Will a former H&M exec lead Forever 21 into a bright new future?

Discussion
Photo: Getty Images/zodebala
Feb 27, 2020
George Anderson

Authentic Brands Group, Simon Property Group and Brookfield Property Partners rescued Forever 21. Now, the fast-fashion chain’s new owners have found a chief executive officer in the person of Daniel Kulle, a 20-year veteran of H&M.

Mr. Kulle most recently served as a strategic advisor to former H&M Group CEO Karl-Johan Persson and was part of a steering group for three digital startups within the company. He is also a former president of H&M North America, where the business grew to 600 stores across the U.S., Canada and Mexico under his leadership. Sales during that time went from $1 billion annually to $4 billion.

“Knowing Daniel personally for several years, I’ve seen his tenacious working style first-hand,” said David Simon, chairman, CEO, and president of Simon. “His strategic vision and experience will build on Forever 21’s heritage and undoubtedly usher in a new era for the brand.”

Mr. Kulle is expected to put his digital experience to work in bringing Forever 21’s brand content and social media strategies in line with modern consumers. He will focus on bringing new life to the chain’s merchandise, and work to provide a seamless shopping experience via the retailer’s site and stores.

Forever 21’s new CEO is also going to look to bring more fun and energy into shopping through pop-ups and “unexpected brand collaborations that continuously surprise and delight customers.”

Sustainability initiatives are also seen as a key pillar in Forever 21’s strategy. Like other fast-fashion retailers, the chain is increasingly faced with consumer pushback against a throwaway lifestyle.

Mr. Kulle’s former employer, H&M, has made sustainability a key tenet of its operational and brand strategy. The Swedish retailer has pledged to use 100 percent recycled or sustainable materials in its products by 2030. It also expects to be carbon neutral through two tiers of its supply chain by 2030 as it moves to its goal of being 100 percent climate positive by 2040.

In many ways, Mr. Kulle appears to be walking into an ideal situation at Forever 21. The chain has new owners (AKA landlords Simon and Brookfield) with a real stake in its success. The two mall operators and Authentic Brands have also worked successfully together in the past with the acquisition of the bankrupt Aeropostale chain in 2016.

DISCUSSION QUESTIONS: Is the hiring of Daniel Kulle the right move for Forever 21? What do you think are the biggest needs to be met if Forever 21 is going to be successful going forward?

Please practice The RetailWire Golden Rule when submitting your comments.
Braintrust
"Forever 21 has a big opportunity under Mr. Kulle to reinvent itself as the fun, fashionable, on-trend, more affordable, sustainable sister to H&M."
"If Mr. Kulle can apply what he learned at H&M to Forever 21, he has a good chance at a turnaround."
"I wish Daniel Kulle much luck. I’m sure he has tremendous talent, ability, and knowledge in the fashion industry, but his mission is not one that will be easy to accomplish."

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8 Comments on "Will a former H&M exec lead Forever 21 into a bright new future?"


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Mark Ryski
BrainTrust

Daniel Kulle certainly appears to have everything new ownership would want in a CEO, and so in this regard it’s a good move. Forever 21 is a bruised and battered brand and it will take time bring it back to the life it once enjoyed. Kulle’s credentials suggest he has all the experience/expertise to engineer a turnaround. That said, the biggest challenge may be in the increasingly negative view of fast fashion, and that’s not something a new CEO can necessarily change.

Neil Saunders
BrainTrust

There is no doubt that the appointment of Daniel Kulle is a good one. He brings relevant retail and management experience into the business. However, the long term survival of Forever 21 is still in the balance. There is a swing away from fast fashion, which is impacting most retailers in that segment, Moreover, there is enormous competition in the apparel sector with lots of discounting and margin erosion. On top of that many of the fundamentals of the Forever 21 business are not optimal, especially stores which are far too large and need investment. Different ownership, especially as it is by property companies, may give the company more room to resolve its challenges. However, there is a long road still ahead and its destination is not entirely clear.

