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Getting Real -- And Getting Real Rich


You don't get to be where Phillip C. McGraw, a.k.a. Dr. Phil, is in life without relentlessly promoting yourself. He's sitting pretty just behind Oprah Winfrey as the country's most popular talk show host and at the center of his own multimillion-dollar brand. On his program last fall, he selected 13 overweight people to live in a Beverly Hills mansion for a week while he put them through a rigorous fitness program -- based, naturally, on the diet and exercises that he extols in his book, The Ultimate Weight Solution. As McGraw sent his volunteers off, he offered stern advice to all the overweight members of his TV audience: "I want you to use my new book, this show, DrPhil.com to follow along." Ask him how to solve America's obesity epidemic and he doesn't hesitate: "Everyone needs to read my book."

McGraw, 53, is building a personal-brand empire around his two-year-old show the likes of which we haven't seen since Martha Stewart's glory days. He even incorporated himself back in 2000. McGraw, a psychologist, doles out his in-your-face advice on topics ranging from marital strife to child rearing. And he's not afraid to tell people they're fat or bad parents or just outright blithering idiots. For those who can't take it, tough luck. "I'm not for everybody," he says as he lounges in his safari-themed Hollywood office after a recent taping.

When he's not scolding his guests in front of his 5 million TV fans, he has managed to pen four best-selling books; his fifth, a cookbook, came out in late May. He also admonishes America in a monthly newsletter, Dr. Phil: The Next Level, published by American Express Custom Publishing and in a column he writes for O, The Oprah Magazine, published by the feel-good queen, who first invited McGraw onto her show in 1998.

Last year, McGraw lent his name and likeness to Shape Up, a line of weight-loss pills and foods started by a former business partner. Should someone want even more Dr. Phil, they can buy T-shirts and mugs with his picture on them and photo frames engraved with the words "I Love Dr. Phil" on his Web site. (He declined to reveal sales figures.) And in the ultimate brand extension, he has brought his son into the act. Jay McGraw, 24, has written teen versions of three of his father's books and regularly appears on the show.

SHIP OUT, SHAPE UP

But a growing band of detractors believes McGraw's entrepreneurial zeal is becoming unseemly. They argue that he is capitalizing on his celebrity status by positioning himself as an authority on any number of serious psychological and medical issues -- from how to talk to kids about the photos of prisoner abuse in Iraq to how to lose weight -- that he may not be entirely qualified to address. "It's not clear he's staying within the limits of his expertise," says Peter M. Barach, a psychiatry instructor at Case Western Reserve University. After all, they add, the guy hasn't had a real practice in 15 years.

Some marketing experts contend McGraw is over-hyping his brand to the point where he could turn off people. "I'm not sure he's around in five or 10 years. I have a sense he knows that and is milking it at every step," says Peter Sealey, a visiting professor of marketing at Stanford Graduate School of Business.

The criticism is not just an academic consideration. In March, three consumers filed a class action against McGraw and the makers of Shape Up, alleging that ads for the supplements, bars, and shakes make several claims that nutritionists dispute: that the products reduce cravings for carbohydrates and help dieters change their behavior to take control of their weight. "These products don't change people's behavior," says Henry Rossbacher, the Los Angeles lawyer representing the plaintiffs. "That's false advertising, and it's illegal." McGraw, who donated his endorsement fee to his foundation, which funds research into childhood obesity, contends that the products are healthy alternatives to fattening snacks. Still, the complaints gnawed at the TV doctor, and he recently ended his endorsement deal.

The Shape Up controversy isn't likely to do too much damage to McGraw, though. His show, which he produces in partnership with Viacom Inc. (VIA) unit Paramount Domestic Television, drew $81 million in ad revenues last year, handily beating other syndicated juggernauts such as Wheel of Fortune and Seinfeld. McGraw won't reveal his cut, but he doesn't dispute estimates that he'll pocket $15 million this year -- in addition to $1 million in speaking fees and a reported $10 million book advance.

IMPATIENT WITH PATIENTS

McGraw began honing his straight-talking style long before anyone turned a camera on him. At the University of North Texas, where he earned a PhD in psychology, McGraw stood out as an assertive and somewhat odd student. "Midway through one semester, he came up to me and said: 'Let's renegotiate this whole class business,"' recalls G. Frank Lawlis, one of McGraw's professors and now a consultant to his show. McGraw wanted the class to spend more time debating psychological theory. Lawlis was so impressed with his student's chutzpah that he decided to give the approach a try.

But McGraw's in-your-face style didn't work as well when people were paying for his advice. As a psychologist, he was tempted to tell his patients to "get real," as he often says on his show. "I had no patience for my patients," McGraw jokes of his 10 years in practice.

So he began dabbling in business. His most successful venture was Courtroom Sciences Inc., a legal consulting firm he co-founded in 1989. (He recently sold his 50% stake because he no longer has time to devote to the company.) CSI quickly built a roster of clients in the oil and entertainment industries, including Winfrey, whom McGraw counseled after she was sued by cattle ranchers for expressing her fear of mad cow disease on the air.

These days, McGraw is writing his sixth book, which he describes as a manual for parents, and in May he announced that CBS will air a prime-time special this fall timed to the book's release. And his newsletter is about to get a major marketing boost from its publisher. With all this, it seems unlikely that Dr. Phil would care to appease his critics by easing up on the self-promotion. As he might say: Get real.

By Arlene Weintraub in Los Angeles


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