Express CEO Michael Weiss to retire
Columbus, Ohio — Michael Weiss, who started with Express when it was an eight-store operation, will retire as CEO of the 600 plus-store specialty apparel company when its fiscal year ends on January 30, 2015.
He will be succeeded by David Kornberg, 46, president, who will assume the added role of chief executive. Weiss, 73, will remain with Express as nonexecutive chairman of the board.
Weiss started at Express in 1980, when it was an eight-store offshoot of Limited Brands, as merchandise manager. He became president in 1982, then CEO. He retired in 2004, only to return as chief executive in 2007 when Express was bought by Golden Gate Capital. Three years later, Express went public again.
“It’s been a joy and a privilege to lead this incredible business since its inception 34 years ago," Weiss said. “I will be leaving Express in the hands of a deep and talented management team, and I am confident that under David’s direction, the company will successfully evolve into an omnichannel brand.”
The change at the top comes at a pivotal time: In June, private-equity firm Sycamore Partners reported a 9.9% stake in Express and said it was interested in conducting due diligence that could lead to a buyout. Express has struggled recently, reporting a 10% drop in net sales and 11% drop in same-store sales for its first quarter.
Kornberg joined Express in 1999 and was named president in 2012. He began his career in the United Kingdom, at Marks & Spencer PLC. He briefly left Express in 2002 to serve as the VP of business development for Disney Stores and returned in 2003.
The economic trend for some time now has been a slow and meandering recovery. Despite improving consumer confidence numbers, a surprising first quarter GDP decline of 2.9% speaks to that uncertainty. Retail analysts and observers have a tendency to blame the weather whenever we have a bad economic quarter or when retail sales are unexpectedly sluggish, but I tend to be a little dubious of those explanations. Last winter was definitely rough enough to impact spending, but I don’t think it’s enough to explain the continued issues into the spring.
Now, with the recent release of the June retail sales numbers, the picture is only getting murkier. Retail sales rose just 0.2% in June. What is particularly interesting to me, however, is not necessarily the overall number, but numbers behind the number: specifically, how divergent the sales figures have become, not just from one company to the next, but within companies — from one brand to the next. For example, Banana Republic and Gap are down, while Old Navy is way up. Urban Outfitters is performing poorly, but Anthropologie and Free People are doing quite well.
From my perspective, this is new. We have seen some brands be a little up and a little down in the past, but the frequency and size of these swings feels like a new phenomenon. It is interesting to note that consumer confidence reflects a similar pattern. While consumer confidence bumped up in June, the larger pattern is relatively stagnant. I suspect the fragile nature of the collective consumer psyche might also go a long way to explaining why scandals like the Target credit card information theft can have such an outsized impact. Consumers are a skittish bunch these days.
The uninspiring economic numbers, uncertain recovery and tenuous consumer confidence might also explain some of the volatility and seemingly unusual patterns we are seeing in brand-specific performance. I think it’s telling that value retailers like Wal-Mart and Target haven’t seen the traction you’d expect in a predominantly value-driven shopping environment. At the other end of the spectrum however, Gap and Banana Republic are also doing poorly (both were down 7% in June). It is in the middle where the action is, as mid-level brands like Old Navy (which was up 7% in June) report stronger numbers.
We may be at a point in the post-recessionary era where we have recovered “enough” that consumers are moving away from strictly value, but that the lackluster nature of the recovery is preventing a true resurgence in some mid- to higher-end brands. Essentially, both ends are getting squeezed and some higher-end retailers and general/mass merchants might continue to face some structural challenges. You could make a similar argument in the restaurant sector, where price leaders like McDonalds have struggled of late, while fast-casual upstarts like Five Guys and Smashburger have thrived.
As for what this all means for brick-and-mortar, it’s a little more complicated. If there is a broad conclusion to be reached here, it might be this: in the current economic climate, big-picture trends are elusive and traditional assumptions are only so helpful. You really have to look at each individual retail brand in its own context as it relates to price, quality, service, product depth and variety, and whether the brand is effectively speaking to consumers.
It’s worth noting that despite the brand-to-brand sales variations at some companies, there are broader multi-brand retail success stories right now. All three major TJX Companies brands — Marshall’s, Home Goods and T.J. Maxx — are doing well, which is especially interesting as it runs counter to the struggles that so many other discount and value retailers have experienced. I’d love to get your thoughts on what that might mean. Are they doing something different? Is there something special about Marshall’s, Home Goods and T.J. Maxx? Is this the exception that proves the rule, or is it an indication that the retail marketplace might be even less predictable than I suggested? Leave a comment below or email me at [email protected] to keep the conversation going.
Click here for past columns by Jeff Green.
Hhgregg marketing chief tapped as GRMA’s 2015 advisory board chairperson
The Global Retail Marketing Association (GRMA) advisory board has named Hhgregg’s chief marketing officer Julie Lyle chairperson for 2015. Lyle succeeds Brian Beitler, EVP and chief marketing officer, David’s Bridal, who served as chairman from 2012 to 2014.
Leading the GRMA advisory board, Lyle will serve as senior adviser to Stephanie Fischer, president and CEO of GRMA. Lyle will also steer the board, made up of retail CMOs and leading supplier partner executives, to shape the organization’s strategic focus and drive thought leadership within the retail space. In addition, Lyle will spearhead the GRMA member candidate selection process, ensuring the organization remains a community of the foremost CMOs and executive decision makers.
“The mission of the GRMA is to empower each of our members to affect positive change and shape the future of retail. Julie is one of the most forward-thinking marketers that I know, and an ideal chairperson for GRMA as we embark on new thought leadership initiatives,” said Fischer. “I’ve seen firsthand the caliber of Julie’s leadership, and she is well respected within our organization. There’s no question that as chairperson, she’ll make a huge impact on the organization and continue to push innovation within the retail industry.”
Under Lyle’s leadership, the GRMA will expand its resources for retail executives, launching several thought leadership initiatives including interactive webinars with industry experts, retail industry research and content such as case studies and white papers. The GRMA will also unveil a new, invitation-only online community for retail executives and regional workshops. These initiatives are focused on the strategic needs of retail executives and will foster industry-wide discussions, resulting in fresh ideas to drive the future of retail and innovation.
“Through collaboration and innovation, the GRMA is changing the face of our industry, and I’m proud to serve as the 2015 chairperson,” said Lyle. “Bringing together the brightest minds in our industry helps us solve problems and develop ideas on a global scale, ultimately driving value for our companies and better serving our customers.”
Lyle will also work with the advisory board to drive program development for the 10th annual GRMA Executive Leadership Forum, ensuring it addresses the unique challenges facing retail CMOs.