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welcome to Sloanies talking with Sloanies, a candid conversation with alumni and faculty about the MIT Sloan experience and how it influences what they're doing today. So what does it mean to be a Sloanie ? Over the course of this podcast, you'll hear from guests who are making a difference in their community, including our own very important one here at Sloan. I'm your host Christopher record. Welcome to Sony's talking with Sony's Today. I'm really excited to welcome don zero to the podcast.
So , uh, unless she be modest, let me just go through some of her accomplishments before she got to us. Here. She is currently the president and chief operating officer for activity health through and before that CEO for nutrisystem. We'll kind of cover how those two came to be before , um, institutional investor , uh , recognized her as one of the best CEOs in the country.
Uh, she was an e y entrepreneur of the year in 2018 which I want to talk about entrepreneurship in a , in a larger organization as well. She serves on numerous boards and she was with Reader's Digest Association for many years and led that towards a president of the international business , uh, with , uh , nearly a billion in revenue and a thousand employees. So welcome to the podcast.
Great to be here. So much fun to be in Cambridge. Yeah. What brings you to Cambridge ? Well , actually we're here, I'm here with tivity help health and we're doing, we're working with the age lab at MIT and we're having a symposium tomorrow, so first time up here for that and excited to be here dealing with the aging population.
Oh Great. And how, what's , what's the, what's the link with, with tivity and an age lab and yeah,
there's been a long relationship. Tivity health is best known for its brand silver sneakers prior to the acquisition in nutrisystem, which is, you know, a product for seniors in terms of keeping them fit. And then the age lab is all about how the aging population is moving, how, you know, I think 11,000 people turn 65 every day. So it's becoming a growing issue for us and how we, how we age gracefully and make sure that our seniors are taken care of.
Interesting. And so you before? Um, so talk about the , the, the tivity nutrisystem , uh , combination.
So that's, that's pretty much a new thing. So in March we combined forces tivity acquired nutrisystem. I had gotten approached in September by um , the CEO Tivity to Nada to Muto and he was interested in acquiring a nutrition based company so he could complete the formula of calories in which would be nutrition and calories out, which is the exercise part of it.
And for me as the CEO of nutrisystem, it was very interesting because we really are an ecommerce driven company and you know, really direct to consumer. But one of the things that I was interested in, in addition to just all the advertising and media that we currently did , um, was to really have other forms of distribution. So they have relationships with all the health plans. They, with 16,000 gyms. So a good opportunity to come together and really address a holistic solution around health.
Now in, in their case, their focus was on seniors, but nutrisystem, much broader than that. But I think it'll be interesting to see how the two brands have the two companies play together and can really address different, different ages.
Interesting. Now I know you're a data driven manager, so have you ever calculated how many calories you've saved people or the United States and all the , you know , all your clients. How many, how many , um , customers did nutrisystem have? Or does it have ,
uh , well, we have hundreds of thousands of customers, you know, a lot of customers out there, millions and millions, you know, over time. So , um , a lot of customers and um, we, we, I don't have the exact stat , but we have calculated it. And you know, what's, what's interesting to us is that what we realize is that tracking matters. And of course, we all do it in a more sophisticated way today with all of our apps.
But you're writing on with the phone, but really with your watch, but doing it on a piece of paper is just as effective. It's just how we migrate over time to more sophisticated ways of doing it, but still just really making sure you're writing down, you know , what you eat and what you don't is really important. And what I've learned was that I will make sure every step I take counts. I actually wore a fitbit often and then I kept washing them and they died on me.
So I carry around my iPhone with me and make sure I get my steps in. If actually I leave my iPhone, I will go back to pick it up. But as far as comes to tracking the food, that's a little different because like if I, if I take that candy kiss from my assistance desk, that doesn't get written down in the journal, but I make sure I get every steps . So we do tend to over give ourselves credit for our exercise and tend to underestimate our calories by as much as 20%
well on that note, I want to introduce a new segment here, which I call, there is no right answer. Okay . Alright . So you have to make a choice here. By the way, did you spend a lot of time in Fort Washington and , and , and nutrisystem? Yes. So , uh, I grew up in that area. So have you ever been to McGuirk ?
Yes, we have. We actually have had fun, Fun Halloween parties there.
