Kellogg Launches Chief Marketing Officer Program

Photo: www.bizjournals.com

The Kellogg School of Management at Northwestern University has launched a new executive development program designed to specifically train students to become chief marketing officers.

Eric Leininger, a clinical associate professor of marketing, is the program's executive director, according to a report from the Chicago Business Journal. Gregory Carpenter, professor of marketing strategy, is the academic director, and Phil Kotler will be part of the faculty.

Read the entire article here.

J. Crew CEO Mickey Drexler to Speak at Harvard Club

Photo: www.bu.com

Millard "Mickey" Drexler, chairman and CEO of J. Crew Group, will be speaking at the Harvard Club on June 6.

Drexler is largely credited for guiding his former employer, Gap Inc., along a transformation where it went from a relatively small chain store to a clothing giant with more than 2,000 locations.

J. Crew was in poor shape when it hired Drexler in 2003. It was mired in debt but was profitable just two years after Drexler arrived. J. Crew went public in 2006, but was bought out five years later by Leonard Green & Partners and TPG Capital in a $3 billion deal.

The event is set to run from 7:30 am to 9 am at the Harvard Club (27 W. 44th Street between 5th and 6th Avenues) Non-members and guests must pay $50 to attend.

You can order tickets by clicking here.

Splitting Chairman, CEO Roles Fails to Tilt Performance

Photo: dealbreaker.com

Jamie Dimon, chairman and CEO of JPMorgan Chase, survived a movement yesterday to strip him of his chairman's title. The effort was backed by two prominent proxy advisory firms, but rejected by shareholders at the New York company's annual meeting.

A recent report by David Larcker and Brian Tayan at the Center for Leadership Development and Research at the Stanford School of Business makes an intriguing observation: separating a company's chairman and CEO roles has a nominal influence on stock price and financial performance.

“Instead of debating features of corporate governance features of corporate governance, more attention should be paid to contextual issues – a company’s leadership, culture, and specific situation," Larcker and Tayan write.

A summery of their research, which does not specifically address Dimon's roles and influence at JPMorgan Chase, is available here.

The Small Cost for Safety in Bangladesh

Photo: NBC News

I just read an short article on Bloomberg by two professors from Harvard Business School. The piece looks at ways to improve safety in Bangledeshi factories in light of the 800 deaths that took place at Rana Plaza.

What got my attention was a section of the article that evaluated the cost of improving conditions. Notably, the amount is small, especially if it is spread out and assessed on consumers.

It notes that, by some estimates, it would cost roughly $600 million each year to bring all Bangledeshi factories up to "Western standards." Factoring in Bangladesh's $18 billion of annual clothing exports, the authors determined that improvements would lead to a meager 3.3% cost increase for garments.

Karan Girotra and Serguei Netessine simplify it even more, noting that the cost of making a T-shirt would increase by a dime, to $3.10 per garment. "This is a very small price to pay for the ability to claim that no workers producing your clothing were in any danger of dying," they write.

You can read the entire article here.

Darden's Dean Bruner: Job Hopping is a Bad Idea

Photo: University of Virginia

Robert F. Bruner, the dean of the Darden School of Business at the University of Virginia, recently shared some interesting advice with this year's graduating class: plan for a minimum four-year commitment to your first post-graduate job.

Bruner made this thought-provoking comment during his commencement remarks, and reiterated them  recently on his blog. Four years is "barely enough time to learn the nuances of a complicated position, such as a leader or general manager," he wrote.

To read Bruner's complete blog, click here.

It Takes More Than Luck to Lift a TV Station

Photo: WFMY News 2

If you live around Greensboro, N.C., you are getting really familiar with Julie Luck, the new evening anchor for WFMY, a local CBS affiliate. That's because the station decided to lease a number of highway billboards to tout its new addition.

By playing off catchy sayings – "As Luck Would Have It" for instance – and displaying super-sized images of the anchor's smiling face, the station is hoping to build awareness of the overhaul of its evening lineup. Last fall, Luck left Fox 8 WGHP after more than seven years, leaving a station where she had anchored several afternoon and evening newscasts.

By my estimates, WFMY must have invested a handsome sum on the Julie Luck promotion.

