Retailing isn’t what it used to be and apparently neither is being a retail company CEO.
Turnover has been brisk the past couple of years as C-suite veterans grappled with previously unimaginable crises like the pandemic, struggled to adapt to new technologies, and confronted sea changes in consumer expectations.
Gone are the days when being a savvy merchant included mingling on the sales floor with customers, engaging with employees, and nurturing a clear brand vision like Starbucks’ Howard Schultz or Zappos’ Tony Hsieh.
Instead, “You have to be competent at data science, community relations, reputational issues, global politics, and all aspects of sustainability … all while you are actually running your business day to day," according to Ian Bailey, recently retired as managing director (equivalent to CEO) of Kmart Australia.
The current exodus began in 2023 while the consumer economy was still recovering from the global shutdown in 2020, surfing on a wave of stimulus funds and inflation that boosted sales numbers and produced a profit bubble. The number of leading retail CEO exits that year was 52, more than double the year before and the second highest recorded since 2002, according to Challenger, Gray & Christmas, a leading executive placement agency.
After a dip in turnover in 2024, the revolving door is spinning again.
Precise figures are hard to find as some sectors show up under categories other than retail and estimates may miss smaller chains and private companies. But a little more than halfway through last year, Challenger reported a 116% surge over the same period in 2024.
One of those departing CEOs is Walmart’s Doug McMillon, retiring at the end of this month after 12 years at the helm of the world’s largest retailer by revenue. Speaking early last year at a “Future of Commerce” event, McMillon observed that, “The change in front of us feels like it’s greater than the change behind us.”
That prospect is the source of high anxiety among retail leaders who, according to executive recruiting firm Russell Reynolds Associates, “remain unsure of the best way to approach implementing these new technologies—particularly AI.”
The firm says its surveys have found that only 40% “are confident that they have the right skills to implement AI,” and only 22% “believe they have the right expertise of the board” to advise them.
Meanwhile, directors and investors have become less patient with leaders of companies that have been struggling. Andy Challenger, chief revenue officer at Challenger, Gray & Christmas, recently told industry news site RetailDive.com, “We’re seeing companies recalibrate leadership faster than ever, with boards demanding adaptability and fresh perspective at the very top.”
Notable exits of late include CEOs of Lululemon, Starbucks, Target, Ulta Beauty, L.L. Bean, Solo Brands, and The Container Store, just to name a few.
Experts predict another year of higher-than-usual turnover as the technology revolution continues and the affordability crisis lingers.
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