Millard “Mickey” Drexler is stepping down as chief executive officer of retailer J. Crew, ending 14 years at the top of the company.
David Moin of Women’s Wear Daily had the news:
Drexler’s departure as ceo comes two months after company president and creative director Jenna Lyons exited the company.
“I am relaxed-ish,” Drexler told WWD in an exclusive interview on Monday. “It’s a large day for me. I have been running companies for 37 years and the announcement today is a major change in my life… I am excited about where the team is and the strategic plans we have. There’s excitement about J. Crew and Madewell — brands that people love and admire.”
Drexler, who invested $100 million in the company, owns 10 percent and has a strong relationship with the board, said he was decision to step down. “I have been running companies for 37 years,” he said, noting that he’s 72. He turns 73 in August.
“I am a young-old guy. I have ‘shpilkes.’ I am always in a state of impatience. I have been here for 14 years. I thought it was time to move on and lessen up on the day to day,” he said. “The [succession] plan had been in motion for some time. I told the board a year ago I was ready to set down and move to chairman. We worked together looking for the right talent to lead the next phase of growth…When we found Jim we knew had to move quickly.”
Christina Cheddar Berk of CNBC.com reported that Drexler’s replacement comes from Williams-Sonoma:
Drexler, who is 72 years old, will remain chairman of the company’s board, and will be replaced by James Brett in July.
Brett, a 25-year retail veteran, most recently served as president of Williams-Sonoma’s specialty home-furnishing company West Elm. Prior to that role, he worked at Urban Outfitters, Anthropologie and J.C. Penney.
Drexler was famed for his turnaround of Gap in the 1990s. When he arrived at J.Crew in 2003, he worked hard to do the same by introducing the idea of providing designer quality clothing for the masses. The strategy succeeded for a while.
But recently, the retailer has been in a prolonged sales slump, as shoppers balked at paying up for the brand’s preppy style as its prices spiraled higher. Same-store sales have been down for the past 10 quarters.
Meanwhile, the company became burdened by heavy debt load of about $2 billion, which ballooned in the wake of a leveraged buyout in 2011 by TPG Capital and Leonard Green & Partners.
Hayley Peterson of Business Insider reported on what went wrong at the retailer:
“We gave a perception of being a higher-priced company than we were — in our catalog, online, and in our general presentation,” Drexler told The Journal. “Very big mistake.”
At the height of the Great Recession in 2008, J.Crew unveiled a higher-priced line, called J.Crew Collection.
The line, spearheaded by Jenna Lyons, at the time the head designer, debuted with a store on Madison Avenue in New York City. It featured items such as a $3,000 jacket “with French sequins in various shades of tortoiseshell hand-sewn into silk chiffon,” the now defunct magazine Portfolio wrote at the time.
The higher prices alienated customers when they were strapped for cash and increasingly shopping at discount stores.
“We became a little too elitist in our attitude,” Drexler told The Journal.
