New Dial CEO Baum will stress marketing

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Seeking a cure for its ailing brands, Dial Corp. tapped marketing champion and former Campbell Soup Co. executive Herb Baum as CEO.

Mr. Baum told analysts last week he will emphasize consumer marketing and try to reduce Dial's reliance on trade promotion.

"I am just tickled with the brand power that this company has -- between Dial and Purex and Renuzit and so forth," Mr. Baum said. "We will market those brands to the consumer and maybe pull back a little bit from what I consider to be excessive trade [promotion] spending."

That sounds like what Mr. Baum's predecessor -- ousted CEO Malcolm Jozoff -- long espoused, said Merrill Lynch analyst Heather Murren, who asked how Mr. Baum would do things differently.

"I can tell you it will differ in terms of execution," Mr. Baum said. "I can't speak for what the prior management team said . . . but I'm a consumer package-goods person. I believe in the power of brands, and we will work very hard to get consumer pull."

Dial's board ousted Mr. Jozoff after learning the company would miss already reduced earnings estimates for the third straight quarter.

In addition to serving on Dial's board, Mr. Baum, 63, had been president-chief operating officer of Hasbro for the past 18 months. Before that, he was chairman-CEO of Quaker State Corp. for six years. Before Quaker, he served for 15 years at Campbell

"Herb Baum is an excellent marketer," said Ken Harris, a partner with Cannondale Associates, Evanston, Ill. "I believe in him as a manager, and he's a great brand builder. Dial should be excited to have him."

`DEPENDENT ON TRADE'

But he said he doubts Dial can make good on a plan to pull back from trade promotion to concentrate on consumer marketing, at least in the short term. "Dial has forever been heavily dependent on trade, so all of a sudden to turn tail . . . they're not going to be able to pull it off," Mr. Harris said. "They're not the major player in their [categories]."

Although it's not yet clear how, the management change is also expected to affect Dial's joint venture with German consumer products giant Henkel. It also may put on hold the venture's $30 million review for its Purex Advanced laundry detergent and Custom Cleaner home dry cleaning brands involving incumbent DDB Worldwide, New York, and BBDO Worldwide, Chicago.

Mr. Baum said that disappointing performance of Purex Advanced, launched earlier this year, was among problems leading to the management shakeup.

"I really need to get together with Henkel to talk about what's right and not right," he said, adding that he believes the price difference between the premium-price Purex Advanced and Purex's value-price base brand is too high.

Mr. Baum did not rule out selling all or parts of Dial or comment on analyst questions about a rumored acquisition by Sara Lee Corp. that never materialized. But he said stabilizing the company would be his top priority.

Besides the Henkel joint venture, he blamed current problems on a run-up in inventory of Dial's flagship soap brand as it rolls out a reformulated product and disappointing results from such lightly advertised personal care brands as Sarah Michaels, Freeman Cosmetics and Nature's Accents.

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