In the 1980s, Gerald Ratner inherited The Ratner Group, which owned over a thousand successful low-cost jewelry stores across the U.S. and UK called Ratners. In 1991 Gerald was invited to speak at an Institute of Directors convening. "It was a prestigious event with thousands of the U.K.'s most powerful investors in attendance," writes Sean Kernan in Medium. Gerald wrote a speech and showed it to his PR rep, who told him to add some jokes, which he did. He showed the revised speech to his wife, and she told him to nix the jokes he'd inserted. He didn't. Big mistake — it cost him his career and his fortune.
From the Medium piece:
The beginning of his speech was standard procedure, celebrating his company's success and sales numbers. Then, halfway through it, he began making jokes playing off his brand's cheap reputation:
"Ratners does not represent prosperity — and come to think of it, it has very little to do with quality as well.
We also do cut-glass sherry decanters, complete with six glasses on a silver-plated tray that your butler can serve you drinks on, all for £4.95.
People say, 'How can you sell this for such a low price?' I say, 'Because it's total crap.'"
Then, he took it one painful step further saying,
"We sold a pair of earrings for under a pound, which is cheaper than a shrimp sandwich from Marks and Spencer, but probably wouldn't last as long."
The jokes drew roaring laughs from the crowd. But it would have a very different manifestation in the market.
The UK press quickly picked up on Gerard's jokes, and the working-class folks who shopped at Ratners were enraged by the insulting remarks. "By week's end," writes Kernan, "The Ratner Group's stock lost £500M in valuation ($1.5B today's dollars). By year-end, they'd lost another 80% of the company's value." Over 300 stores were closed, and "Gerald was forced to resign from his position as CEO. He was also forced to sell his shares, which he used to pay off his debt, leaving him with nothing."
He should have listened to his wife.