It is not often that startups, big companies, and a celebrity chef come together to talk growth strategies, but that was the scene at the annual Executive Marketing Summit at the New York Stock Exchange on Monday.
Offering tips on brand development—and how to choose the best tomatoes each season—television personality and chef Mario Batali took the stage sporting his signature orange Crocs. Known for such restaurants as Babbo in New York and his Eataly artisanal food and wine market, Batali said his brand has evolved based on what customers crave.
“They want spaghetti, they want a glass of wine, and they want honesty,” he said in a fireside chat with Andrew Ross Sorkin, co-anchor of CNBC’s Squawkbox.
Batali favors brand messages that are focused and to the point. When planning a new menu at his restaurants, he said, details of the entrees must be succinct. “Can we describe what this experience is in one or two sentences?” he asked. “If we can’t, then we stop and reconsider.” Customers do not have time for lengthy descriptions, Batali said, when deciding what they want.
Creating a widely known brand can also lead to a few headaches, and Batali learned the hard way how important it is to manage the image that gets portrayed in public. “You have to constantly think about the best way to present your brand without insulting people,” he said.
Batali spoke about how he dealt with the blowback from a less than flattering comparison he made, during a panel discussion in 2011, about Wall Street executives and former fascist dictators. “My misinterpretation of that debate was that it was just us,” he said.
The news media quickly jumped on the comments, which Batali said led to a boycott of his restaurants. “I took my lumps and I apologized,” he said. “You’re accountable for everything you say in the public space.”
Batali’s story was one of many shared at the marketing summit, which was hosted by NYSE Euronext, Interbrand, The New York Times, and CNBC.
A panel on growth strategies from rising companies featured an East Coast-West Coast lineup of Hayley Barna, co-CEO of Birchbox in New York; Clara Shih, CEO and founder of San Francisco-based Hearsay Social; Scott Sanborn, chief operating officer of Lending Club in San Francisco; and Bill Day, CEO of Tremor Video (NYSE: TRMR), based in New York.
Sorkin, who served as the panel’s moderator, asked what these companies consider when weighing whether to remain independent and go public, merge with a peer, or sell the business.
A number of options are available for Birchbox, Barna said, which ships monthly lifestyle and beauty product samples to subscribers. She wants her company to become an indespensible part of the beauty industry. “We could do it independently but we also see a way that partnering with another company could supercharge inevitability,” she said.
On Monday, JetBlue Airways announced a partnership that makes Birchbox the provider of amenity kits for men and women that will be given in-flight to customers in a new brand of premium seats.
Though Birchbox is private, Barna said finding ways to allow early employees to take a small percent of their vested shares off the table could encourage them to work even harder—especially to pay back college loans or cover a down payment on an apartment. “It’s expensive to live in New York,” Barna said.
Employees at Tremor Video, which went public in June, were able to take partial cash-outs of their shares, Day said. “We controlled it, in the sense of how much people could sell,” he said, “but it was enough to get people excited.” The company’s technology analyzes streaming video content and detects demographics of the viewers to better target ads. Going public, Day said, also gave early-stage investors in Tremor Video the chance to partially liquidate and open up the opportunity to bring in later-stage investors.
Meanwhile, Sanborn said Lending Club, a peer-to-peer personal loan market, views a public offering as a logical next step for its growth. “We have very big ambitions to turn this [company] into the next great consumer financial services brand,” he said.
Several potential benefits make going public attractive to Lending Club, Sanborn said. Half of the company’s customer base invests in the stock market. Furthermore, he said Lending Club believes it would fall under so-called “blue sky” regulatory exemptions that would allow the company to operate nationwide as a public securities issuer. “We’re currently only in about 26 states,” he said.
Remaining independent and nimble is important for Hearsay Social’s strategy, Shih said. Her company developed a social media management platform used to help regulated businesses such as banks and insurance companies increase sales. Hearsay Social raised $30 million in September in a Series C round led by Sequoia Capital and NEA, in part to further develop its platform.
“We believe there are inherent structural advantages to being independent,” Shih said. “Social selling is a very nascent, rapidly evolving space.”
Mobile was another fast-moving sector that brands took interest in at the summit. Jacob Cohen, a principal with Frog Design and an instructor at General Assembly, laid out a few trends expected to hit digital marketing in 2014. Cohen, who specializes in strategy and user experience design, pointed out the world’s transition from using big mainframes to tiny gadgets to access computing power. “We’re [adopting] this idea of much smaller devices that do very boutique, little things,” he said. The shift to small computing devices, Cohen said, also relates to the smartphone becoming a centerpiece device with other services and technology that use its connectivity.
Wireless technology and chip maker Qualcomm’s chief marketing officer Anand Chandrasekher spoke about the future of mobile and flashed the previously announced Toq smartwatch his company unveiled in early September. “A lot of the functions you normally do on your smartphone you will be able to do on this,” he said. The Toq lets users view text messages, make calls, and listen to music, among other features. Chandrasekher said his company is more interested in promoting the potential for the technology than diving deeply into the product business.
San Diego-based Qualcomm is ubiquitous in the mobile device scene, thanks to its semiconductors and technology being used in most smartphones. “We like to think of mobile as effectively the largest technology platform in human history,” Chandrasekher said. During an interview at the summit with Meredith Levien, executive vice president of advertising with The New York Times, he said mobile is becoming more of a lifestyle as it weaves into more aspects of people’s days.
The way mobile integrates previous technologies such as television and the Web, Chandrasekher said, makes it a prominent point of context for consumers. Making more use of mobile’s capabilities in retail when shoppers pay for products, he said, can help improve the experience. “Most of us that walk in to a physical retail outlet to buy a PC or smartphone, most of us are likely a lot more knowledgeable than the salesperson,” he said.
That is not particularly the fault of the sales staff, Chandrasekher said, because of the vast amount of information that is available about products. Using mobile technology to make information more readily available to salespeople can help the consumer experience, he said.
Mobile technology can also attract more consumers to stores, Chandrasekher said, by using augmented reality to bridge the physical and virtual worlds. Qualcomm’s Vuforia is an augmented reality platform that brands can build apps on top of, he said. Home improvement retailer Lowe’s uses Vuforia, he said, to animate its catalog. Consumers can use a phone or tablet to see how a washing machine, for example, might fit in their homes.
For some companies, showing off new technology may be a way to rebuild connections with consumers—if it is handled properly. Though the car brand Chevy is well known across the U.S. and certain parts of the world, Alan Batey, senior vice president and global head of Chevrolet, said his company is just making its presence known in some countries. He hopes the brand can make more headway promoting its Volt “extended-range” electric car to show how the company is reinventing itself. But finding the right message to get the overall public excited about the Volt has been a bit of a snipe hunt.
Unlike purely electric cars that run entirely on batteries, so-called extended range electric vehicles have gas engines that kick in after the batteries are depleted. “We have not done a good enough job telling that story,” Batey said, citing a need to better differentiate the Volt from other types of hybrid vehicles.
Another issue Chevrolet (a brand of General Motors in Detroit) is coping with is the stigma from the company’s bankruptcy and government-backed reorganization. The “Government Motors” label slapped onto the company by some parts of the public hurts, Batey said, but it also compels him to show how Chevrolet is changing.
“We’ve got a long way to go but there is a high level of passion at the company,” he said.