Macy’s on Monday announced the appointment of former eBay North America senior vice president Hal Lawton as president, effective Sept. 8, along with a restructuring of merchandising teams that will result in 100 job cuts, according to a company press release.
As SVP of eBay North America, Lawton was responsible for all aspects of the business unit and oversaw a period of sustained, sequential performance improvement, Macy’s said in a press release. Previously, he spent 10 years in various leadership roles at Home Depot, where he was most recently SVP for merchandising and Macy's said he was responsible for jump-starting homedepot.com and building it into a nearly $2 billion business.
The merchandising restructure will include the consolidation of three functions — merchandising, planning and private brands — into a single merchandising team to be led by 35-year Macy’s veteran Jeff Kantor, who will report to Lawton. Kantor has extensive experience in merchandising and stores, has overseen Macys.com and is currently chief stores and human resources officer, the company said.
In March, Macy’s new CEO Jeff Gennette outlined some of his vision for merchandising changes at Macy’s, promising a more nimble off-price/full-price hybrid retailer with more inspiring merchandise. The announcement Monday marks a few concrete moves when it comes to his team.
In a note emailed to Retail Dive, Gordon Haskett analyst Chuck Grom said he was impressed with Lawton’s record at both eBay and Home Depot, and that he viewed the choice as “one of the most interesting outside additions to the entire department store space (let alone Macy’s) over the past decade.”
While Macy's has yet to pursue Walmart's strategy of late to acquire digital native brands, Grom said he believes Lawton will bring a fresh perspective to the department store retailer — something long overdue, he said. “All told, while the move won’t impact sales or profitability overnight, we think the addition could mark the beginning of a new chapter for Macy’s.”
That doesn’t mean that tapping a 35-year company veteran in Kantor to work with Lawton is a downside, however. Macy’s is known for its deep retail bench, according to Howard Davidowitz, chairman of New York City-based retail consulting and investment banking firm Davidowitz & Associates.
“Macy's makes careful choices in their talent, and there’s a lot of talent there,” he recently told Retail Dive. “They grow good people — these are all important things that you don’t see on the balance sheet.”
Indeed, the balance sheet is fairly dire. Macy's is in the midst of a brick-and-mortar course correction, which entails closing at least 100 stores this year. That's helping erode sales: in its most recent quarter, the retailer said total sales fell 5.4% to $5.55 billion and same-store sales fell 2.8%. Executives reaffirmed guidance for the fiscal year, with expectations that same-store sales could decline by between 2.2% and 3.3% and total sales could drop by as much as 4.3%, though management still expects Macy’s to be profitable, with projections of earnings between $3.37 to $3.62 per share.