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No Gap Between CEO and CMO; How to Use a Hostile AI; Private Wellness Clubs Charge Thousands Per Month; A Bath & Body Works Strategy Fails

By Nat Ives | WSJ Leadership Institute

 

Good morning. Today, we’ve got more from the CMO Council Summit, from C-suite relations to the hard-won wisdom of founders. Plus: third spaces for the wealthy now offer hyperbaric chambers, and a retailer’s  “adjacency” strategy doesn’t come close to its goals.

Gap Global CMO Faby Torres on stage

‘The stars aligned’ when Gap’s denim campaign starring Katseye landed just after American Eagle’s ‘Great Jeans,’ Gap Global CMO Faby Torres said at the CMO Council Summit. Photo: WSJLI Video

CMOs don’t always seem to command the full attention of the C-suite, but Gap Global Chief Marketing Officer Faby Torres said CEO Richard Dickson’s focus was part of the reason she joined.

“He's a brand-first person,” Torres told Katie Deighton on day two of the CMO Council Summit. “....When they called me and when they hired me, it was the most interesting part.”

Asked whether a CEO that cares is a blessing or a curse for her own vision, Torres showed no insecurity. “That’s a blessing,” she said, while noting that “we have brand presidents that let us do what we know how to do.”

About that Katseye “clapback”: Gap’s viral “Better in Denim” ad featuring an assertive performance by the girl group Katseye seemed to some like a counterpoint to American Eagle’s immediately preceding “Great Jeans” campaign. But the cultural moment was just luck, according to Torres, saying Gap spent close to six months planning its effort.

Watch the full conversation here.

 
Content from our sponsor: Deloitte
Sustainability Attitudes, Beliefs Shift as More People Endure Extreme Weather

As more people around the world directly experience extreme weather, a sustainability tracker signals how their thinking on environmental sustainability is shifting. Read More

More articles for CMOs from Deloitte
 

Make AI Your Worst Critic

Wendy Bounds listens as Frank Shaw speaks on stage

The WSJ Leadership Institute’s Wendy Bounds interviews Microsoft Chief Communications Officer Frank X. Shaw on AI and storytelling at the CMO Council Summit. Photo: WSJLI Video

Chatbots’ unsolicited sycophancy can make it hard for me to trust their takes. ChatGPT recently lost me when it volunteered, for example, “That sounds like a stylish shirt.” (Don’t ask.) So I like this idea from the summit:

AI’s most effective role in the creative process right now may be a “sparring partner,” Microsoft Chief Communications Officer Frank X. Shaw said.

“You can say, ‘Hey, I'm making this news around something. Act as my competitor, act as a skeptical journalist. Pretend you are with the BBC and blow as many holes into this as you possibly can,” Shaw said during a conversation with the WSJ Leadership Institute’s Wendy Bounds.

You might also ask AI to summarize your work as a gut-check; if it spits out something your team didn’t intend, that’s a red flag.

“We use Copilot and we say, ‘What are the top 3 points from this PDF or this white paper?’ and then you're like, ‘That’s not it at all.’ If your agent doesn’t capture it, then the chance of anybody else catching it is just zero,” Shaw said.

One more takeaway on AI:

  • “It’s a black box,” Shaw said. “It's gonna make us more creative, more productive, take our jobs, you know, pick your poison, but it’s this thing. And what it really is, it’s a set of tools....You have to get people to start thinking about this as a set of tools, and they’re all going to use it slightly differently and you have to encourage that.”
 

An Observation

Katie Deighton pointed something out after a day and a half of main-stage interviews, hallway conversations and interactive exchange sessions at the CMO Council Summit—and she posed a question:

Unlike other marketing conferences this year, AI did not dominate every single conversation.

Has the novelty faded into the new normal? Or are fears around corporate reputation and brand crises more pressing to CMOs right now?

Now I’m curious; hit reply if you have thoughts.

 

The Magic Number

$2.45 billion

Valuation of Suno, an AI music platform that lets users generate songs with text prompts, in a new $250 million funding round. The valuation is up from about $500 million last year based on another fundraising round.

