What will happen to Kohl’s after Michelle Gass goes to Levi Strauss?
Michelle Gass is stepping down as the chief executive of Kohl’s as of December 2 and moving to Levi Strauss & Co in January.
She will become president at Levi’s, a newly-created position, as part of a plan that will have her become the denim giant’s next CEO within 18 months, succeeding long-time leader Chip Bergh.
Ms. Gass has spent the better part of two years not only trying to steer Kohl’s through the pandemic but also battling activist investors who have sought to oust her from her job and take control of the retailer’s board. Their goals have been to force the company to sell itself outright, spin off its real estate assets and/or operate its digital business as separate from its brick and mortar operations.
Critics of Kohl’s during Ms. Gass’ tenure have argued that she hasn’t done enough to differentiate the chain from its many competitors. She has frequently pointed to Kohl’s relationships with Amazon.com and Sephora as driving customer traffic and add-on sales for the chain. Critics have pushed back that Amazon and Sephora gained more value from the relationship than Kohl’s.
The retailer announced in March that it is planning on opening 100 small-format stores, at about 35,000 square feet versus the company average of 80,000. The stores tout hyper-localized assortments to drive higher returns per square foot than the chain’s conventional stores.
Ms. Gass will be replaced on an interim basis by Tom Kingsbury, former CEO of Burlington Stores and executive vice president at Kohl’s. Mr. Kingsbury was nominated to Kohl’s board of directors by Macellum Advisors, one of the activist investors that has sought to take control of the retailer and boost its investment return in the short term.
“Despite a challenging economic environment, Kohl’s is well positioned for long-term success with its unique off-mall store footprint, omnichannel presence and loyal customer base,” said Mr. Kingsbury in a statement. “The board and I are committed to the continued refresh and innovation strategy Kohl’s has begun, the cornerstone of which is the terrific partnership we have with Sephora. I firmly believe in the long-term potential of this company, our associates and our ability to deliver value for shareholders.”
- Levi Strauss & Co. Appoints Michelle Gass as President – Levi Strauss & Co.
- Kohl’s Announces CEO Transition Process – Kohl’s Corporation
- Is Franchise Group’s plan for Kohl’s a retail disaster in the making? – RetailWire
- Kohl’s Concludes Strategic Review Process – Kohl’s Corporation
- Will Kohl’s make a better deal for itself after an activist investor loses board vote? – RetailWire
- Will smaller, more localized stores work for Kohl’s? – RetailWire
- Does this activist investor know what’s best for Kohl’s? – RetailWire
- Activist investors attempt takeover of Kohl’s board of directors – RetailWire
DISCUSSION QUESTIONS: What should happen at Kohl’s following Michelle Gass’ departure? How likely is Kohl’s next CEO to be more receptive than Ms. Gass was to calls by activist investors to monetize the retailer’s assets?