From Nabisco to Tropicana to...Efdex?
Brand-marketing whiz Ellen Marram faces her biggest challenge yet
Ellen R. Marram has always liked to go her own way. When she graduated from Wellesley College in 1968, many of her classmates were too busy embroidering flowers on their jeans and preaching free love to think much about their futures. But Marram donned a suit and marched straight over to Harvard business school, one of few women of that era to do so. And in the three decades since, she has become one of the highest-ranking and most visible women in Corporate America. Yet after becoming the CEO of Tropicana Beverage Group in 1993, Marram quit a year ago when the company was sold, brashly announcing that she was leaving to devote herself full time to searching for a CEO job.
Now, Marram, 52, has resurfaced--and she's surprising everyone once again. With her stellar credentials, which include heading Nabisco Biscuit Co. and turning Tropicana into a global juice-industry leader, many figured Marram would become one of a handful of women to head a large U.S. corporation. Instead, she has settled on a tiny Internet startup called efdex. Never heard of it? Join the crowd. It stands for electronic food and drink exchange, an idea that Marram insists will revolutionize the way everything from grocery chains to restaurants do business.FROM SCRATCH. It's a huge gamble for Marram--and in many ways, a big comedown. She has traded thousands of employees for a team of six at efdex's Stamford (Conn.) headquarters and a staff of 200 scattered around the globe. Instead of a massive global brand, she's hawking a name that sounds like some obscure software product. But that's not how Marram sees it. She says she was excited by the idea of efdex and wanted the chance to build something from the ground up.
She'll certainly have that. Today, food exchanges exist for only a limited number of food commodities, such as coffee and soybeans. For everything else, informal networks of buyers and sellers have evolved over time. What efdex proposes is to create a broad, superefficient exchange for every type of food imaginable, with thousands of customers trolling the Net to find the best deals on everything from tiny shipments of pricey Italian truffles to massive quantities of hamburger meat.
Marram is courting restaurants, retailers, and food manufacturers such as McDonald's Corp. and Campbell Soup Co. on the buyers' side. She also wants to recruit everyone from individual farmers to multinational conglomerates to list their foodstuffs on the exchange. Efdex, which got its start in Great Britain, will debut in Europe next month before a scheduled U.S. rollout in early 2000. It plans to make money charging for advertising and commissions on trades and by selling proprietary industry data on such things as prices or supplies. "This could be very big," says Nomi Ghez, a Goldman, Sachs & Co. food-industry analyst. "Ellen is getting involved for a reason."
Described by former co-workers as smart, demanding, and sometimes short-fused with subordinates, Marram seems the unlikeliest of Net entrepreneurs. Conservatively dressed in a crisp navy suit accented with small gold earnings, she sports a look far more at home in a corporate boardroom than among the java-sipping, khaki-clad Gen Xers who typify the world of Web startups. And though her name clearly adds clout to the tiny company, it doesn't guarantee success. For starters, plenty of others are trying to launch similar services. What's more, it's unclear whether the food-and-beverage industry will embrace efdex as their preferred way to do business.
Even assuming that efdex is viable, is it a good fit for Marram? She made her mark as a consumer-products whiz, but efdex is positioning itself as a business-to-business company with little or no interaction with consumers. That has raised some eyebrows. "I don't see how this plays to her consumer strengths," says an executive who has worked closely with Marram. "Maybe it will grow big enough to hold her interest, but I think her talents are being wasted." Adds Terry L. Preskar, a former Nabisco colleague who is now vice-president of health management at Merck-Medco Managed Care: "I was a little surprised when I found out."SCUTTLED SPIN-OFF. Marram insists she didn't want to take a job where "they were asking me to do again what I'd done before." Her path to efdex began when Seagram, Tropicana's parent, sold its juice division to PepsiCo Inc. in August, 1998. Seagram had been planning to spin off Tropicana into an independent public company, and many observers expected Marram to stay on as CEO. When that didn't happen, Marram says, she was "a little disappointed."
Others insist her reaction went deeper. "Ellen was absolutely crushed," says one Tropicana insider. Adds a headhunter who has closely followed Marram's career: "Her biggest disappointment in life was not having that IPO." Marram says she supported the sale. "It was the best thing for Tropicana. It just wasn't the right fit for me," she adds. "I didn't have the necessary enthusiasm to stick around."
