Professor Profiles: Goizueta School’s Daniel McCarthy

Having the opportunity to learn from the best and brightest minds in business is one of the top motivators for many applicants considering an MBA degree at an elite business school. The professors and lecturers you’ll encounter have worked in the trenches, and bring an incredible wealth of real-world experiences into the classroom setting.

In our new limited series of professor interviews on the SBC blog, readers will get to know a bit more about these brilliant academics, what fields most excite them, the trends they foresee, what they enjoy most about teaching at their respective universities, and how it all comes together with their students.

Today, let’s meet Daniel McCarthy, assistant professor of marketing at Emory University’s Goizueta School of Business.  McCarthy is also the co-founder and chief statistician of Zodiac, a predictive customer analytics platform.

Education: 

• Ph.D. in Statistics, The Wharton School, University of Pennsylvania, 2017
• B.S. Economics Summa cum laude in Statistics and Finance, The Wharton School, University of Pennsylvania, 2006
• B.A.S. Summa cum Laude in Systems Science Engineering, University of Pennsylvania, 2006

Course(s) taught: Marketing Research

What triggered your interest in your subject matter?

Customer-based corporate valuation, my main research topic, brings together all of the disciplines that I love the most – finance, statistics and marketing. I spent 6 years working at a valuation-based hedge fund before going back for my PhD in Statistics, and in the middle of my PhD, I pivoted into quantitative marketing. It was a match made in heaven.

Any surprising or unique applications of your field of study?

While my co-author Peter Fader and I have applied my valuation methodologies to several companies, the results of the analysis that I performed on meal kit delivery company Blue Apron yielded very striking results. I performed my analysis on Blue Apron the day after they filed their IPO prospectus, back when sentiment towards the company was very positive.

My assessment was decidedly less optimistic, revolving around rapidly rising customer acquisition costs and poor customer retention. The work ended up going viral, and has been featured in popular media such as the Wall Street Journal, FT, Fortune, BusinessInsider, Barron’s, and more.

What are you most excited about that’s happening in your field?

It is exciting to see how much mindshare customer-based corporate valuation has acquired in such a short period of time. I would have never predicted one year ago that CNBC’s Jim Cramer would be discussing my research on Wayfair during his show, but here we are.

Sell-side equity research firms are writing entire research notes dissecting and discussing the concept. Every new IPO comes with requests for comment from popular media outlets. It makes me very optimistic about where will be at this time next year.  

Can you speak to interesting trends in your field?

We are starting to see corporations, and not just investment funds, adopting customer-based corporate valuation into their business operations. I anticipate that this trend will continue. It only makes sense that companies manage customer value and its behavioral determinants – customer acquisition, retention, and monetization – more diligently.

Best advice for an aspiring business mogul?

A traditional product-centric mentality will not cut it anymore. To create durable value, companies need to replace this with a customer centric mentality. When companies launch new products, the question is not how much sales those new products will generate. The question should be how much those products will expand the lifetime value of the company’s current and future customers.

Of course, before you can manage your business around customer value, you need to be able to measure customer value. The measurement problem may seem daunting, but it is (1) an essential prerequisite and (2) getting easier and easier by the day.  

What can you do in the classroom to best prepare students for the real world?

I prepare students for the real world in two main ways. First, I spend a lot of time making sure my course content is relevant and actionable. Second, I do my best to bring my business background into the classroom to provide students with real-world examples of the concepts I teach “in my own voice.”

Third, a large components of my students’ final grade comes from a final project in which they use the tools they learn in class to perform marketing research on a new product or service, because what better way to internalize marketing research than through experiential learning.

What do you like about the school you are teaching at?

Emory has been a wonderful home on many levels. My marketing faculty colleagues could not be supportive of me. The administrative staff has been equally supportive, always looking for exciting new opportunities for me to shine. The students are sharp, engaged and interested. And who can beat Atlanta in the winter time?

Thank you Professor McCarthy for making time to share your insights with our readers!