The flight from Big Brands to Technology Companies
At the DLD Conference, Scott Galloway, who is a professor of Marketing and Brand Strategy at the NYU Stern School of Business, gave a presentation on the “The Gang of Four” (Google, Facebook, Apple, and Amazon). The mind blowing stats in the presentation rival the annual Internet Trends report from Mary Meeker and is a must watch.
With that said, the unexpected part of the presentation is the attention that Galloway paid to traditional CPG. The presentation started out with the “sit up and pay attention” stat that:
For the Top 100 CPG Brands in the US, 90% lost share and 68% declined in sales over the last 12 months
But Galloway went further than that with the picture that started this post — an analysis of the number of people that left P&G, L’Oreal, Unilever, and other big CPG brands in order to take a job at Google, Facebook or Amazon. To save you the math, the data from LinkedIn shows 730 people left P&G, 393 left L’Oreal, and 400 left Unilever to go to these tech companies. Considering that traditional CPG (in particular P&G) are “promote from within” cultures, that is an amazing brain drain of top talent that is clearly technology oriented.
As a P&G alumnus, the numbers are not that surprising to me. I have watched first-hand as friends and former managers have left for the halls of these technology companies. They leave for bigger titles, higher compensation, faster career paths or a host of other reasons. That in itself isn’t new since traditional CPG has always been a training ground for other companies to recruit top talent. After all, one stat I heard for years is the fact that 15%+ of Fortune 500 CEO’s are P&G Alumni.
But what is new is that those employees are leaving for companies that in turn do significant amounts of business with their former employer. A fair number of folks have made the same move I did of going from the brand side to the agency side. But it was rare to ever see alumni move to other CPG “partners” like retailers or media companies. That is clearly changing. It also leads to the question of whether these technology companies are recruiting this talent for their connections back to their former employer or their expertise in brand building?
Said a different way, are they recruiting industry insiders to tap into brand dollars as sales people? Or are they recruiting CPG experts to bring branding best practices to the halls of technology as marketing leaders? My gut tells me the answer lies somewhere in the middle.
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