Inside This Issue - Opinion
An ancient motivation at work
November 14th, 2011
by David Pinto, Editor
Retailing executives do not often change companies, even if they get a promotion in the bargain.
That’s why what happened less than a month ago is so stunning: Two of retailing’s most senior — and very best — managers left companies at which they had been deemed irreplaceable for new opportunities and challenges — and possibly hazards — elsewhere.
First, Mike Bloom, CVS’ senior merchant, one of the retailer’s key executives, left to become president of Family Dollar, the Matthews, N.C.-based, 7,000-plus-store dollar chain.
Immediately thereafter, Michael Francis, the marketing icon behind the emergence of the Target brand as arguably the most successful in retailing history, resigned that position to accept a job as president of J.C. Penney.
Behind each move, though mingled with and partly obscured by other motives, was that ancient motivation: the chance to manage or help manage a company, rather than just a key unit within that company. Bloom will work with Family Dollar CEO Howard Levine to raise the level of excitement and innovation at a company that has until now relied almost entirely on price to attract customers. Francis will, with incoming Penney CEO Ron Johnson, strive to bring some of Target’s marketing magic to a retailer whose primary coloring until now has been bland and whose customer appeal has been difficult to define, much less build on.
It’s not difficult to understand why each of these two executives changed jobs — and companies. In rising to the top of CVS’ merchandising tree, Bloom realistically believed he could go no further at a $100 billion company that had recently turned to Macy’s to recruit a president for its drug store unit. Francis, though universally acknowledged for the brilliant marketing initiatives that lie at the heart of Target’s astonishing success, nonetheless realized that he would never replace the retailer’s excellent CEO, Gregg Steinhafel. In that sense, each rightfully assessed the possibilities of expanded opportunities at a new company.
Still, challenges remain for both of them. Bloom, a classic drug store merchant whose merchandising success turned on creating interest and excitement in CVS’ core front-end categories, must learn an entirely new go-to-market strategy, then set out to enhance it with some of the creative merchandising ideas that worked so well at CVS. Additionally, he must coordinate and adapt his approach to management to a Family Dollar staff that has succeeded in its own right. Retailing history has shown that this is no small assignment.
For Francis, the task at hand is even more difficult. To quote the Penney press release announcing his arrival, Francis “will be responsible for all merchandising, marketing, planning and allocation, and product development and sourcing functions at a time when the company is focusing on redefining the department store.” In his spare time he will also be asked to coach the Penney Little League team (just kidding).
Michael Francis has many talents. But the one that distinguished him at Target was his uncanny ability to bring marketing excitement to the organization by reaching outside the company to attract iconic names and personalities to the Target banner, then build compelling product assortments around these names. If you need proof as to how successful Francis has been in this undertaking, look no further than the recent introduction of the Missoni brand at Target, which virtually overnight became one of the most stunning branding successes that retailer, or indeed any retailer, has ever enjoyed.
At Penney, however, Francis faces a challenge that transcends the task of transforming and enhancing a company’s image. Simply put, Penney has no image to speak of — or at the least none to which consumers can relate. In a sense that will work to Francis’ advantage: He will confront, initially, a blank canvas. In welcoming Francis to the company, senior Penney executives spoke about the Penney “brand,” ignoring the fact that the Penney brand largely exists only in their minds, while the Target brand, by contrast, is a very real part of the consumer shopping experience in America.
Still, if anyone in America can create a brand, that person is Michael Francis. His stature at Target had become legendary. He knew and was respected by everyone of significance in the beauty, fashion, entertainment, business and political worlds. Michelle Obama sent him a text message expressing the excitement she and her friends found in Target’s Missoni collection. Entertainment icons on both coasts treated him as an equal and warmly welcomed him to every significant industry function. He was a very real presence in the fashion community. His name had become synonymous with retail marketing. He transformed the Target bulls-eye from a logo into an icon that signified value.
The question is, can he do it again? More to the point, can he do it at J.C. Penney?