HBS Professor: Time to Rebrand & Reimagine Strategy

When it comes to strategy, the force should be with you, says a Harvard b-school professor:

“Talk about strategy as the animating force of a company, the energy that directs everything that a company does.”

The Strategist - Cynthia MontgomerySo says Cynthia A. Montgomery (video interview below), the Timken Professor of Business Administration and author of The Strategist: Be the Leader Your Business Needs.

Montgomery has formed new thoughts about strategy based on years of teaching and coaching global business executives.  She writes:

“I came to see that we cannot afford to think of strategy as something fixed, a problem that is solved and settled.  Strategy – the system of value creation that underlies a company’s competitive position and uniqueness – has to be embraced as something open, not something closed.  It is a system that evolves, moves, and changes.”

The professor advises executives to consider four basic questions when it comes to strategy:

  1. What does my organization bring to the world?
  2. Does that difference matter?
  3. Is something about it scarce and difficult to imitate?
  4. Are we doing today what we need to do in order to matter tomorrow?

Watch Montgomery discuss why strategy needs to be reimagined. Continue reading

Channel Agony

The company that brought innovation to selling mattresses is no more.

New York based 1800mattress.com pioneered direct marketing for bedding, first by telephone and later via the Internet, with a focus on easy ordering, fast delivery and customer satisfaction.  But channel expansion into retail stores may have been its downfall.

The business was sold in bankruptcy auction in late June to rival Sleepy’s, Inc., who will fold the direct marketing part of the company into its own operations.  Sleepy’s is a privately-owned company with nearly 700 locations in eleven states.

Company founder Napoleon Barragan built his business, first called Dial-A-Mattress, with a direct response local telephone marketing campaign via newspaper advertising.  He later expanded to radio and tv advertising with messages that encouraged consumers to “Dial 1-800-MATTRESS and leave off the last S for savings.”  Advertising on Howard Stern’s radio show was also an important part of the marketing mix.

Barragan developed an effective business model that featured two-hour delivery in the New York metropolitan area (no more waiting at home all day long) and a customer satisfaction guarantee.  Telephone sales was later expanded to include Internet selling – same concept, good extension.  The company’s name evolved with the times as well:  from Dial-A-Mattress to 1-800-Mattress and then 1800mattress.com in 2007.

Dial A Mattress 1

It was the decision to expand into retail stores that proved to be momentous, and ill fated.  According to The Wall Street Journal, beginning in 2001, the company opened 48 stores, mostly in the New York metro area, with a few in Washington, D.C., San Francisco and Chicago.  Bad location was a major reason for poor performance, and the post 9-11 economic environment hurt too.   But it seems that a classic mistake was made.  The company strayed from its core idea and positioning, which was a unique consumer proposition for directly and conveniently buying mattresses by phone and Internet, to move into retail stores.  Unlike the company’s partnership with retailers in other region’s to extend its reach and basic proposition, expanding into retail stores moved the company into a different business and different business model.

It’s far easier to build on a brick-and-mortar base and add the internet as a channel (e.g., Barnes & Noble) than to take a direct marketing model and integrate backward to include brick-and-mortar (e.g., Gateway).  Simply put, “they got away from the business they did best,” summarized Furniture World magazine reporter Larry Thomas, a long-time follower of Barragan and his company,  in a May 2009 Associated Press article.  Mr. Barragan, quoted in The Wall Street Journal,  acknowleded that he should have “concentrated on his original direct-marketing formula.”

Going forward, new owner Sleepy’s plans to leverage that direct marketing approach.  “1800mattress.com is a valuable brand poised for future growth,” said COO Adam Blank in a statement.


Channel selection is a strategic decision and should be in sync with who the company is and what it does best.  The core business idea, consumer benefits and competitive points of advantage should drive the decision on what channels in which to compete.  Stick to your strengths, and resist the urge to be like everyone else.  Do what you do best!

Harvey Chimoff is a hands-on marketing leader and business-wide collaborator who builds marketing capabilities in B2B/B2C organizations that drive customer success.



Can Two Worlds Beat One City?

Tough times can make strange bedfellows.

In the United States, trade associations have become ubiquitous, with industry players pooling resources to champion issues for their collective benefit.  Think milk, pork, beef, and consumer electronics, just to name a few.

But two direct competitors, just six miles apart, with proud histories as separate Indian nations, joining forces to market themselves as a distinct entertaniment destination?  Now, that’s something altogether different.

Yet, that’s what Mohegan Sun and Foxwoods casinos in southeastern Connecticut are doing.  With consumers tapped-out of discretionary entertainment funds and casino revenues declining in this difficult economy (Mohegan Sun’s net income fell 13.3% for its fiscal year 2008), the two competitors decided to team up and battle for a greater share of the region’s gaming market.  How?  They’ve targeted Atlantic City.

“We can drive more business together than we can individually,” Michael Speller, president of Mashantucket Pequot Gaming Enterprises (owner of Foxwoods) told The Wall Street Journal.

This week, the former rivals launched an advertising barrage that uses billboard ads strategically located on major highways in New York City, Long Island, and northern New Jersey.  There’s also a Web site headlined “Two worlds beat one City”  (http://www.playctcasinos.com/).  Billboards feature that headline and two more that take direct aim at the Atlantic City gaming industry:  “Way beyond the boredwalk” and “Escape the Jersey snore.”  The ads were created by Adams & Knight, a Connecticut agency (http://www.adamsknight.com/).

 Two Worlds Beat One City Billboard

Way beyond the boredwalk Billboard

Escape the Jersey snore Billboard

Mitchell Ettess, president and chief executive officer of Mohegan Tribal Gaming Authority, the owner of Mohegan Sun, speaking about the northern NJ/NYC market, told The Wall Street Journal that “we want to aggressively approach those folks and show them Connecticut is a better destination.”

According to the Norwich Bulletin, “the venture, slated to run through the end of September, is designed to position the region as a major resort and entertainment destination. The program will highlight amenities offered collectively by the resort casino properties as well as the local tourism and hospitality industries.”

Time will tell if the eight billboard ads and Web site can effectively reach and impact the desired target market.  Apparently, print ads are under consideration for a potential phase two effort.


Defining your market and competition is a strategic decision.  Sometimes the competition is more than your competitor.  It’s rare outside an industry association, and definitely a tricky dance, but just maybe your competitor can be your partner.  Be careful, though.  Be very careful!

Harvey Chimoff is a hands-on marketing leader and business-wide collaborator who builds marketing capabilities in B2B/B2C organizations that drive customer success.