Portrait Of A Compulsive Entrepreneur
For a 43-week run stretching from mid-1983 to April 1984, the best show in the Jacksonville, Fla., broadcast area wasn't on syndicated radio or network television but, strangely enough, in the pages of a magazine devoted to local TV listings. The publication was a free (now defunct) weekly called Jacksonville Cable TV Magazine, and the 10-month miniseries was an autobiographical column called "By The Way . . .," written by 65-year-old publisher Wilson L. Harrell.
On the face of it, Harrell's "publisher's notebook" was a dubious candidate for media stardom. For one thing, its breathless, first-person prose style often read like a marketing manual crossed with pulp science-fiction. For another, the author himself was not a famous personage in his hometown. Although legendary in certain marketing circles -- not to mention in the archives of Procter & Gamble Co., a company he once taught the true meaning of the word "gamble" -- he was mostly a mystery man to his North Florida neighbors.
What Harrell did have -- and what enthralled his 86,000 readers, week after week -- was superb material, the raw stuff of myth. Country boy, hobo, war hero, entrepreneur, TV producer, mad marketeer, friend of the famous and scourge of the powerful, Harrell had at his fingertips a hundred stories of improbable triumph and at least as many of inglorious defeat. Once those stories started spilling out of him in print, there was about as much chance of stopping them as there was of the author quietly retiring to a tent by a trout stream. Harrell wrote as he has lived: like a man possessed. It was as if the impulse toward autobiography had been there forever, waiting for any available transmission line.
Take, for example, the column dated December 12, 1983. "Last week I gave you Chapter One of the Toasta-Pizza story," began Harrell.
To summarize, Art Linkletter and I had joined forces with The Peavy Co. -- a large and wealthy flour milling company -- to introduce a [frozen] consumer pizza product. . . . We knew that once our test market began that one or more major food companies would "read" our test results. If the results were good, they would proceed to copy the product. In February or March they would be ready to introduce their product at the same time we planned to "roll-out" of the test markets. [We had] to devise a strategy which would allow us to survive against our giant competitors who would be waiting with fangs bared and sharpened claws.
Brainstorming a new product, campaigning to bring it to the marketplace, feeling the cold threat of competitors closing fast from behind -- all were familiar themes to regular Harrell readers. So was the emphasis on "reads" and perceptions, indispensable tools to a master salesman. Even his old buddy Linkletter, no slouch of a shill himself, calls Harrell "the greatest salesman I've ever met," and the Toasta-Pizza saga would not disprove that. Great salesmen love great challenges, and mass-marketing a piece of pizza you could toast at home was surely one of those.
Our plan had to be designed to make major competitors think that we were going to do one thing while in fact we planned to do another. Big companies are predictable and meticulously follow standard marketing rules. To be successful, we had to take advantage of our maneuverability, be prepared to do the unexpected, and dare to be different. . . . Let me add that "risk-taking" is the term used when you are successful. If you fail, it's called "stupidity."
And if you write it down, it's called confession. For as Harrell went on to explain, Toasta-Pizza proved to be a marketing miracle -- and a manufacturing disaster. Everything about the campaign mocked conventional wisdom: the November launch, a risky time for any new food product to hit the shelves; the 20-city, nationwide blitz after no test marketing; the use of independent food brokers to do all the hard selling. Despite these long odds, retail enthusiasm for Toasta-Pizza was so great that Harrell's team soon projected their $10-million investment into a $100-million bonanza. Harrell himself loved every minute of it -- especially the accolades he received from stunned competitors.
His moment of glory came and went swiftly, however. Unreported problems at the manufacturing plant delayed product shipments long past the date dictated by scheduled advertising. When the trucks finally did roll, they rolled with 40,000 cases of tiny pizzas so badly mangled that about all a toaster could do kfor them was burn the evidence. While Linkletter fed his grandchildren Toasta-Pizza on network TV, the company's consumer hot line hit meltdown temperature. By the time the smoke cleared, Harrell said in the column, $9 million of Peavy money and a nice hunk of Harrell capital had followed Toasta-Pizza to the bottom of the freezer.