I happened to have their menu in front of us here. Stephanie, I think you need to choose something from the menu here. So here it is. There is no, no right answer here. Right? And I think we should start with 30 of the wings, maybe the Maple Bacon, the sesame Teriyaki. Is that going to set us back at all in our, in our, in our plan on nutrisystem [inaudible] system at all?
We, I went there recently and my sister ordered the , uh , the Middle Eastern plate and I think it was about as wide as this table. It was just crazy. All right , so before I can let you look at that, but we'll come back to that in a minute. So here we go. There is no way . There is no right answer. Okay. We'll start easy. Uh , carrot sticks or celery sticks, carrots, the apple or a peach, apple chicken or fish? Chicken. Okay. Craft beer. Light Beer. Like hmm . Cheesecake. What she's played.
She's played interesting. M and m's or peanut Eminem's. O. M and M's. Reader's digest, sweepstakes or publisher's clearinghouse . Sweepstakes. Oh, readers digest sweepstakes. Come on doors .
So let's talk about your time here .
Just digests you , you , uh , took that to , to all new places. Um, tell me how that journey,
oh, it was great. It was so much fun doing 'em . I spent 20 years there, which is kind of amazing cause you look back and you never think you'll spend that much time in one company. But the company kept changing and I kept getting different experiences there. So went in , um, actually when I graduated Sloan, went to Chase Manhattan for a couple of years and then ended up at Reader's digest as a product manager and rose up there over time.
But the most exciting thing I ever did and I think one of the most professionally and personally , um, gratifying experiences was when I started to run Europe for Reader's digest and kind of actually brought me back to my Sloan days a little bit because one of the things I loved about the Sloan culture is the multinational part of it. The fact that we meet people from all over the world all the time and we find out something that the world actually is a pretty small place, especially these days.
And with Reader's digest, I was running Europe and then running international and working with 26 different countries and I realized it's something I really love. I'm really just just working with people across all different cultures. And I think that stemmed from my time at time at MIT
and obviously the business evolved . So I remember pigging finding the Reader's digest little mini book in doctor's offices or wherever they were. Right. So tell us about how that evolved and I think as in nutrisystem as well.
So, so I'm Reader's digest. It was, you know, the magazine, the little magazine was really the, the entree and it was kind of the, you know, talking little, little about profit and loss. It was kind of the lost leader that brought the customers in. And then what we did is it was a backend operation where it was all about books and home entertainment products that then migrated into jewelry, migrated into wine and a couple of other things around the world.
But , um, you know, it was about the customer experience. So one of the reasons that , um, what I loved about my education at Sloan and really keeping, you know, with the analytics of being an engineer but getting more business perspective was one of the reasons I didn't go into brand. Um, marketing. I went into direct to consumer because it was measurable.
And , um , you know, one of the things we looked at at Reader's digest, which is a skill set I took over to nutrisystem, was really understanding what each customer's worth and what's the revenue per customer. And , um, it was all about bringing them in and then really maximizing the experience. And of course, it's not just about selling them things. You have to actually really manage that customer experience and make sure that they're satisfied.
Yeah, it was, it was , um , reading some of the things on your a , it was an interview you did , uh , and you talked about how you have to really , uh , know how your customers evolve over time. And so when you joined nutrisystem it was not in great shape. Right . Um , so tell us about that, that process of particularly that first year, I think where the pressure was on to have some runs on the board.
Yeah. So, so I'm a big believer in celebrating the small wins and then, you know, they turn into bigger wins. You know, the number one thing is really to understand your customer. And we had a contact center at nutrisystem. It was interesting when I got there because the contact center was very much a different part of the company even though it was only a floor part.
So , um, you know, the business people didn't really seem to tap into the values of the contact center, which really is your first line of contact with the consumer while calling in customer service, counseling a sale. So a lot of calls coming in there and nobody ever seemed to talk to the contact center. And I came in, I started talking to them and what I found is that they actually knew a ton about the company and a lot about what worked and didn't work.
And over the years we began, we integrated that a lot more. But I think that was one of like a little , um, you know, gold nugget for us that we hadn't really optimized. And it's really turned into a lot of the great ideas that drove revenue for nutrisystem came from listening to the customer and listening to the contact center. And what's interesting, especially when you're in a business that's about weight loss, you know, every woman in the world will probably tell you she's an expert on it.