I have counted roughly 10 billboards, both traditional and digital, on major thoroughfares across Greensboro. Based on an estimated price of $2,500 per month for traditional signage and $3,500 for a digital bulletin, the station may have spent $25,000 or more to promote Luck.

(If anyone has a better estimate, please feel free to post in the comments section below.)

"Julie Luck has received no small amount of promotion," Larry Audas, WFMY's president and general manager stated in a recent Facebook post. That may actually be an understatement.

This is evolving into a fascinating intersection between marketing and organizational behavior, where you have to balance a desire to build a brand around a new addition with maintaining a healthy workplace built around a news team.

It makes me wonder if WFMY will be able to get a solid and sustainable return on its investment. Having worked in the radio industry, I generally understand how the system works. The billboards draw attention to Luck and/or stories she is working on. That awareness prompts people switch from Fox 8 to WFMY. Those viewers help the station in the periodic Nielsen sweeps, which are then used by sales teams to encourage businesses to advertise.

But, as the title of this post states, it takes more than Luck to lift a TV station. This strategy would have been a no brainer a decade ago, but the rise of cable news and Internet programming is changing the math. Ad spending on broadcast networks is projected to drop 2% this year compared to a year earlier, according to Bloomberg. Total TV advertising, including cable, is on a pace to increase nearly 3% compared to 2012.

Technology such as tablets and smartphones make it easier to access online news, possibly deemphasizing the relevance of traditional local newscasts. Still, as my significant other Vaishali Shah puts it, having a marketing campaign built around a single personality could help WFMY differentiate from other TV stations, newspapers and other groups putting video online. It could help with Internet searches; typing "Julie Luck" into Google points people to WFMY much better than a generic search for "local Greensboro news."

WFMY is also taking a risk putting so much marketing behind Luck. Most, but not all, of the billboards around Greensboro feature her exclusively. That could upset other members of the team. It could give Luck undue influence in negotiating future contracts, salaries, etc.

An overreliance on one individual could also create a ratings vacuum for the station should she leave, another point that Vaishali made as we passed several billboards this afternoon. If people are willing to switch to WFMY to watch Julie Luck, they are equally apt to switch off if she exits. Brand loyalty in television isn't the same as it was back in the 1960's to 1980's when people were accustomed to Walter Cronkite, Tom Brokaw and the local anchors who were on a half hour before the national broadcasts.

What about the OB perspective? This campaign can also influence WFMY's ability to building a strong team. They must make sure that the ads do not upset the delicate balance of such a team. In the sports world, GMs must be mindful about hiring free agents who fit into the system rather than those that clash and cause distractions. I'm not saying that Julie Luck will purposefully cause a distraction, though there is a serious risk that a highly leveraged billboard campaign could chip away at an intended level of cohesiveness.

To his credit, I think Audas seems mindful of that. Luck "asked for none of" the promotion, Audas writes in his Facebook post.

"That's our doing," Audas adds. "What she has asked for, over and again, is a collective station commitment to see that Frank (Mickens), Tanya (Rivera) and the whole WFMY News 2 team win by serving. She has it. They have it."

Still, I will be curious to see how the team chemistry holds up over time. I believe this will serve as an interesting case study in the months to come.

Starbucks Loyalty Program Adds Negative Consequences

blogs.starbucks.com

I recently blogged about the subtle changes that Starbucks had made to its Gold Card reward program, noting how the company had quietly eliminated many of the program's perks.

Things just keep getting worse for the Starbucks marketing team. The company has decided to incorporate negative consequences into its loyalty program. That's right, the Seattle coffee giant has now found a way to thump customers who, for whatever reason, have reduced the frequency of their treks for java.

I just received an email from Starbucks notifying me that my card status was sent "back to Green for now" and that the company had reset my accumulated points "to zero." It is punitive enough to take away somebody's privileges but it is excessively harsh to negate all the points someone had accrued in order to earn rewards.

This is an eye-opening experience that doesn't require an ounce of caffeine!

The best loyalty programs reward loyalty, making people feel a sense of accomplish when they reach a certain level. Negative reinforcement is an ill-advised direction to take with a loyalty program. I was always taught that negativity breeds more negativity ... or in this case animosity.

Given an abundance of options, and even the healthy choice of avoiding fatty specialty beverages, people already have an incentive to ditch Starbucks. The company seems intent on giving people yet another reason to seek a coffee alternative.