Does GameStop’s next CEO need brick & mortar retail experience?
GameStop’s c-suite shakeup is almost complete. The retailer is now looking to replace George Sherman after having replaced many of the current CEO’s top lieutenants in recent months.
Reuters and The Wall Street Journal report that GameStop’s move is being driven by Ryan Cohen, an activist investor who has been nominated to become the retailer’s new chairman of the board following the company’s annual meeting of stockholders in June.
Mr. Cohen, a co-founder and former CEO of Chewy, has been leading a sweep of the executive ranks at GameStop while taking leadership of a committee charged with driving digital transformation at the chain. He is also, according to the reports, in charge of the effort to replace Mr. Sherman, who has been CEO for two years. Mr. Cohen is not said to be interested in taking the job himself.
GameStop, according to the Journal’s reporting, is working with an executive search firm to identify and speak with executives that have experience in technology and video gaming. Brick and mortar retail experience, it seems, is lower down on the priority list for the new CEO.
Mr. Cohen has been responsible for bringing in veterans from Amazon.com, Chewy and QVC in recent months as he seeks to make the retailer into one that “delights gamers and delivers exceptional digital experiences” rather than focusing “on its brick-and-mortar footprint and [stumbling] around in the online ecosystem.”
GameStop, which has seen its stock go on a rollercoaster ride in recent months, posted a 6.5 percent gain in same-store sales during the fourth quarter as the retailer’s online sales jumped 175 percent.
Fourth quarter gains, however, were not enough to keep GameStop from posting a 9.5 percent drop in its same-store numbers as stores across the world were forced to close due to the novel coronavirus pandemic. This situation and the shift by consumers to get their gaming content via digital channels are the factors driving the moves currently being made under Mr. Cohen’s direction.
The retailer’s preliminary results for the first nine weeks of its 2021 fiscal year show sales up 11 percent over last year when many stores were closed or limited in their capacity to accept shoppers.
- GameStop initiates search for new CEO – sources – Reuters
- GameStop Working to Replace CEO George Sherman – The Wall Street Journal
- GameStop Announces Late of Director Candidates for 2021 Annual Meeting of Stockholders – GameStop
- GameStop Reports Fourth Quarter and Fiscal 2020 Results – GameStop
- GameStop Announces Preliminary Sales Results for the First Nine Weeks of Fiscal 2021 Reflecting an Approximately 11% Increase Compared to the Prior Year Period – GameStop
- GameStop hires Amazon, Chewy and QVC vets to transform its business – RetailWire
DISCUSSION QUESTIONS: Do you agree with the direction that Ryan Cohen is taking with GameStop? What role do you think the chain’s stores will play going forward?