But what we really had to do was be careful not to be an audience of one, just because I've done something or you know, somebody else has done something that doesn't necessarily reflect the mindset of everybody else. So, you know, we all think we're experts, but I think this is where companies sometimes go with drift , is that you think you know more than the consumer and you're not actually tapping into them for those insights.
Well , Steve Jobs was famous for, you know , uh , saying that people wouldn't know what feedback to give him on the iPhone because they had never seen it before. And so how did you, was that, how did that work with nutrisystems as you introduce new products or applications or whatnot? What was over that you were there for how many years?
A six and a half years as CEO. And now we've sold the company in, in , um, in March, and now I'm there in a, in a broader capacity. Um, but you know, I think innovation, it's , it's really for nutrisystem, which is about weight loss and it has to be easy. It has to work.
So what I like about the product is it's scientifically backed, which obviously comes back to my roots and Cambridge and um, that, you know, the results, you know, we do clinical study, so there's a lot of science behind what we do. Um, but then it's also those softer things that you have to weigh in. And you have to think that the weight loss journey, it's one of the most emotional journeys that people go on.
It's not just about how you physically look, it affects your finances because there's a lot of health related issues. It affects your emotions. And a lot of times the emotions actually are the, are the driver of the physical.
And so, and, and the reality is also, you know, we're so time compressed these days and I'm so busy that I think we've become a generation as a soccer mom, as a football dad, whatever it might be, is that, you know, we get done every day at six o'clock with the kids sports and then we're, you know, fast food and through McDonald's or grabbing pizza. And so a lot of unhealthy habits. So, you know, we really try to understand what are the key drivers and then how we can innovate.
And it really is about, first it was about a 28 day program. Then then what we realized is people want a little more flexibility. So you have to build flexibility in one of the most exciting things we've done and we're still figuring out really how to monetize it is based off the trend of when everybody's doing ancestry or things like that to find out their genetic there . Um, you know, who are my relatives, who am I related to?
You know, we actually worked with one of the companies and developed a DNA body blueprint, which is all about nutrition. And that was kind of , that was kind of fun and exciting.
And how do you sign up people who are nervous about having that sort of test done and then later on, you know, being used against them in some way. And how do, how do you, how do you cover that concern?
Well, unlike some companies, you know, we don't share the data. So I think it comes down to data privacy. But the other thing is, you know, based exactly on what you said is that, you know, we're really just looking at the nutrition aspects. You know, there could be more information there if we decided and asked the customers if it would be okay to do that. But we're not going into the heavy route of, you know, the um, disease states or you know, are you predisposed for x, Y or z?
Um , you know, personally I choose not to know that sort of thing. Um , cause but I think that, you know, we kinda kept it safe or exactly for that reason. So I can tell you, you might be , um, lactose intolerant or you might have a gluten sensitivity issue. And you know, we tell you what macronutrients work best for your body, but it's not something that is going to , um, cause you any concern down the road in terms of information.
It actually really helps you get on course and know what's right for your body.
Interesting. So tell me, coming back to sown , you , you haven't an electric a degree, a master's in electrical engineering, computer science and an MBA. So six and 15, six and 15. So I love that for, for MIT talk. Yeah . Um, how did you, how did you evolve , uh, I mean, how did those, how did you get into those and how did you evolve into the , the NBA or did it all happen at once or
it was separate? It was separate. So I went to SUNY Stony Brook Undergrad and , uh , got my bachelor's in electrical engineering, computer science, and then I worked at 18 t and it was back in the day when companies would pay for you to go back to school. So any school that you could get into, you could go to. And I applied to MIT and got in and they paid for my master's in electrical engineering. Um, what I realized not so far thereafter is that that wasn't really my passion.
You know, I love the math, I love the science. I , and , and I would say that those experiences taught me how to think. The way I problem solve is very different. Like to say that the way my chief marketing officer problem solves , so I go left, she goes right. And if we somehow ended up at the same answer, you know, pretty sure it's right. Um, and you know, I like to joke with her, you know, when it's not right, you know, we know where to look.
But , um, but anyway , um, but I realized it wasn't my passion to be an engineer, but it was the foundational for me. And then I decided, okay, I want to go back to business and where do I want to go? I wanted to go to a place that really I felt would leverage my analytical background and would prepare me for, you know, things that I wanted to do, which, you know, one of the things I'm known for is the facts based culture. Always going back to those data analytics.