Such a setback might have daunted -- or at least silenced the typewriter of -- a lesser man. Not harrell. Every week his column delivered another tale of personal derring-do. Instead of windy essays on civic issues, he wrote of bribing his way out of Saudi Arabia with a passport full of U.S. money, and of how, in 1976, he blew $1 million in seed money trying to being to the market-place a (no kidding) three-pound shrimp. Opposite movie blurbs and recipes for Betty's Coleslaw, he detailed his close friendships with Hollywood notables Linkletter and Dan Blocker, and his establishment of one of the largest and most profitable food brokerage companies ever to service American military bases worldwide. In the waning weeks of Jacksonville Cable's existence, Harrell even revisited World War II France, where, having been shot down during a suicide run against a Luftwaffe squadron, he was hidden from the Nazis by French Communist Resistance forces. Every day, they buried him alive under their corn crop, his only lifeline a garden hose stuck into his badly charred mouth.
And when it came time to quit his public podium, even that was done in classic Harrell style. Harrell had first gotten involved with Jacksonville Cable as a favor to some friends of his son; characteristically, he soon envisioned something larger, such as turning it into a new national magazine. But the venture was floundering financially, and Harrell was powerless to do much about that himself. As owner and publisher, he insisted on a 50? cover price to mitigate his cash-flow problems, a move that rankled the president of the sponsoring cable company, whose subscribers had been promised a freebie. After some public squabbling, Harrell suspended publication and sold the magazine back to a handful of its employees. His readers were thus left wondering how on earth he had gotten out of France to return home a decorated hero. The cable company was left with a six-figure lawsuit for meddling in the business operation.
It was vintage Harrell. "When you look down the highway where Wilson has been," says Wellesley, Mass., management consultant John "Jack" Connolly Jr., former president of Harrell's domestic brokerage business, "you see a lot of wrecks lying by the side of the road."
"Traveling with Wilson is not always profitable," agrees Art Linkletter, who has bought a few tickets on the Harrell Express himself, "but it is rarely dull."
Nine o'clock on a sunny December morning, a Saturday: Harrell has already breakfasted with Bill Caldwell, president of Harrell International Inc. (HI), to sound him out on a scheme he has just hatched. Caldwell, a former vice-president of Consolidated Food Corp.'s L'eggs Brands Inc., works closely with Harrell on a variety of consulting projects and possible new-product launches; his marketing specialty is setting up distribution systems serving such mass-merchandising retail chains as drugstores and groceries. Harrell, who is HI's board chairman (there are only three other full-time office employees, plus Jack Sussman, HI's consulting tax accountant), gets more directly involved with deals related to the grocery-products industry. To this industry he brings more than 30 years' experience as an independent food broker, selling food products to retail grocery outlets on behalf of manufacturers and processors.
Harrell's new scheme ("we could be talking, uh, half of 1% of a $100-billion business, Bill") is to organize a coast-to-coast broker network with one specialized service feature: expertise in handling refrigerated products, the most difficult grocery products to manage successfully. It is his belief -- indeed, it is the central tenet of his salesman's soul -- that brokers are the unsung heroes of the retail, grocery business, the guys who stick their limbs on the line and make new products go. The fact that they routinely perform this function on 30-day manufacturers' contracts makes it a business with little security and lots of petty politics. Harrell argues passionately that any food producer with a hot new commodity and half a brain should value the broker as a partner, not dismiss him as a necessary evil. Brokers, he points out, are well-paid, influential members of their communities with ready access, social and professional, to the top rungs of supermarket management.
Ordinarily, the industry's political dynamic works in exactly the opposite direction. That 30-day service contract leads to a face-off: In front of every $250,000-a-year broker with a contract stands a $25,000-a-year manufacturer's sales rep with a Don Corleone complex. "Take care of our needs first," snarls the rep, "or we cancel your act." The broker is thereupon expected to fall to the carpet and beg for reprieve. Harrell does not buy this Godfather trip because, for one thing, he thinks it is counterproductive, and for another, it was always largely wasted on him. And why was that?
