April 20, 2017
W.l Mellon Speaker: Susan Packard Talks Trust, Leadership and Creating Success
If there’s a secret ingredient in Susan Packard’s success, it’s this: constant communication.
A cable television executive since the go-go days of HBO — when the most feared technological threat was the VCR — Packard has built a career on three principles: staying connected with customers and colleagues, keeping her organizations fresh with innovation and exhibiting courage to implement new ideas. And the common thread running through all of those, she said, is communication.
Packard, co-founder of Scripps Networks Interactive and former chief operating officer of HGTV, shared her insights on leadership with Tepper School students as part of the W.L. Mellon Speaker Series. A self-described “unlikely leader,” she credits her success to learning from a series of mistakes, finding ways to add value to her customers’ lives and applying liberal doses of good humor to smooth the path along the way.
Her foray into creating cable television networks from scratch really began when, after eight years with HBO, she was invited to help turn around Z Channel, a small cable network with a cultlike following in Los Angeles. The network showed all kinds of movies — documentaries, directors’ cuts, classic films, and first-run hits — but was struggling financially. When the Z Channel’s new owners considered adding local pro sports to broaden its audience and distribution, Packard agreed.
Unfortunately, the viewers did not. The decision proved so costly that the network was ultimately disbanded, and Packard said she learned a key lesson that she has carried with her since: Know your audience.
“If I had only thought to connect with our viewers before we made that radical change to their little gem of a network, I would have learned that scheduling a Fellini film followed by a Clippers game wasn’t going to keep our audience,” she said.
When HGTV was in its startup phase, Packard was vocal about the need to know who the viewers were before the network could proceed. The team agreed, but nobody really knew how to solicit audience feedback with cable operators and satellite TV providers serving as natural impediments.
The sole team member without a television background suggested setting up a call center, and putting the center’s number on at the end of shows. Although it seemed like an odd solution, it wound up being exactly what the fledgling HGTV needed.
“I will tell you that diversity is a huge component of innovation,” Packard said. “If you can sit around a table with people who don’t look like you, who don’t come from your background, you will learn that collective is so powerful.”
The call center revealed which shows viewers wanted, which ones they hated and other helpful information, such as viewers’ desire to purchase items they saw on the shows.
“Those kinds of pivotal moments of learning that we got helped us to continue to steer the ship in the right direction,” Packard said.
Based on call center feedback, the network attempted unsuccessfully to partner with Home Depot. They next tried Lowe’s, offering favorable advertising rates in exchange for putting HGTV’s information in their stores. It worked like a charm.
“In those markets, where we were able to participate physically in their stores, we had better distribution — quicker distribution — than in other markets. And that was the power of this partnership,” Packard said.
Additionally, in markets where HGTV existed first, subsequent Lowe’s stores performed better than average.
“That’s what partnerships are about. It’s about reciprocity,” Packard said.
The network also experienced a setback when it purchased Shop At Home, a flailing shopping channel, with the idea that they would sell home and garden products that had appeared on the shows. The idea completely flopped, ending in a large write-down and liquidation of the business. Packard blamed the failure on a lack of retail knowledge within her company.
“In this case, we had the model wrong,” she said.
To illustrate how wrong, she showed the audience a video clip of a host who injured himself on camera while wielding a Japanese sword, prompting an off-camera crew member to appear and suggest emergency surgery.
“You can’t make this stuff up,” Packard said as the audience laughed. “You really have to look at how you want to expand, and make sure it’s in the sweet spot of what you already do well. Otherwise, there can be too much risk.”
Today, the network licenses its brands to retailers, which turned out to be a much more successful model. And what started as HGTV is now a collection of six profitable brands on several platforms in more than 200 countries worldwide.
Packard believes that having the opportunity to help create the corporate culture at HGTV afforded her the ability to use missteps as guideposts toward future triumphs — again, drawing on communication to build trust.
“Trust allows you to make mistakes — to act a little crazy as you innovate. And you don’t feel like anybody is going to punish you. Trust allows you to have some emotional happiness at work with people that you connect with,” she said.
She worried aloud that increasing mobility in the workforce and the proliferation of technology might hamper opportunities to build trust. She urged the audience to seek out a corporate culture where they notice a commitment to innovation and an environment where they feel valued.
“Innovation is hard work ... but it’s really worthwhile work if you create products and services that fit a need,” she said. “I hope you all have the pleasure of the kind of experience that I had in building this business. It’s very special, and look for it. You deserve it.”