CEO's Notebook

CEOs give advice on: advertising on cable TV, helping obese employees, going public without an IPO, hiring women for corporate boards, and replacing your ISDN Internet hookup.

Hands On

TV for the rest of us

Jim Carrey is just an actor. The real cable guy is named Daniel Weiss
By Marc Ballon

Daniel Weiss is the 29-year-old founder of Engineered Protection Systems Inc., a Houston-based commercial electronic-security company. EPS has seen sales skyrocket to $1.8 million in 1998 from $350,000 in 1997. Weiss attributes the leap in revenues largely to his ads on cable TV.

Cable advertising has been around for years. But according to Weiss, the secret is in how you use it. EPS has run a series of mostly humorous, low-budget 30-second spots all over CNN and CNBC in Houston. Weiss stars in the ads and has become something of a local celebrity. "We've generated a lot of repeat business from cable," he says. "It's a very powerful medium."

And it's cheap. Ads cost Weiss about $200 to produce and $10 per placement. Compare that with the cost of other Houston-area outlets for advertising: A half-page spread in the local business journal can go for $5,000 a week. A 30-second spot on AM talk radio may run $150.

In 1998, EPS spent $50,000, or 70% of its advertising-and-marketing budget, on cable. Weiss expects to increase that to $125,000 this year. Yet he wasn't always so enamored of the medium. "I figured there was no way we could afford it," he says. "The big stations were charging anywhere from $2,000 to $10,000 for local spots. I thought cable would be a little less but still out of our budget."

Then he tried it. EPS ran its first ads during November 1997. Not one customer responded. Weiss wanted to junk the campaign. "I thought, 'No wonder they're cheap,' " he says.

But he decided to give it another month. A week later a customer who had seen a commercial on CNBC bought a $30,000 security system. "I was sold," says Weiss.

EPS has built a brand name through its cable ads, which have also brought the company a ton of extra exposure. The local news media, including Houston's network affiliates, have all interviewed Weiss about security issues. And his own celebrity works to his advantage when he's selling, too. Whenever Weiss joins a salesperson on a presentation, it helps to seal the deal, he says. "If you've seen me on TV for six months, you think you know me and trust me," Weiss says. "You almost cannot avoid buying from me. There's something about the way TV affects people."

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Waist management
When does your employees' health become your concern?
Your business depends on the health of your employees, and obesity is a serious health issue. That's why CEOs should regularly discuss the once-taboo topic of weight with employees, says Emil Vernarec, senior editor of the New Jersey-based magazine Business & Health. The magazine recently published a special report called "Weighty Matters: Obesity, Health and Productivity." It asserts that companies should take an active role in helping obese employees.

Although it's mostly big companies that offer weight-reduction programs to employees--the list includes Boeing, Nissan, and Steelcase--Vernarec says obesity is an issue for small companies as well. "The problem cuts across the board," he says. "It costs the company directly, through higher health costs, or indirectly, through absenteeism."

The question is how to approach employees to encourage them to slim down. "Weighty Matters" offers these suggestions:

Create a voluntary program that educates all employees about health, regardless of their weight. It can be as simple as a memo outlining such subjects as health-risk assessments (HRAs). "Most health plans have an HRA on their Web sites," says Vernarec. "It's an innocent way for a company to raise employee awareness of health conditions without targeting any one group."

Provide resources for helping thin employees stay that way. In the report, Dee W. Edington, director of the Health Management Research Center at the University of Michigan at Ann Arbor, cautions that employees at "low risk" of obesity-related health problems also need to be vigilant about their health. "You've got to have strategies for both [healthy and obese employees]--but if I were forced to choose, I would work first on helping people stay low risk," she says.

Offer incentives, but base them on actions that employees can control. A worker can choose to attend weekly meetings, but he cannot will himself to keep cholesterol readings below 200, for example. Reward something like perfect attendance.

The editors of "Weighty Matters" make the case that the workplace is an ideal setting for a wellness program that includes weight reduction. --Michael Hofman

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Hot Tips
Knowledge management is a relatively young science. How can your company capture knowledge and use it effectively? Dorothy Yu, a partner at PricewaterhouseCoopers, suggests the following guidelines: