, combining CJ E&M’s global fan base and CJ O Shopping’s prowess in K-Style products like beauty and fashion.
Second, “digital content studio business” pertains to a business that precisely captures the recent trend in which fewer people watch live TV and instead, are more engaged by fun story-based commerce videos that go viral on social media and YouTube. E&M and O Shopping will combine their digital content strengths and platforms to provide companies with optimum marketing solutions that meet the trend.
Third, they will establish a “content-based global vertical distribution platform.” ‘Vertical commerce’ refers to a shopping mall that focuses on category products in certain fields. The company plans to establish a bridgehead to present Korean products and brands to the global market by combining the core focuses of the two companies in beauty, living and fashion that have high consumer engagement and demand for selected information.
“We’re going to reform the existing business model based on the fusion of contents and commerce through the merger, while also accelerating global expansion and new market development by creating a new business model for digital convergence,” said an official from the two companies. “We will provide a whole new experience for our customers around the world through contents with global competitiveness and differentiated shopping services.”