Art Suriano
Guest
I wish Daniel Kulle much luck. I’m sure he has tremendous talent, ability, and knowledge in the fashion industry, but his mission is not one that will be easy to accomplish. For too long, Forever 21 lost its impact in the marketplace. They have been suffering from too much competition and too much “sameness” in trying to be like everyone else. Fashion changes quickly, and many young people today are less motivated about fashion and dressing in style. So how will Forever 21 be successful? The key is by being different, offering something different and “wowing” the customers, so they become loyal to the brand, which means repeat business. Currently you could take the name off many of the fashion apparel stores and you couldn’t tell who they are because once inside, they all appear to be the same. That is where Mr. Kulle has got to put his focus. How does he make Forever 21 different from the many other fashion apparel retailers, and how does he bring that same experience to the web?… Read more »
Jeff Sward
BrainTrust

I am highly optimistic based on the precedent of what ABG accomplished with Aeropostale. ARO was a mess under the old management. It wasn’t bad product or bad marketing. It was was undisciplined execution. It was floor set after floor set of four pounds jammed into a two-pound bag. “More” always seemed to be the answer. The new ARO doesn’t seem to have changed the product or brand promise, but they look like they are executing with a high level of discipline. Two pounds in a two-pound bag. Several visits in January and February showed lower levels of prior season inventory than many competitors. So if ABG and Mr. Kulle bring that level of execution to Forever 21, I think the $81 million price tag will turn out to be one of the better retail investments in recent history.

Richard Hernandez
BrainTrust

The choice to have him lead the ship is a great choice, my only hope is that they give him adequate time to evaluate the business in order to make the changes needed. Forever 21 stores are too big, and there definitely needs to a review of their assortment.

But with that said, I don’t know how much can be done with brick-and-mortar fashion stores based on the current business climate.

Dick Seesel
BrainTrust

The original idea of “fast fashion” was to bring trends and key items to market very quickly (and affordably) through adept supply chain management. As Forever 21 overexpanded, it gave fast fashion a bad name because of its low quality and confusing stores. Off-pricers took over as the “treasure hunt” stores of choice.

But stores like Zara and H&M have managed to bring order to the chaos, while broadening the appeal of fast fashion to older customers. If Mr. Kulle can apply what he learned at H&M to Forever 21, he has a good chance at a turnaround.

Cynthia Holcomb
BrainTrust

Forever 21 will reinvent itself under the influence of H&M and the contemporary leadership of Daniel Kulle. Forever 21 has a place in the business of fashion, versus the dearth of retailers selling boring basics with a twist. In the area of flipping the “fast fashion” issue to a positive sustainability promise, Kulle earned sustainability street creed via his leadership as President of H&M North America. From a retail fashion perspective, Forever 21 has been the stepchild to H&M, with both retailers reliably translating in-the-moment trends directly to the retail floor. Unfortunately, Forever 21 became addicted to fast fashion, high on the drug of executing every single micro-trend into cheap, large-scale fashion assortments of shoddy merchandise. Too much of too much! Forever 21 has a big opportunity under Mr. Kulle to reinvent itself as the fun, fashionable, on-trend, more affordable, sustainable sister to H&M.

Craig Sundstrom
Guest

I would call it hiring away from a competitor — a very standard, even “safe” move, so judge accordingly. I also find it rather ironic, though, that one of the things being touted here is Mr. Kulle’s having grown H&M’s store count, since over expansion is often cited as one of F21’s problems.

wpDiscuz
Braintrust
"Forever 21 has a big opportunity under Mr. Kulle to reinvent itself as the fun, fashionable, on-trend, more affordable, sustainable sister to H&M."
"If Mr. Kulle can apply what he learned at H&M to Forever 21, he has a good chance at a turnaround."
"I wish Daniel Kulle much luck. I’m sure he has tremendous talent, ability, and knowledge in the fashion industry, but his mission is not one that will be easy to accomplish."

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