"Forty years ago," he explains, "I bailed out of a P-38 with my clothes, my chute, and my face on fire. I went 10 days without drugs or sleep. Germans were shoving bayonets into the hayloft where I was hiding. You think that after that, some lowlevel 'broker poker' from General Foods could walk into my office and make me quake? No way. No fucking way. I ate them alive. Because guys like that are useless if they can't find ways to scare you, and I'd already visited the outer limits of human fear."
Harrell has also visited the outer limits of strategic genius. It happened most dramatically in 1967, four years after he bought (for $30,000) a struggling company making Formula 409, a spray cleaner.
In truth, practically everything about 409 was serendipitous, including the fact that Harrell had firsthand knowledge of the cleaner's popularity -- his military customers adored it -- even among consumers who never saw any advertising for it. And surely it was good fortune when Harrell ran into a food broker in a Honolulu bar, who first suggested -- and then helped implement -- a brilliant strategy for domestic distribution: subcontract the ad work and produce commercials in-house; buy air time market-to-market, at discount rates; hire local personalities with local credibility and give them a piece of the action. Nor did it hurt when Harrell wandered into Art Linkletter's office, hoping to buy his high-profile pitchman's services for 409, and eventually walked out with a check for $85,000 and Linkletter in a 10% equity position.
But all that was only the warm-up for what happened next, and what happened next was one part luck to about six parts chutzpah.
"Procter & Gamble waited until we'd gotten up to around a 5% market share," recalls Harrell, "and then they got ready to roll out their own spray cleaner. Cinch, I think it was called. It didn't take a genius to realize that, with their marketing muscle, they could blow us completely out of the water. In fact, I once said as much to Procter's president, but I'll get back to that story later, because it makes a nice postscript.
"Anyway," Harrell continues, "I knew enough about how big companies like Procter operate to know that once they committed to the [Cinch] campaign, nothing short of absolute disaster could stop them. I couldn't outspend or outpromote them, so I had to outthink them. And believe me, Procter's got a computer somewhere that's programmed to anticipate everything."
What no computer in Cincinnati could possibly have anticipated were test-market results so skewed in a product's favor that disaster was practically built into the game plan. Harrell scrambled the numbers by taking Cinch's test markets and ordering all Formula 409 shipments to those cities delayed. He also pulled all of 409's supporting advertising and in-store promotions. With no real competition, Cinch became one of the most successful new-product tests in company history, causing Procter to sink millions of dollars and boundless confidence into its national rollout. Then Harrell dropped the other shoe. On the eve of Cinch's nationwide debut, he flooded the market with secretly manufactured, jumbo-size bottles of 409. Shoppers happily snapped up four-month supplies of their favorite spray cleaner, leaving Cinch to arrive with much ballyhoo and no customers. Early sales of Cinch were so poor, in fact, that Procter must have been tempted to fire its computer along with the several red-faced executives who soon fell on Cinch's sword. Shortly thereafter, Procter abandoned the product entirely, a surrender with few precedents in the company's long, take-no-prisoners history.
And the postscript?
"Linkletter used to take me to the Bohemian Grove on retreats," says Harrell, referring to the famous club in northern California where members of the military/industrial elite hide out and go native. "Everyone there hangs out in old clothes and says very little about who they are. In the early days of the 409 market rollout, right when it was really taking off, I met a guy there named Randy Dixon. Didn't know who he was, but we had a hell of a good time together. On the last weekend, Dixon took me to meet Howard Morgens, the CEO of Procter. He told Morgens that we ought to get to know each other. I was in awe of Morgens, of course, and told him what a great company Procter was. When Morgens found out I owned 409, he looked at me and said, 'Don't worry, Mr. Harrell, I've heard of it, all right.' And I said something like, 'Sir, if you ever decide to take over my little old spray cleaner market, I'm sure you'll gobble me right up.' Morgens looked genuinely horrified. 'What are you trying to do to me?' he cried. At that point Dixon put his arm around me and said, to Morgens, 'Oh no, you won't!' That's when I found out Randy Dixon was the head of the Federal Trade Commission.
