I believe that merchants are very important to a retail organization. They shape the future of their company with innovative and creative ideas. They are always on the lookout for new fashion trends. They visit stores and designers to learn and to see the future. Fashion leadership starts at the top and then permeates the whole store organization. Whether it is a color, a new look or a new allocation of space, it is the merchant who will decide. Some of retail’s top merchants I admire include Mike Gould, Roger Farah, Mickey Drexler and Karen Katz.
The CEO appointments of Brian Cornell at Target, Art Peck at The Gap and Marvin Ellison at J.C.Penney were all surprising and worrisome. All three are experienced men who have great knowledge of logistics, statistics, store operations or food operations. They lack the hands-on knowledge of merchandising and marketing – of finding true winners and occasionally making a mistake. I was excited when Macy’s elevated their Chief Merchandising Officer Jeff Gennette to President and Chairman-in-waiting three years before Terry Lundgren is expected to retire. That is a long time to train a true merchant in the fine details of leadership. I am also a fan of Katherine Buffano who went to Bon Ton as President and CEO from Belk Stores. She has hands on experience in merchandising and can step into the new job with good ideas and imagination.
Brian Cornell, 55, was appointed to head Target Corp. at a time when everything went wrong. His challenge is to restore consumer confidence following the high profile credit card breach, improve the sales momentum of the Canadian division, and bring new ideas to a tired organization. His past experience at PepsiCo’s food division, should be a plus as he pursues a turnaround at Target’s food operation. Prior to that he was President of Sam’s Club, President of Michaels Stores, and CMO of Safeway’s. His experience is terrific and will no doubt help him to stabilize Target. The turnaround will require him to address a better food strategy and presentation as well as the use of digital communications with Target’s guests. Right now, I am told, he is redefining the profile of his customers and how to adequately supply the stores.
Art Peck, 59, was hand picked by Glenn Murphy, the present CEO of The Gap who developed a new strategy for the fashion specialty retailer. With sales over $16 Billion the company can grow globally with its major divisions including Gap, Old Navy, Banana Republic, Athleta and Piperline. However, Peck held a number of strategy and operational roles in support of Murphy’s effort most recently working on an omnichannel initiative. A former management consultant, he lacks merchandising experience.
Marvin Ellison, 49, will report to J.C.Penney on November 1, 2014. It will be some time before I will meet him. He will be tutored by Mike Ullman, the present Chairman and CEO, who will stick around for 21 months. At The Home Depot, Ellison was Executive Vice President of stores, prior to that he was in charge of logistics. He also held several operating positions at Target. He is a well-liked, dynamic executive and I am sure he will quickly learn the in’s and out’s of merchandising--buying and selling goods to customers. This is nothing like the Ron Johnson debacle, when the new appointee pushed ahead like a steamroller without any guidance about customers and tradition, and then ruined the company with unacceptable ideas. This time senior management is sticking around to preserve the company that has been stabilized and now must regain momentum.
It Is The Customer That Counts.
In many ways the customer has changed. In this digital age she communicates quickly and makes decisions impulsively. She likes to shop at night and select merchandise on the Internet—even if it is then bought in a store. She is likely to use a mobile device and may soon look on her watch to communicate--like Dick Tracy did in the comics in the 1940’s! Her spending patterns have changed and her discretionary spending is impacted by her desire to have the latest hardware.
Retail Management Is More Complex.
I believe that merchandising and marketing experience is important for today’s senior leaders. However, there are other requirements that define a strong leader. It is a complex job. Strong leaders must have a vision for their company; they must be innovative so that their stores can distinguish themselves from the competition. They must also have financial and technology skills and understanding in order to support their store’s ability to communicate with their customers. They must be supportive of sustainability efforts and be aware of compliance regulations. Above all, as a strong leader, they must have empathy for their associates and have the passion to inspire them. They must also understand their changing customers.
Retailing Is An Exciting Profession.
Strong leaders that are creative can make retailing fun, innovative, and profitable. The ability to use new ways to bring customers to the stores is the opportunity for these new retail leaders.