And Sloan was actually the perfect place for me. You know, it was, it was, I'm a smaller business school, but clearly, you know, I will say the best out there and um, you know, really was, was a good place for me to come back to. And you know, I always have an affinity for being back up here in Cambridge.
And I saw those trying to remember the acronym for factor. Was it focus, accountability, customer centric and team-oriented . Right. And then solution-based and solution-based. Oh mate. So Hey, that could be actually the assets almost like the fast five.
Oh, fast five. Yeah, fast five. Actually it was great for us. That was the first campaign we came out with , um, that the team had worked on . It takes about a year to form a campaign. And uh, so that was our 2014 campaign and it was about losing five pounds in, in one week. And it really , um, caught the attention of the consumers. It was clinically based. And then we grew from there with turbo 10, which was one month.
And then lean 13. We made some tweaks and actually found that, you know, customers could lose up to 13 pounds in one week. And that , that was kind of, you know, how we were growing the business. And then we introduced some new elements like the DNA body blueprint.
But one thing with dieting or weight loss, the weight loss industry is, it's tricky because it's about health and wellness, but, and you know, you don't really want to talk too much about losing weight, but at the end of the day, the way people measure themselves is by the weight loss. So it's a little confusing and there's a lot of sensitivity in terms how you ha in terms of how you have to have to address it out there.
Yeah, it's an obvious metric. Right? So that's the one that people go to and probably the one that makes you fit in your clothing better, whether you're fit or not. I learned a new term when I was researching you one called the doorstep . Doorstep economy or step economy. Yeah . So what does the packages delivered on doorsteps.
That's the way we don't want it . We don't want to move anymore. Right. And like moving is such an important part of our health, but please, please just give everything to my doorstep . So he just opened the door and sweep it right in or better yet. Why don't you just come into my kitchen and stock it for me? Right. Um, but yeah, the doorstep economy.
So what we feel is that, you know, looking at the way nutrisystem has always been a home for the many recent years has always been a product delivered into the home. So, you know, very akin to the way, you know, Amazon has really transformed our industry and we like to say, you know , we , we were there before that doing it. So what's interesting is that while in the past certain people accepted food into the home, now everybody kind of welcomes it.
So there was a macro change that actually I think is helpful to , um, you know, what we do.
And it's also, I think different to take out. It's more of a cook in or heat in or close to each meal being delivered individually. It's like a , a plan . Yep .
It's a plan. It's a system and it's easy because one of the things we're trying to address is the busy-ness of the lifestyle. So what we're finding is these customers get into these situations where they need to want to lose the weight. They often don't have the time to really do the meal prep or they would have been doing that already. So it really is about ease , easy and convenient.
What do you think you're going to add? The jds triple B?
Yeah, I'm looking at them . I'm looking at the local Mac and cheese, but I think my , uh, Sharon, my food development person would kill me if I suggested that.
Frizzell onions . Charles . Thank you. [inaudible] that's , that's great stuff. That is a good place. So how did you, what , tell us about your, your time at Sloan. Do you have a , a phrase , uh , favorite Sloan memory or anything you would put them do over?
You know, I , I loved my time at Sloan . I went to, I went to our 20 not to date myself. I went to our 25th reunion and didn't quite realize where I fell into the crowd. So, you know, we always have our little study groups and that's where you have your tight relationship. You know, what I realized was that , um, what I didn't realize at the time, but I was kind of the one that was the serious one and always kept everybody on task.
And it was funny to hear that because they're like, oh yeah, we would just give you the stuff you'd get the work done. And it really was a big team effort, but I never knew, you know, now, now in leadership, you kind of know where you fall into the, into everything. And um, yeah , it was interesting to see where my , um , my friends actually put me in that.
So that was an interesting revelation at our 25th at our, actually 20th, 25th, I don't remember, I'm not gonna date myself, but anyway, it was an interesting revelation. But one of the memories I have of Sloan and my husband who was not my husband at the time, but he always dating him, reminds me of is um, professor Yates . So Joanne Yates communication and presentation course. And apparently I was a bismal. So this is when you actually, you know, you have to prepare for the presentation.