"Chapter two," continues Harrell, ever the anthologist. "I'd sold 409 to Clorox, for $7.5 million. Ran into Morgens again at the Grove. He was extremely gracious. Said what I'd done [to thwart Cinch] was one of the finest marketing jobs he'd ever seen. 'Wilson,' he said, 'you'll be remembered for a long time around Procter & Gamble, I can promise you that.' That didn't surprise mr: I figure it cost them $25 million [to pull Cinch], figuring in the cost of picking up all those bottles. But in my personal chest of medals, I'll always have Morgens's statement about 'one of the best marketing jobs ever.' That means a hell of a lot to me."
Breakfast behind him, Harrell makes the short hop down the boulevard from his own office to see Del Dallas. Dallas, one of Jacksonville's largest food brokers, is only a casual acquaintance of his (they have shared a few golfing foursomes in the past), but Harrell feels -- no, he is sure -- that there is urgent business to discuss. One item on his mind is this notion of lining up a network of refrigerated-case-service brokers. Another, intimately related to the first, involves one of Harrell's clients, a large, Florida-based food company (he declines to say which one) for whom he has been doing some freelance consulting. As it happens, this food producer makes orange juice -- frozen juice, refrigerated juice -- and has been looking to expand its modest kmarketing territory. Guess who just jumped in to join the party?
"I want you to play 'what if?' with me for a minute, Del," Harrell tells Dallas in his muted south Georgia drawl."What if my client comes to me and says, 'Wilson, we can't figure this one out. Procter & Gamble appears to be out of its mind. First they buy Citrus Hill [orange juice]. then they try to jam it into the refrigerated case, where they can't hope to make any money with it, while all but ignoring the freezer cabinet, where they could at least make some sort of profit. What's even crazier, they offer to pay grocers back for shelfdated product at full retail value. From what we can tell, they're losing millions on this thing."
Harrell rearranges himself sideways in Dallas's office chair. "And what if," he continues, "I inquire a little further and find out that Procter has put its coffer people -- its very best people, in other words -- on the citrus Hill campaign. And that out in California, they jack up the price so that it's even higher than Minute Maid's. What do you think I start thinking, Del?"
Dallas meditates for a moment. "I dunno," he answers. Then, after a pause: "I'll tell you one thing, Wilson. I was a Procter salesman for 13 years, and they don't do anything without a master plan. It could be a 2-year plan, a 5-year plan, a whatever-year plan, but they're not in business to lose money."
"Exactly," smiles Harrell. "Now look at Procter's history. Their one great success formula is taking a product they can make some sort of claim for -- a slightly improved soap, a slightly better cookie -- charge more for it, and advertise the hell out of it. They do that up and down the aisles. But they don't do much in the refrigerated section. Nobody does, except Kraft. Take away what Kraft does, and the refrigerated case is the worst-managed, least-utilized product area in the supermarket. For any company with the money to master it, that case is the last frontier."
"Uh huh," agrees Dallas. "I'm with you so far."
"So here's what I'm thinking. I'm thinking Procter likes the juice business, but that's just the entry price to that cabinet. Once they're in there, they're gonna look down the shelf at an awful lot of pickle companies and tortilla makers waiting to be had. And when they move, the small guys won't know what hit 'em. Procter will either buy them up or roll over 'em like a tank."
"I doubt Procter has much interest in the rinky-dink stuff," counters Dallas, "but, yeah, they'll probably expand once they're in there. What's your point, Wilson?"
"The point is this," says Harrell. "If you're a small manufacturer sitting in that case, you had better plan to out-manage Procter, or as sure as I'm sitting here, you'll be refrigerated history." He waves a finger in the air. "Now, how do you do that? By organizing a national sales force? Forget it. Coupons and [in-store] promotions? Give me a break. No, your only hope is to use brokers more effectively, because they have direct access to, one, the local markets, and two, the top people, the heads of the chains. They can outdo Procter. But. . ."
