Macy's reorganizes management structure, eliminates Chief Operating Officer position
In a strategic move to adapt to the evolving retail landscape, Macy's has made significant changes to its senior leadership. These changes aim to accelerate the company's transformation to better compete in an industry dominated by e-commerce and the decline of traditional malls.
The retail giant has eliminated the chief operations role and appointed new leaders with expertise in digital transformation and customer experience. Bennett Fox-Glassman, appointed as SVP of Customer Journey, will drive customer obsession through unified experiences, personalization, and leveraging insights and technology across Macy's platforms.
Macy's has also focused on enhancing its digital and customer experience capabilities. The appointment of leaders like Fox-Glassman reflects a deliberate emphasis on driving customer obsession and leveraging technology to compete against pure e-commerce rivals.
The pandemic has drastically diminished mall traffic, questioning the viability of Macy's traditional department store model heavily associated with these venues. By evolving senior leadership with expertise in digital, transformation, and customer strategy, Macy's aims to accelerate its omnichannel capabilities to better serve customers wherever they shop.
In addition to these changes, Macy's has simplified its assortment and focused on 'off price' as its value proposition for the brand. The company has also announced changes in its Polaris turnaround strategy in response to the pandemic's impact on the retail industry.
Macy's has not been alone in these changes. The rise of e-commerce and the downfall of malls are among the shifts in the retail industry accelerated by the pandemic. Companies like Best Buy are also making changes due to the impact of technology on consumer shopping behavior. Best Buy announced a 17% year over year cut to its workforce, shifting the emphasis toward more part-time workers, and the closure of more large-format stores.
Tractor Supply, Target, and Best Buy are contrasted as they have not experienced the same level of cuts as Macy's. Macy's has announced a cut of nearly 4,000 corporate jobs last year, aiming to save $630 million annually.
Macy's store portfolio has been significantly reduced, with 100 locations closed a few years ago and another 125 announced to close over three years. Douglas Sesler, who has been leading Macy's real estate strategy for five years, will be replaced by Chuck DiGiovanna. DiGiovanna will report to CFO Adrian Mitchell.
The intention behind these changes was announced in a filing with the Securities and Exchange Commission. Marla Beck, co-founder and CEO of Bluemercury, will leave Macy's this summer. John Harper, the COO of Macy's, is departing the company on Aug 1. Laura Miller will take the CIO role at Macy's, replacing Naveen Krishna.
Macy's is also expected to be more aggressive in its real estate strategies, according to Jan Rogers Kniffen, CEO of J.Rogers Kniffen Worldwide CEO. Macy's Retail Holdings intends to offer $500 million in senior notes due in 2029, with the proceeds including repayment of debt.
In summary, Macy’s leadership changes are considered necessary because:
- The retail pandemic impact required a rapid shift from mall-centric to digital-first strategies.
- Senior leaders with expertise in digital transformation and customer experience are critical to this shift.
- These changes aim to unify online and offline customer experiences to compete against e-commerce giants.
- The leadership transitions provide Macy’s the agility to adapt in an industry facing structural changes due to consumer preference shifts.
This alignment of leadership capabilities with strategic imperatives reflects Macy's recognition that post-pandemic retail success depends on nimble, digitally-focused decision-making at the senior level.
- The pandemic has necessitated a transformation in Macy's retail strategy, shifting from a mall-centric approach to a digital-first focus.
- To accelerate this transformation, Macy's has appointed new leaders with expertise in digital transformation and customer experience.
- These changes aim to offer a unified customer experience across Macy's platforms to compete effectively against e-commerce giants.
- As the retail industry faces structural changes due to consumer preference shifts, Macy's leadership transitions provide the agility needed to adapt.
- Post-pandemic retail success depends on nimble, digitally-focused decision-making at the senior level, a recognition reflected in Macy's alignment of leadership capabilities with strategic imperatives.