They then record you. They then send you the video. And I made the mistake of actually sharing it with, with my , um, my boyfriend at the time who's now my husband. And he's like, Oh God, you're awful at this. You know, very , very supportive there. And I look back and that was really my first experience at really doing public speaking. And now I've been trained, you know, I'm much obviously much more comfortable with it, but I look at the kids today. My daughter is a rising senior at college.
My son, you know, is a graduate and they've had all this public speaking experience to a much greater extent than I did when I came to Sloan. So, you know, I look back at that course and think, okay, I probably could've done a better job there and it terrified me. But you know, you evolve, right?
And it was, and it's good because you do have to kind of, you know, I talked to my communications people, you know, when I go out on, on doing TV or media and it's something you never take lightly, you never can not prepare. So that's something that I've taken with me. And I think from that experience, I always make sure that I am prepared. I don't know that it's a do over. I think it was a probably got a late start at it.
And so when your travels at with a reader's digest, and I don't know if you've traveled much with nutrisystems , why not? Did you make a point of visiting classmates in different cities and countries around the world?
Well, you know, we're all over the world. So I would run into a couple of people in , um , in London. You know, I remember probably at Reader's digest, my most , um, exciting time was when I went to Moscow. And that was, you know, just kind of a surreal experience. It was, it was brilliant. But with nutrisystem I was kind of going to Detroit, Cleveland, other places, Reader's digest travels was a lot more exciting.
So you've had a lot of success if we, you know, read your bio earlier on. Um, what's your definition of success?
It's interesting because as much as I am an executive, I define my success in terms of things that are, you know, I kind of take my life in three buckets. So it's family, it's, it's work and it's friends. And if any two are working well at one time I'm set, I'm ready to go. If two are off kilter, forget it. It becomes really tough.
But you know, I, I actually, and maybe this is cliche, but the way I define my success is through my children and you know, have I taught them to be responsible adults? Have by taught them not to be entitled? Have I taught them to , with my husband to be productive citizens going forward and no longer is the definition just a US citizen. It's really a citizen of the world. So , um, you know, that's Kinda how I think of myself.
And one of the gifts I think I've been able to give my kids is through that reader's digest experience of really being able to see the world at a young age and, and appreciate that, you know, there's, you know, when you go through your career, there's lots of ups and downs and I don't think you can really define yourself by any one minute. You know, sometimes you're on the top, sometimes you're , you're , you're not. And it, it's kind of a cycle and things happen.
So if you define yourself by that as success, you're probably not going to be too happy. So I kind of tried to look for other things, but I've been fortunate with my career also.
Yeah, absolutely. So what was the , so between the e and the Cs and then the MBA, was there a gap in between? Was that when you went to chase and , uh ,
um, so I was, it was , um, I went, got my undergrad degree and then worked, went right away from my master's here, then two years at ATNT and then went up to business school.
Interesting hat . And how, when you think back on the education you got at Sloane and , and , uh, thinking about the relevance of an MBA degree, what sort of thoughts would you have for prospective students , uh , on, on choosing the school but also deciding whether to go and get a master's degree in business administration or not?
You know , I , I think, I think right now everything is so analytically driven and data oriented and I think Sloan always had that as part of their DNA in terms of teaching us as leaders how to be analytical and really dissect problems. And if anything, over time I think that's gotten more and more relevant.
And you know, everything we talk about and you know, I look at my , my career as a direct to consumer marketer at a time when I was doing it, being a brand marketer was more important , uh, was more prevalent and more recognize , more prestigious if you will. But my passion was always about that direct to consumer. And really that Geek in me of wanting to know what I was doing actually could be measured and I could see the results. Now what I'm seeing is, and, and it's a balance.
So it's not one, one extreme versus the others not good. But what I'm seeing is this more analytical approach to business actually is now what all the brands are looking for. So I think the way that Sloan , um , taught and I'm sure that, you know, the other business schools are doing it as , as well now. But I think Solon was pretty unique in its time in terms of how it was doing that. And for me it was a great background.
So I'm looking at the brands of uh , tivity health. You've got silver sneakers, which was part activity prior, right? And so the nutrisystem purchase brought over nutrisystem, South Beach Diet and the DNA body blueprint. What about the whole health living in and what, so what was the, what was the compelling , um, what, what tipped it over to this make sense to merge or,
right. So, so I think, I think what made sense is that, you know, first off the chronic care act, so plans were now able to reimburse for nutrition based products and that really hadn't happened to a large extent before. And also the plans are looking for not, you know, disjointed solutions. They're looking for somebody that can provide a holistic solution for them.
