The CEO Fashion Needs Right Now

Mytheresa CEO Michael Kliger wants to make one thing clear: he’s not fighting for the title of “ideal CEO”.

It’s not that he doubts he’s good at his job: under his leadership, the German luxury e-tailer has seen impressive growth, ending the last quarter with double-digit revenue gains of year on year, although some of its competitors have struggled.

But Kliger doesn’t believe the perfect leader exists. Much like the lingering uncertainty that has defined retail since the pandemic, the skills most relevant to fashion’s C-suite today are constantly evolving, he said.

“There are great people at the right time and a lot of great people at the wrong time,” Kliger said.

As for this moment: the pandemic is almost in the rearview mirror and a recession is potentially on the horizon. Where, when and how most people work have fundamentally changed across many industries and, in fashion, rapidly evolving conversations about sustainability, diversity, supply chain and digital transformation are having an unexpected impact on business results. Meanwhile, the impending economic downturn could serve as a litmus test to reveal the strengths and weaknesses of many senior executives and the companies they lead.

There may not be a single leader for every fashion company, but boards are weighing the question: who is best equipped to lead our business right now? Often it is not the current CEO. Last year The Gap, MatchesFashion, Lyst and others lost their top executives, and already this year Victoria’s Secret and Stitch Fix announced CEO departures. A number of fashion companies – including The Gap, Kohl’s, The RealReal and VF Corp. – began 2023 without a permanent leader.

The turmoil at the top is a great opportunity to reshape the profile of the fashion CEO and broaden the skills and experience of industry leaders beyond more traditional avenues. So far, many industry CEOs have spent most of their careers in retail sectors such as fashion and beauty – and the merchandising, operations, finance and marketing lanes. marketing remain popular routes to the C suite.

“There was a time when if you had good merchandising, a good brand, and a decent experience in-store or online, you would be fine,” said Garrett Sheridan, CEO of Lotis Blue Consulting. “But we are dealing with more complexity now. The role of the CEO… fundamentally changes.

New retail, new playbook

More than ever, fashion leaders need to be agile and flexible, possess strong change management skills, an ability to create compelling stories for their customers and employees, and respond quickly and innovatively in a highly digital world. .

Some fashion companies are moving away from the “merchant king and queen” leadership profile and selecting their leaders from consumer packaged goods companies, hospitality and technology industries, and previously back-office functions. office like human resources and supply chain, Kyle said. Rudy, senior partner at Kirk Palmer Associates.

Last month, sportswear brand Under Armor named Stephanie Linnartz, president of hotel chain Marriott International, to its executive role. Around this time last year, Chanel brought in Leena Nair, then head of human resources at Unilever.

Even as CEOs “grow up” in the industry — Calvin Klein, Sephora and Foot Locker have all recently brought in their new fashion or beauty heads — the paths many executives take to reach the top are becoming less traditional. Their resumes are built around abilities and experiences that weren’t considered essential in years past, Rudy said.

“Nowadays you’ll see more and more CEOs focusing more on international experiences somewhere in their journey,” Rudy said, quoting Eva Serrano, president of global brand Calvin Klein, formerly president of operations for Inditex. for Greater China, as a recent example.

There is still room for leaders with more linear merchant journeys to succeed in retail, but they will need to be visionary and flexible, as well as building strong teams in areas such as design, diversity, sustainability and technological innovation, according to experts.

At J.Crew, CEO Libby Wadle — whose resume includes executive merchandising roles at Coach and The Gap — credits her “merchant roots” with helping her meet the ever-changing demands of consumers and consumers. brand employees over the past two years – including orchestrating the historic US label’s turnaround efforts, which have recently begun to bear fruit.

Wadle’s strategy — which included a revamped menswear design team under Supreme alum Brendon Babenzien — was widely seen as one rooted in the workings of traditional retail.

“A fundamental and essential part of being a good trader is listening to your customers’ signals,” she said. “I think it’s the same [true] for a [company’s] culture and people. I am a listener first. I don’t like being the smartest person at the table, or on Zoom for that matter.

A recession opportunity?

If the predicted economic downturn materializes in 2023, CEOs will have to make tough decisions about layoffs, store closures, and more.

Overall, however, the most successful leaders will resist the urge to focus all their attention and planning on temporary economic fluctuations and, instead, maintain a long-term perspective and, if possible, continue to invest in areas such as talent development and corporate culture. said Maju Kuruvilla, CEO of Bolt, a fintech company that works with fashion brands such as Revolve, Forever 21 and Badgley Mischka.

“History has taught us that whenever there are downturns like this, that’s when the best companies are created,” he said. “But you need to invest in your people, get very close to your customers…and remove any latency from your processes.”

Mytheresa’s Kliger said he expects 2023 to require “constant reallocation of resources”, which means he’ll have to be ready to shift priorities on a dime. But, for now, he plans to focus on “regional growth opportunities” in the US and China; “operational excellence”, which includes hiring and developing talent; and go further in the clientele.

While companies shouldn’t hire leaders solely on their ability to execute layoffs and cutbacks, given that more than a decade has passed since the last major recession, it can be helpful to have a memory of what it is, according to experts.

“This is a time when experience helps…there is a generation of young business leaders who have no experience of what a recession is or is not. Age is not always an advantage. But sometimes it does,” Kliger said.

J.Crew’s Wadle is also counting on her 18 years of experience – she served as president of the J.Crew brand during the 2009 recession – to help lead the company through what she considers “another moment of uncertainty”.

The goal, she said, is to continue to focus on the product and “lead creatively” while responding quickly to consumer changes.

“I had a few of those moments,” she said. “We really have to stay focused on what we’re building. It’s very easy to get distracted by one title a day.