 

See the Summit

Jaclyn Johnson gestures as Katie Sturino and Gwen Whiting listen

Jaclyn Johnson, Katie Sturino and Gwen Whiting discuss the lessons of their experience founding companies, building community and maintaining a brand identity. Photo: WSJLI Video

The CMO Council Summit delivered the goods for marketers in the room on Wednesday, but now everybody can watch:

Full Sessions:

Balancing Risk and Creativity with Gap Global Chief Marketing Officer Faby Torres

Making the Ordinary Feel Special with Instacart CMO Laura Jones

Storytelling in the Age of AI with Microsoft Chief Communications Officer Frank X. Shaw

Founders’ Perspectives on Entrepreneurship with Jaclyn Johnson of Create & Cultivate and Cherub, Katie Sturino of Megababe and Gwen Whiting of The Laundress and The Fill

Reinvention, Resilience, and Courage with Bobbi Brown

Keeping Legacy Brands Iconic with Delta CMO Alicia Tillman

Don’t-Miss Clips:

Bobbi Brown Tells the Story of ‘Foundation Gate’

How Microsoft Leverages AI for Rapid Crisis Response

Beyond Margin: How Instacart Drives Impact with Community Relief Efforts

 

Quotable, CMO Council Summit Edition

“We really lean into the uncomfortable
and the cringe, because Big Beauty
was not doing that.”

—Katie Sturino on the strategy at her body care company Megababe. “We just launched a hemorrhoid cream a year ago called Butt Stuff, which everyone was telling me it was not gonna work,” she said at the CMO Council Summit. “It's now, I think, the No. 4-selling hemorrhoid product on Amazon.”

“We went to our CEO and CFO
and said, look, this is our time.
We got to go to the Super Bowl.”

— Instacart CMO Laura Jones on her process leading the brand to its first Super Bowl ad in 2025 after it had spent years “pretty much doing search ads.” Her team first diversified the marketing strategy, then studied the results and then made the business case to the C-suite, Jones said.

“The most important thing is I learned what not to do: not to waste time, energy, money, and not hire a lot of consultants,
unless they’re content creators.”

— Bobbi Brown on what she learned at Bobbi Brown Cosmetics that she is applying at her newer brand, Jones Road
 

I Refuse to Join Any Club Where I Could Afford to Be a Member

A woman lies in an open hyperbaric chamber

Hyperbaric oxygen therapy at the New York club Continuum, where annual membership runs from $40,000 to $100,000. Photo: James Farrell

Private wellness clubs are popping up all over the country, built for the era of self-optimization, sober curiosity and reliable affluent spending, Sara Ashley O’Brien reports.

They go further than their forebears that emphasized socializing, networking and third-space coworking. These clubs pitch themselves as one-stop shops for workouts, recovery and healthy fun.

Membership runs from hundreds to thousands of dollars a month, however—assuming you make it through the application process.

In New York, the lifestyle brand Kith is opening a members-only padel and wellness club in Greenwich Village called Kith Ivy, featuring a fitness center, a Giorgio Armani luxury spa and a “tonic bar” from Erewhon.

At New York’s Continuum, where membership starts at $40,000 a year, new members go through an onboarding process that includes “performance-based bloodwork.”

To be clear: Most of these clubs don’t request blood samples.

 

Back to Work

Photo: Bridget Bennett/Bloomberg News

Bath & Body Works will stop carrying products in some recently added categories such as hair care and men’s grooming, instead focusing on developing new and better offerings in its core competencies, Suzanne Kapner writes.

The retailer on Thursday reported a drop in sales and earnings and slashed its forecast for the year, partly blaming a difficult economic environment.

But the real culprit was a strategy pursued by former management that neglected its most-popular categories in pursuit of new avenues of growth, according to Daniel Heaf, the CEO since May.

Heaf called the expansion into new categories a distraction from core competencies like body care and home fragrances.

“Adjacencies are never quite as adjacent as people think they are,” he said.

 

Keep Reading

Shohei Ohtani of Los Angeles Dodgers throws a pitch

New rights deals for Major League Baseball are valued at a combined $800 million annually. Photo: Nick Turchiaro/Imagn Images/Reuters

Major League Baseball has completed new three-year media-rights agreements with ESPN, NBCUniversal and Netflix. [WSJ]

FCC Chairman Brendan Carr said the commission will review the power dynamics and contractual terms between broadcast TV networks and their local affiliates. [Deadline] 

A new TikTok feature is designed to let users control how much AI-generated content they see. [Tubefilter] 

Disney plans to expand dynamic pricing from tests at Disneyland Paris to parks worldwide. [Inside the Magic]

T.J. Maxx parent TJX Cos. said it expects a strong holiday season as the off-price retailer continues to win over inflation-weary shoppers with its value and deals. [WSJ] 

Kroger supermarkets started an AI-generated weekly insights report for brands. [Modern Retail]

Mondelez brand Ritz is coming back to the Super Bowl ad roster after a 2025 debut featuring Bad Bunny, who’s playing the upcoming game’s halftime show. Ritz declined to comment on creative plans including any possible return by the star. [Ad Age]

 
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We bring you the most important (and intriguing) marketing and experience news every day. Write me at nat.ives@wsj.com any time with feedback on the newsletter or comments on specific items. We want to hear from you.

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