So I think for , um, the CEO tivity Denato that he was looking for a company that could complete that calories in versus calories out and would give expansion in terms of, you know, how can we better serve seniors? It's not just about the exercise. There's more that we can do and how do we become a platform for offering these different opportunities to the senior community.
For me as the CEO , CEO of nutrisystem, what I was looking for was to partner with a company that could get us more into the health, the health and wellness space, and um , provide opportunities for other forms of distribution. So not just TV or digital advertising, which we are expert at, but really getting into those , uh , having those relationships with the health plans.
And, and so really what we've combined as a sales organization, which is tivity and a marketing organization, which is nutrisystem, and there's opportunities to use all of our skillsets in a much more robust way. And you know what I like, I think the thing that cemented the deal across both companies is we're both mission-based.
Both companies were mission-based in terms of really wanting to help transform people's lives, you know, whether it be, you know, making sure seniors can stay active and more , have more vital, more, more vitality in their lives too . You know, nutrisystem, which is, you know, transforming people's lives through, through weight loss, which really does make a difference.
So, so what's next? So that's , um, it's been since March or probably wouldn't let it all came together. Yeah. Um , and you're this association with age lab here at MIT. Um, how does that w w what do you see? So the next couple of years , um , panning out and with, with activity.
Yeah , I think, I think there's a lot of , um , exciting things on the, on the horizon. So again, how do we offer those more holistic solutions to seniors? I, you know, redefining nutrisystem, not only as a weight loss company but what we are as a food science company or nutrition based company. So certainly for the consumer end we will be still focusing very, very heavily on weight loss, no pun intended there.
But , um, you know, we'll also have the ability to develop different products for chronic conditions for diet. We already have a diabetic product, but you can envision there's a lot more that we can do for people who suffer chronic conditions that might be reimbursable through, through the different health plans and also, you know, post-discharge . So I can see things down the road , um, elder care caregiver , um, things like that.
And then of course we'll continue to do what we do in weight loss. But you know, for me , um, what the acquisition has done is really expand our horizons of what we can do and we can do it more quickly because we came together as, as one unit.
Does the do the , the noises out of Washington with the affordable care act and sort of changes in the overall health regulatory environment that is that way on decisions of products and whatnot that tivity offers? Is it, or do you think you really can't put the genie back in the bottle after people understand food is an essential part of component , a component of health?
I think what we're seeing is as the aging boomers become seniors, you know, we, we've moved more into an environment where are the aging boomers are demanding more choice. So I think that plays well for the position that wherein, and then of course, you know, we're watching different things out there, you know, medicare for all and all of those things. Um, how that plays out. I think something like that would be actually a long shy, you know, is probably going to be something much more.
Um, you know, it's interesting and I'm sure it's years off, you know , with the way we , the way we move these days.
So last question. Any parting advice for prospective Sloanies?
Oh, I would say , um, again, you know, for me it was one of the best experiences I've had in my life. Um, it refined the way that I thought. It made me a critical thinker and I think the way Sloan blends the process of learning about business, but also putting that analytical slant on it really is great. And I think being part of a smaller business school, a renowned business school, but one that you know, you kind of know everybody in your class is , is a great place to be.
So FiveStars I'd say, you know, sign up, but you know, hard to get in.
So with that, I think we're going to order 30 of the gold rush, a wings, maybe a ninth street chicken. And I saw some in here, cheesecake, egg rolls or anything. You wanna share those?
Yeah, we can share those. That'll be good. And then we'll then we'll, I'll ship you some on nutrisystem for the following week . It'll be good. It's all good.
Thank you very much to Don's here for joining us on Sloanies talking with Sonny's . Thanks Sloan . He is talking with Sloanies is produced by the office of external relations at MIT Sloan School of management. You can subscribe to this podcast by visiting our website and mighty sloan.mit.edu/alumni or wherever you find your favorite podcasts.
Support for this podcast comes in part from the Sloan annual fund, which provides essential flexible funding to ensure that our community, you can pursue excellence. Make your gift today by visiting giving.mit.edu/slow
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