Money Losers of 2007: Whole Foods CEO John Mackey

Posted Dec 22nd 2007 5:10PM by Brian White
Filed under: Management, Whole Foods Market (WFMI)

John Mackey When a corporate executive begins to embrace the communication medium known as blogging, the world is generally a better place. In general, executives who blog are free from marketing censors and fluff that masks most corporate information -- from press releases to scripted quarterly results announcements.

Well, that is until one of them starts blogging anonymously in order to slam the competition and spread FUD all over the place. Mr. Mackey was caught red-handed this past summer posting anonymously to Yahoo!'s (NASDAQ: YHOO) finance message boards in relation to badmouthing natural food grocery competitor Wild Oats for a period of seven years. Mackey did not reveal that it was himself disparaging his competition at the same time Whole Foods Market (NYSE: WFMI), the company he founded in 1980, was considering a merger with its largest natural foods competitor.

When it was discovered what Mackey was doing, the FTC stepped in and halted the merger until it could assess what damage Mackey's postings might have had on Wild Oats in terms of financials. When a blog posting can shave off millions from a company's market valuation, serious questions come up on validity of what is said -- and this happened in Mackey's case. Fortunately for Mackey, the investigation did not take long and Whole Foods officially completed its Wild Oats buyout at the end of August.

Still, Mackey's goofy actions still stand as a representative piece of what some execs will do to trample on the competition in the faceless and nameless age of the internet. For his efforts, Mackey reduced his 2006 salary to $1 and reportedly sold his company stock portfolio to charity, saying that he didn't want to work "for the money" any longer. And then comes 2007's message board tirades. Mackey's back in town I suppose -- with a damaged rep and quite a bit less dough in his pocket.

Be sure to check out other Money Losers of 2007.

Tags: John Mackey, Mackey blogging, WFMI, Whole Foods, Whole Foods Market

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Reader Comments (Page 1 of 1)

12-23-2007 @ 9:15AM

Jeremiah said...

Very lame blog, Brian. You have mixed a few valid facts that you gleaned from other sources with your own FUD or flaulty memory - John had already given up his salary, and donated his stock options to a charity that he founded to help poor people all over the developing world. No one made him to this, he did it because he is a good man, a principled man. Yes, he made a mistake, due to his love of debate, and he admitted it. But note, that nothing he blogged adversely affected the stock prices of either company, because what he said was true. Does John now have less money, yes, and others have more; this is just one of the actions that other CEO's should emulate instead of the greed that they display. He is also why Whole Foods Market is always voted one of the best American corporations for which to work.

Jerry Cunningham
Austin, Texas

12-23-2007 @ 9:28AM

Brian said...

Thanks Jerry, for your comment. Having seen contexts and excerpts from Mackey's Yahoo! Finance forum postings, I have to completely disagree (have you read them?). Find them in Google's cache and judge for yourself -- I can't find any other way to describe his words and how "perceptions" created by those words could have affected the stock price of a competitor (one he was interested in buying , no less) outside of this post -- plain and simple.

Happy Holidays.

Brian

12-23-2007 @ 11:38AM

Jeremiah said...

Brian, Point taken on the "stock price" question. You failed; however, to answer my assertion that you made a false inference when you suggested, or rather stated, that John gave up his salary only after the FTC started their investigation. What say you about this?

Merry Christmas,
Jeremiah

12-23-2007 @ 11:59AM

Brian said...

Hard to say whether that $1 salary was in response to anything (Samaritan actions or as a response to *any* inquiry). It's my opinion, of course -- although the timing before or after is suspect. YMMV ;-)

Good day,

Brian