". . . You have to know how to motivate 'em," Dallas chimes in.
"That's right," says Harrell quickly. "Forget this 30-day, I'll-fire-your-ass bullshit. Give them one-year contracts with built-in performance goals and stay the hell out of their way. Get brokers who'll hire housewives part-time to cover every store in their area, weekly at least. Use their contacts. Let them call the shots.You see what I'm getting at?"
"The small guy gets the shelf service he needs."
"And gives up almost nothing," nods Harrell, who by now is practically upside down in his armchair. "Give me 52 brokers across the country who can offer that kind of service, and I'll get them a hundred accounts [with companies] who'd rather fight Procter than fold." He sits upright and squints. "You interested, Del?"
"Could be," smiles Dallas. "I tell you, Wilson, you're a hell of an idea man. By the way, what handicap are you playing at these days?"
Driving home later, Harrell fields a question about his hip-shot analysis of P&G. "I happen to believe it with every morsel of my body," he confides, "but the fact is, it's the perception of what Procter's doing that's more important to me right now than the reality. Hell, this business is all perception. From packaging to marketing, it's a massive con game. Millions get wagered on what companies like Procter appear to be doing.
"And," he adds softly, "people who bet the right cards at the right time can make a ton of goddamn money."
Harrell's self-perception changed radically after the war. The shy Southern kid with a bookkeeper's aspirations became a chest-thumping cowboy riding high in the saddle of the American Dream. He bought the South Florida distributorship of a national firm selling simplified accounting systems to small businesses. Within two years, he was its national sales manager. He sold insurance for Aetna Life Insurance Co., and made the Million-Dollar Club his first year. He palled around with politicians and considered running for Miami's city commission. When the Korean conflict broke out, Harrell reenlisted and got sent to England, where he was handed responsibility for managing a string of U.S. officers clubs in the London area. After Korea, he divorced his first wife, took up with an Englishwoman (Daphne Mercer, who soon became the second Mrs. Harrell), and became a London-based food broker supplying military commissaries and post exchanges.
American companies marveled at the results. "I was so far removed from my sources [of production]," says Harrell of his crash course in the brokerage business, "that every screw-up was a three-month headache for me. I couldn't afford even the smallest problem. The Kraft product I was putting into the Munich-area commissary had better shelf dates than they had in Atlanta."
For nine years, Europe was his adopted home -- Great Britain, Germany, France -- but America was still the mother country, and in December 1959 he came home for good. The Harrell family settled in Connecticut; and Harrell International, the unbrella company, that would become the main marketing vehicle for 409, soon launched itself on an acquisition course every bit as impulsive and eccentric as its boss. While continuing to expand its overseas operations, Harrell's company bought up marinas, cattle ranches, giant-shrimp futures, you name it. In 1971, after the sale of 409, HI started collecting domestic brokerage businesses as well, eventually owning pieces of some 50 firms in all, a group it consolidated into 14 major brokerage firms. One of them, Horn-Harrell Inc., in Los Angeles, was practically an empire unto itself, with close to 30 principals and sales volume of more than $55 million in 1975. A couple of years later, Harrell decided to sell them all back to their principals. After what Jack Connolly describes as "a number of friendly meetings with brokers and lawyers swinging two-by-fours at Wilson's head and Wilson swinging right back," the deals were done.
Why sell" Harrell's answer is coarse and to the point. "The world is made up of pirates and farmers," he says. "Pirates come in and kill all the natives, rape all the women, and level the landscape; farmers follw after them to till the soil, plant the seeds, build the communities. I realize you need both, but I was never much of a farmer." Or, as Linkletter puts it in a slightly different vein, "Wilson's one weakness, if you want to call it that, is always having to plunge ahead in high gear. He wants -- maybe he needs -- to risk it all, all the time."
