CEO Branding

Theory and Practice

Marc Fetscherin, Marc Fetscherin

• Publisher: Routledge
• Year: 2015
• ISBN:
  9781317746621
• Edition: 1
• Topic: Business
• Subtopic: Marketing
• Index: Business

CEO Branding advances our understanding of the importance and impact that CEOs have on companies. In recent years, there has been a growing body of interdisciplinary literature on this powerful aspect of branding, and Fetscherin has invited a leading panel of international scholars and practitioners to contribute original chapters in their area of expertise.

The book introduces the concept of the CEO as a brand, and outlines the "4Ps" of this branding mix – the CEO (person), personality, prestige (reputation), and performance. It discusses the CEO branding process, and demonstrates the many ways in which this 'human brand' affects the company in financial terms (such as performance, profit, and stock returns), as well as non-financial terms (reputation, trust, and firm strategy). The book also includes 'lessons learned' and many examples that illustrate how companies can measure and manage the CEO brand.

This comprehensive, authoritative volume will give students, researchers, marketing and communication managers, and CEOs themselves a thorough understanding of all aspects of the CEO brand. A must read for any CEO who is serious about developing, managing and measuring their own brand.

For more information, visit www.ceobranding.org

Part I
CEO Branding Process

1
Purpose and Power of the CEO Brand

Nick Nanton and J.W. Dicks¹

Chrysler was losing millions and was on the verge of going out of business for good. The year was 1978, not 2008, but the situation was similar for the company; it would require a government bailout to keep it going in both instances. Lee Iacocca, the new CEO, who had recently been fired from the Ford Motor Company after a clash with Henry Ford II, despite helping the company to a $2 billion profit, was determined to turn things around. With government money in hand, he slashed budgets and began to work on the design of revolutionary new vehicles, including the first Minivan and the ‘K’ car. The more pressing problem was that public confidence in Chrysler had plummeted after a series of massive car recalls. Restoring that confidence was key to Chrysler’s ongoing viability because without confidence in the cars and the company’s reliability, no one was going to buy them. Knowing what he had to do, Iacocca spearheaded a massive TV campaign. In commercial after commercial, Iacocca stared straight into the camera and said, “If you can find a better car – buy it.” Iacocca may not have known it at the time, but he was launching one of the first modern CEO branding successes. In the words of the online magazine, Slate:

the resurrection of Chrysler turned Iacocca into the symbol of a resurgent U.S. capitalism. He appeared on the cover of Time magazine, he bandied about the idea of running for president, and his autobiography became one of the best-selling books of the decade. Iacocca’s ascent signaled a dramatic change in American culture. Prior to him, the popular image of the CEO had been of a buttoned-down organization man, pampered and well paid, but essentially bland and characterless. Within just a few years, that had all changed.

(Surowieki, 2002, p. 1)

Yes, it had. Business leaders such as Iacocca, Donald Trump, Michael Eisner and Jack Welch have, in the decades since that momentous turning point, dominated the airwaves and the best-seller lists, demonstrating the public’s continuing fascination with our corporate CEOs and their success stories.

Branding and Going Beyond ‘The Everyday CEO’

While it’s true that most CEOs don’t have the budget that the Fortune 500 level CEOs have, and certainly not at the level of an Iacocca or a Trump, it’s worth noting that Richard Branson, the legendary CEO of the Virgin business empire, began by selling record albums out of his car trunk. By focusing with a laser-like intensity on the branding of both himself and his company, he built Virgin into a multi-billion-dollar business and himself into a business superstar. Branson’s branding success was the exception rather than the rule when he began his business in the 1970s.Today, the reverse is true. As branding expert Dan Schwabel writes, “these days, branding your company isn’t enough. The world wants to hear what you have to say. If you aren’t building your own brand, your company will suffer” (Schwabel, 2010, p. 1).

