Scott Galloway, a Clinical Professor of Marketing at NYU Stern School of Business, founded L2, a think tank for prestige brands, with the aim of increasing brands’ digital IQs. Professor Galloway spoke with Beauty Insider about how his think tank came to life, his favorite sector of the prestige market and who are likely to be the icons of tomorrow.

BI: How did L2 Think Tank evolve?

SG:
It started as research conducted in my role as a [NYU] faculty member, trying to establish a link between digital competency and shareholder return. There was a lack of research in the luxury market so we issued a ranking of 100 iconic luxury brands on their digital competency. We sent the results to the companies on the list and in 72 hours approximately 50 companies contacted us.

BI: What was the reaction overall?

SG: The reaction was somewhat dictated by where they placed in the ranking. So, the brands at the top were interested and happy; the ones on the bottom wanted to be better. The big iconic brands that are used to the press fawning all over of them, and are often just average, were upset about the findings. About half of those who appeared on the list are now members of L2.

BI: Which category in prestige most fascinates you and why?

SG: Probably beauty. It’s accessible luxury and booming in emerging markets. The people in the beauty industry are very disciplined marketers. It’s a business-driven sector as opposed to creatively driven.

BI: What are some of your most surprising findings to date?

SG: Some iconic brands including Hermes and Prada don’t do well digitally and smaller brands including Tory Burch and Benefit score in our genius classification. These are likely icons of tomorrow.

BI: How is your company evolving in 2013?

SG: We are expanding into doing digital research on sportswear, CPG products and fragrances. We also started surveying our members more on e-commerce best practices and on different parts of their organizations’ social media structure. Next year we’ll do 40 events across the globe, as well as clinics in New York and Paris on the success of Facebook, mobile and e-commerce. Our events are now the largest gatherings for prestige executives in North America.

BI: Are you still teaching?

SG: I’m still teaching and on the faculty at NYU Stern. I have a good team of 25 full time employees and 15 Phd students that allows me to maintain a presence in both places.

BI: Do you have any investors?

SG: Just the man in the mirror. However, he can be unreasonable.