Critics might find other weaknesses, too. There were a couple of hassles with the federal government a few years back. One, an Internal Revenue Service audit, recently resulted in a $275,000 settlement on an alleged $6-million tax liability. The other, a grand-jury investigation into Bird-Harrell Inc.'s (a subsidiary of HI) expense account procedures, moved Harrell to protect his operating companies by agreeing not to call personally on any Army and Air Force Exchange Service accounts for a period of three years. He also sold the military brokerage business -- for $14.2 million -- to a former colleague. While not denying the substance of the grand jury's charges, Harrell insists it was much ado about very little, the price paid for being in business with the U.S. military in the first place.
"They [the government] thought they had a big target to shoot at," he says, "but bribing generals was not my style of doing things. It wasn't a question of morals, really, it was a basic business decision. I found other ways to sell the accounts I needed to sell. Perfectly legal ways, too.
"Still," he sighs, "there's no stopping the sanctimonious once they think they can nail you."
If that is a fair assessment, then Harrell's balance sheet looks pretty good. Throw out Toasta-Pizza (Why not?Toaster owners did) and a few other ideas whose time never came, and his marketing hunches seem sound. The business record, moreover, speaks for itself. Whether launching a new venture or scuttling an old one, Harrell always stayed right where he wanted to be, at the center of the action.
Well, almost always. Harrell does have one painful regret in recent times: his failure to make a household cleaner called 4+1 into the Formula 409 of the '80s. The product itself was not bad -- 4+1 was a liquid concentrate to which the user added water at home, thereby saving considerable money -- and the organizational principle may have been brilliant. Harrell wanted to (and did) build a "Third Wave" company: All manufacturing was subcontracted out, all other functions were decentralized, brokers were drafted to lead the marketing effort. There were no -- as in none, zero -- regular employees. Linkletter signed on as national spokesman, as well as investing (with ex-"Bonanza" stars Lorne Greene and Michael Landon) in the $1-million tax shelter used to finance the venture. And the product actually achieved major supermarket penetration, totaling 90% nationwide, on the strength of the selling effort, a possible world's record for an item with no test markets in its dossier and a paper company behind it.
Alas, consumers shunned it. Says Linkletter: "For 25 years, I've been associated with products sold on their convenience factor: easier to use, more expensive. Here was a product that was more complicated to use but cheaper. We hoped the times were ripe for it to go, but we made a bad misjudgment."
"If nothing else," avers Harrell, "we set up a company that made the product king, and that's all-important. If the product's king -- not management, or the board, or the sales force, but the product -- then you've accomplished something."
And what else did 4+1 accomplish?
"We were the first company in history to go broke without going bankrupt."
Taking all that he has learned -- the good, the bad, and the ungainly -- Harrell now wants to apply it to revolutionizing the food industry. His current cause, building a new broker network, is in high gear for 1985. There are meetings scheduled across the country with old contacts and new faces who might want a piece of the action. Millions more dollars may come in as a result. If not -- if the whole thing blows up in his face, if Procter drops him in his tracks, if defeat looms in any form -- he will look upon it as another interesting chapter and move on to something else. Pirates think like that, he says.
So it is very possible that when the book finally closes on him, Whilson Harrell will be appreciated as a man of many subplots. Some will live forever in the annals of marketing lore, others will be hooted out of the back room. Whatever their fate, they deserve to be read as parts of a whole, for it is the whole that makes the story worth reading.
Oh, by the way. For all you Jacksonville Cable readers still wondering what happened, here's the last chapter of the Great French Escape. First, Harrell watched from his stretcher as the underground blows up this bridge, see, and then Patton -- that's right, General Patton -- sends in a tank to rescue Harrell and his buddy. His buddy is a fellow P-38 pilot, and it turns out that the guy driving the tank just happens to be the pilot's brother, although neither expects to find the other there. Really. They throw their arms around each other and throw Harrell on a Red Cross meat wagon, after which . . . aw, never mind. Wait for the movie.