In any event, Marram quit not long after the deal was announced, and for the first time in three decades, she was without a job. Few doubted that she would soon find work. The wide expectation was that she would land a top corporate job within weeks or months. "Pepsi could have been a port in the storm while Ellen looked for something else," says Steven A. Seiden, an executive recruiter and president of Seiden Krieger Associates Inc. "She had the guts to say no."
Instead, she jumped onto a roller-coaster ride of endless breakfast and lunch meetings. But the weeks and months rolled by. She was considered for the post of Levi Strauss & Co.'s chief operating officer and for other jobs. But while she was sought after for her consumer-products expertise, a major CEO slot that appealed to her didn't materialize. Some recruiters say her star power started to fade a bit. Says one: "It's hard to be out of the market for that long."
Finally, in April, Marram got the phone call that propelled her into the world of E-business. Brian M. Meany, a recruiter at headhunter Herbert Mines Associates, knew of her reputation as a driven brand-marketing star when he called about a tiny Net startup that was looking to hire top management. Marram cut him off 60 seconds into his spiel. "O.K., I get it," he recalls her saying. "Now, I've got some questions for you." In a five-hour meeting at New York's Peninsula Hotel, Marram quizzed efdex Chairman Tim C. Carron Brown on details of the business model and how much control she would have over shaping the company.EXPANDED REACH. At first, efdex's business-to-business plan didn't seem to lend itself to Marram's brand-building skills. But as she listened, she became intrigued by the idea of a global electronic business exchange that could radically expand the reach of food-and-beverage trading while making it more efficient. And Marram, along with the rest of the world, couldn't help notice as one Net entrepreneur after another racked up paper fortunes in the tens of millions. Still, she waves off any suggestion that she's out to make a quick killing in efdex's IPO.
Will efdex turn out to be the blockbluster Marram hopes to build? If not, no one will be more disappointed than Marram. Raised in a middle-class household in Boston, Marram was Type A right from the start. Her father, who ran a men's clothing store before going to work for the post office, would quiz her on politics and news at the dinner table. Marram's mother, a homemaker trained as a teacher and psychiatric social worker, stressed the value of school. Says Marram: "I was expected to achieve."RIDICULE--AND SUCCESS. And she did. Excelling in high school, Marram won a scholarship to Wellesley. There she developed a passion for economics, because it let her "read the newspaper more intelligently," and psychology, which helped her understand behavior. She tried to combine the two by canvassing blood donors for a paper on why people give. "Some felt it cost them nothing, and others felt they were giving life," says Marram. "It taught me that how people value things can differ a lot."
After Harvard B-school, Marram landed at Lever Brothers and two years later jumped to Johnson & Johnson's Personal Products Co. She switched to Standard Brands Inc. in 1977, which was acquired by Nabisco. In 1987, Marram broke into the big time when she took over as president of Nabisco Grocery Div. A year later, she became president and CEO of Nabisco Biscuit Co., where she came up with the idea of a low-fat brand of cookies and snacks. Nabisco veterans ridiculed the idea, informing her that indulgent snacks and low fat don't mix. Marram pressed ahead and developed the SnackWell brand. Launched in 1992, the brand became huge hit.
At Tropicana, she met with similar resistance--and success. The result: Tropicana was the first in the industry to apply sophisticated brand segmentation to orange juice. Grapefruit-splashed orange juice, juice with pulp, with extra calcium--they're all on the grocery shelf thanks largely to Marram. On her way to the top, Marram developed a reputation as a demanding boss. "She was very highly regarded," says Preskar of Marram's Nabisco days. "But she also intimidated some people. She kept them in line. She asked the tough questions."
Now, Marram will be asking more of the same at efdex. Transforming a minuscule Net venture into a moneymaking global exchange is a huge proposition. With her small staff and unproven business model, it won't be easy. On the other hand, this is the woman who gave the world a low-fat cookie that actually tastes good. Compared to that, building a new company from the ground up could turn out to be a cinch.By Diane Brady in Stamford, Conn.Return to top