The problem is that stock analysts don't know what to make of the company. Is it a food company or an apparel company?
John Bryan, chairman and CEO of Sara Lee, is frustrated because he believes "the whole has always been worth more than the parts. We add value. The parts are what they are because of what we've done," he told our sister publication, Crain's Chicago Business.
But analysts are frustrated, too. They think the best thing to do would be to break the company in two so that investors would know what they're getting.
I am not personally an advocate of corporate name changes, and I believe I once cautioned Mr. Bryan about changing the name of his company to Sara Lee from Consolidated Foods. I warned him that putting a food moniker on the company would hurt it if food sales took a tumble, no matter how well its underwear and leather goods lines did.
What the company desperately needs, I fear, is another name change, one that won't conjure up either food or apparel, and one that will emphasize the dynamic strengths of a diversified portfolio (as the name change spin doctors might put it).
Giant companies seem to have a penchant for adopting corporate names that are a contraction of two other names, such as Hartmarx and Nynex, two of my all time unfavorite company names.
Nynex, the product of the New England and New York telephone companies, is mercifully about to be absorbed by Bell Atlantic Corp. if state regulators will overlook Nynex's record of poor service. I originally thought Nylantic would be an appropriate name for the new combination, but now I imagine Bell Atlantic will want to long-distance itself from any name sounding remotely like Ny or Nex or any combination thereof.
Besides, contraction names are out of favor. Why use a combination name that has absolutely no meaning, unless accompanied by tens of millions of dollars worth of advertising weight, when you can use nice-sounding words that describe a pleasant place to be, such as real estate development companies try to do? I'm talking names like Willow Bend or Rocky Creek or Fern Glen.
I know, I know. The design companies say the reason they use nonsense names is that all the real words are already taken. But just think-for the price of coming up with a really dumb name you could probably buy the rights to a pleasant sounding name that would make stock analysts feel all warm and cuddly about your company.
Coca-Cola Co. is making a big mistake by not renewing its contract with the Great Western Forum, home of the Los Angeles Lakers.
Just because the Lakers signed Shaquille O'Neal, a Pepsi endorser, Coca-Cola pulled the plug on its deal to be the exclusive soft drink sold at the Forum. That leaves the door wide open for Pepsi to take over the joint.
What an opportunity for ambush marketing Coca-Cola is giving up. Basketball fans might be thinking of Pepsi when they see Shaq slam dunking (or, gulp, missing a free throw), but when it's time to actually quench their thirst Coke would have been the one. Now they'll think Pepsi on the floor and most likely at the point of purchase.
I'll bet Nike will plaster billboard ads all over the Forum now that Shaq and his other corporate benefactor, Reebok, have come to town.