Most folks would see a gap as wide as the
If Baum and
Much of Quaker’s ongoing transformation from a motor oil company into what Baum calls a “marketing refining business” is right out of the consumer-goods marketing textbook. His second day on the job, he dismissed the company’s ad agency and
But brand makeovers aren’t the only force propelling sales at Quaker. Armed with cash from selling off an insurance business and natural gas operation, Baum is buying market share and new products, snapping up companies such as Specialty Oil, a maker of private-label motor oil for customers such as Wal-Mart, and Slick 50, an engine additive manufacturer. His strategy is to promote higher-margin products such as 4×4, Quaker’s new motor oil for mini-vans and jeeps, through the company’s Q Lube locations, “where we have a greeter who says, ‘Would you like to try this premium oil for your vehicle?’” Baum says. “Motor oil is a 2 percent to 3 percent after-tax business, but fast lubes are probably 5 percent,” he adds.
So far, so good, but the going is likely to be tougher from now on. Alarmed by Quaker’s unexpected resurgence, rivals who once wrote it off are determinedly guarding their turf. When Quaker’s market share edged up to 15.3 percent earlier this year, competitors “stepped in and started spending heavily,” pushing Quaker back below 15, Baum acknowledges. Others have displayed some marketing savvy of their own. Slick 50 owned 95 percent of the additive market until rival Duralube Oils Corp. launched an “infomercial” campaign that stole 30 percent of its business.
The hard-driving Baum, who is in the office at , six days a week, faced some difficult issues on other fronts, as well. The hardest by far: the decision to move Quaker from
What’s on Baum’s agenda now? Though he has installed packaging executives in many key positions, he rocked the motor oil industry last spring by luring over John Barr, president of competitor Valvoline, as Quaker’s president. That will free Baum to beat the bushes for more
HERBERT M. BAUM
Chairman and Chief Executive
Education: BA, finance,
Family: Wife, Karen; children, Dina, 24; Marc, 22.
Boards: Meredith Corp. and Whitman Corp.
Business philosophy: “I never want to be in a fair fight. I always want to go in with an edge.”
Outside interests: “I don’t do anything. Working is my whole life.” (Admits to having announced stock-car and motorcycle races at a track near
Greatest influence: Jim McNutt, mentor at Campbell Soup.
Most recent book: “Buffett,” by Roger Lowenstein. “I bet I got five ideas out of it, and I’m only a third of the way through.”
Car: Red Porsche 911 Carrera, his sixth one.