Service with a style

Philips CEO Zeven brings customer experience into focus as he tries strengthening the firm

By Aubrey Henretty

May 2, 2007 - “One of my tasks is to build up the brand,” said Paul Zeven, CEO of Philips North America. “Building the brand is a multiple-year project. Building the brand costs a lot of money. Building a reputation is very difficult.”

Zeven’s May 1 presentation at the Donald P. Jacobs Center was part of the Kellogg School’s “Fashion, Lifestyle and Design Speaker Series.”

With so many companies in the consumer electronics sector, Zeven said, the battle for the hearts and minds of consumers is more heated than ever. “We have to go to very creative [lengths] advertising. You’ll see us doing different things.”

Among the company’s recent forays into “different” advertising are last year’s award-winning “Shave Everywhere” viral marketing campaign (developed with the help of outside agencies) for the Philips Bodygroom electric shaver and the company’s 2005 arrangement with CBS to sponsor an episode of news magazine “60 Minutes” in exchange for near-exclusive ad time and a restructured commercial break cycle that allowed for longer spots but took up less broadcast time.

The Fashion, Lifestyle and Design speaker series, which highlights the ways in which businesses can capitalize on rapidly changing consumer tastes, is organized by Steven Fischer, the associate director of the Kellogg School's Master of Management and Manufacturing program. Previous speakers have included Kathleen Whalen, category manager of sportswear for Harley-Davidson, and Valerie Blin '98, director of luxury goods at DeutschesBank London. "Who sets these trends?" asks Fischer. "Who sets the fashions? Who makes things cool or not cool? Identifying these purveyors is very important for firms." Fischer addresses these and other questions in the undergraduate course he teaches at Northwestern University: The Fashion Industry: Sociological, Psychological and Economic Impacts.

Philips — or, as it is known in its home nation of the Netherlands, Royal Philips Electronics — is best known in the United States for its home electronics products: shavers, electric toothbrushes, televisions, stereos, and the like, but its portfolio includes items in other sectors.

Though Zeven said Philips has shifted its focus from the so-called “lifestyle” sector to healthcare in recent years, he also noted that the two areas are not mutually exclusive. As an example of the overlap between them, Zeven described some of Philips’s recent innovations in magnetic resonance imaging — the ones that don’t involve new technology.

Philips does manufacture MRI machines, but even the most advanced among them can intimidate patients and in turn cause problems for doctors, Zeven explained.