Most heads of businesses, however, are content to be perceived as ‘Everyday CEOs.’ They attend to their management duties without much concern for their own public perception, so long as it isn’t negative. That viewpoint, however, tends to keep both the CEO and his or her business out of the public eye, missing an important growth opportunity. While it can be tricky to build both the personal and the company brands simultaneously, without one overwhelming the other, it can also be incredibly worthwhile. The objective must always be to use CEO branding to create equal added value for both the business head and the business itself, with each feeding the other to give both broader brand awareness and greater public confidence. That objective has been made a great deal easier by the explosion of social media and online content – and when ‘Everyday CEOs’ use those tools to the fullest extent, they can turn themselves and their businesses into authentic and powerful phenomena.

One prime example of a business head pioneering the use of social media beyond the ‘Everyday CEO’ category is Gary Vaynerchuk. Vaynerchuk started his career by working in his parents’ New Jersey liquor store, Shoppers’ Discount Liquor. By training himself as a teenager in the intricacies of wine-tasting, he quickly became a reliable expert – and brought in more customers who came in for his knowledge as well as what he had to sell. When he inherited the store from his parents, he rebranded it as ‘Wine Library,’ and, in 2006, began to market his expertise beyond the store’s New Jersey community to the whole world, through a video wine blog entitled WineLibraryTV. He promoted the video blog relentlessly through Twitter and Facebook – and, simultaneously, he also began selling wine from his website. The online community reacted as positively as Vaynerchuk’s store customers did to his unorthodox wine reviews; soon Wine Library grew its yearly revenues from $4 million to $60 million (Asimov, 2009). Not only that, but Vaynerchuk also made himself into an incredibly successful self-help and business advice guru, making seven figures just from his speaking engagements and book deals. As the New York Times put it:

the numbers have made Mr. Vaynerchuk not only a wine industry phenomenon, but a social media superstar who’s being held up as a role model for using the tools of e-commerce to succeed in any business … his persona is as much about marketing as it is about wine.

(Asimov, 2009, p. 1)

Another CEO branding success story is Arianna Huffington, who was a minor conservative pundit in the mid-1990s, most known for aggressively piloting her Republican husband’s political campaigns. She slowly reinvented herself as a liberal, beginning her transition by telling Fox News in 2000, “the old distinctions of right and left, Democrat, Republican, are pretty obsolete” (Milbank, 2011, p. 1). In 2005, she saw the opportunity to create the progressive answer to the popular online right-wing website, ‘The Drudge Report,’ a collection of news headlines from various sources interpreted through a conservative viewpoint. With the debut of ‘The Huffington Post,’ a more tech-savvy, robust and user-friendly version of Drudge, she created and built an incredible brand both for herself and her new creation that culminated in a $315 million sale to AOL (Steel and Adams, 2011). That purchase by a mainstream company will inevitably push The Huffington Post to a more mainstream political position – necessitating yet another personal brand reinvention by its founder. Huffington said to the PBS Newshour in the wake of the sale, “It’s time for all of us in journalism to move beyond left and right” (Milbank, 2011, p. 1) – virtually identical words to those she spoke to Fox News during her last transition.

Both Vaynerchuk and Huffington went beyond their ‘Everyday CEO’ status to lift their small business ventures to multi-million-dollar heights – by combining an aggressive CEO brand with an innovative business model. Their stories demonstrate that any CEO, even one that only runs a local liquor store, can take the steps that will positively brand him or her in the eyes of the public and the business community, and, at the same time, create incredible added value for his or her company. By positioning the CEO as a company’s ultimate product and sales point, the entire business benefits in a myriad of ways.

More than Just an Ego Trip: The Added Value of CEO Branding

Some suggest that branding efforts of business gurus like Huffington and Vaynerchuk are just about their own ego trips. The truth of the matter is that both proved CEO branding is good business. When done right, it can not only be incredibly important to the company’s image, it can also prove very healthy for its bottom line. Research suggests that it’s also very necessary. According to a 2004 survey, the CEO’s reputation is responsible for about 50 percent of the public’s perception of a company (Burson-Marsteller, 2004).Of those surveyed, the CEO’s image is pivotal as to whether:

• 95 percent will decide to invest in a company;
• 93 percent would recommend a company as a good ally or merger prospect;
• 92 percent would feel confident in a company when the share price dips or stalls;
• 88 percent would recommend the company as a good place to work;
• 94 percent will believe in a company which is under media scrutiny.

“Consumers now care more than ever about the authenticity of the corporate brand, and CEO reputation is a critical ingredient. Similar to any wealth-creating asset, CEO reputation needs to be invested in, earned, and leveraged over the long term to reap enduring benefits,” commented Leslie Gaines-Ross, chief knowledge and research officer at Burson-Marsteller and author of CEO Capital: A Guide to Building CEO Reputation and Company Success (Van Yoder, 2006, p. 1).

According to David Larcker, a former professor at the Wharton School at the University of Pennsylvania, and now at Stanford University, a 10 percent positive change in a CEO’s reputation results in a 24 percent increase in the company’s market capitalization (Gaines-Ross, 2000). No responsible company can ignore the implications of that statement, no matter what its size. That’s why every CEO has a responsibility to create and manage a positive company and CEO brand. As Fortune magazine puts it, “despite the size and complexity of modern corporations, the person in charge still sets the tone, defines the style, becomes the company’s public face” (Nocera, 2002, p.1). Not only that, the financial benefits of a successful CEO brand, as detailed earlier, are something that any dedicated executive should feel an obligation to pursue. “With CEO’s more high-profile than ever … making a ‘brand’ of the person at the top of a company can be as important as hitting the firm’s quarterly numbers,” according to Portfolio.com (Piore, 2008, p. 1).

A.G. Lafley, CEO of Procter & Gamble from 2000 until his retirement in 2010, respected this obligation. When he was abruptly promoted to CEO after a sharp drop in share price, he set about radically changing the corporate culture. In 2009, his article in Harvard Business Review, “What Only the CEO Can Do,” articulated his vision of business leadership. “Conventional wisdom suggests that the CEO is primarily a coach and a utility infielder, dropping in to solve problems where they crop up,” he wrote. “In fact, however, the CEO has a very specific job that only he or she can do: Link the external world with the internal organization” (Byron, 2009, p. 1). That vision enabled P&G to double its sales during the decade he was in the company’s top job. He was named CEO of the Year in 2006 by Chief Executive Magazine, and his best-selling book, The Game Changer, was named one of the ten best business books of 2008 by Business Week. A.G. Lafley does not have a name that is on the tip of everyone’s tongue. However, he is a prime example of successful CEO branding that resulted in significant and visible achievement both for the company and for the CEO in question.

B2B CEO Branding

Does CEO branding make sense to a business that, for the most part, sells to other businesses? The answer is that it’s possibly more important than with a consumer-driven company, according to Harvard Business School Professor John A. Quelch, who writes, “Most B2B marketers cannot economically address thousands of small businesses using the traditional direct sales force. If left unattended, individual managers will each do their own ad hoc marketing” (Quelch, 2007, p. 1). The Harvard Business School surveyed the top B2B companies around the world and found that they shared these characteristics:

The CEO is a willing brand cheerleader, loves the brand heritage, and is a great storyteller. The CMO sees his or her purpose as helping the CEO achieve this role.

The CEO understands that building brand reputation reduces commercial risk, insulates the company in a crisis, and provides the common purpose that can bond all the company’s stakeholders.

(Quelch, 2007, p. 1)

The CEO brand as it applies to B2B companies is most visibly demonstrated by Larry Ellison, the superstar CEO of Oracle Corporation, a leader in enterprise software for other corporations. Ellison is known for his hard-charging business methods and often outrageous lifestyle. He’s been called “one of the last major larger-than-life figures in Silicon Valley” (Harris, 2009, p. 1) and his unique, high-profile leadership has created a brand that everyone knows and respects. “Ellison, for all his foibles, built Oracle brick by brick. It’s his baby. He is the only tech company CEO who has launched a business in the era of mainframes and taken it to client/server and then to the Internet” (Serwer, 2000, p. 1). Other businesses respect his break-the-rules approach and keep a close eye on what Oracle’s next move might be. Ellison has made it clear he knows exactly what he’s doing and why it’s helped him build a multi-billion-dollar business. Says Ellison, your brand is what people say about you when you’ve left the room. Marketing analysts agree: “Oracle Corporation gets millions of dollars a year in branding value by having an outspoken provocateur as a CEO. While you might not like him, Larry Ellison keeps people’s attention on Oracle” (Lochhead, 2008, p. 1).

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