After 22 years at the helm, A&F CEO Mike Jeffries is stepping down
Abercrombie & Fitch (NYSE: ANF) CEO, Mike Jeffries, announced today (12/9/14) that he will be stepping down from from the helm of the New Albany, Ohio based company, effective immediately.
Jeffries took control of the brand in 1992 and brought it from sleepy preppy clothier to international powerhouse with four subsidiaries (Abercrombie Kids (1998-) Hollister Co. (2000-) Ruehl No.925 (2004-2010) and Gilly Hicks (2008-2010)) bringing in almost 4.2billion in revenue in 2013.
The company was steadily growing in the early 2000's with teens loving the status that the neo-preppy brand provided, but in 2006, during an interview between Jeffries and Salon.com, the empire began to crumble:
"That's why we hire good-looking people in our stores. Because good-looking people attract other good-looking people, and we want to market to cool, good-looking people. We don't market to anyone other than that." ... "In every school there are the cool and popular kids, and then there are the not-so-cool kids. Candidly, we go after the cool kids. We go after the attractive all-American kid with a great attitude and a lot of friends. A lot of people don't belong [in our clothes], and they can't belong. Are we exclusionary? Absolutely." - Jeffries
Seven years later, this quote was resurfaced by Kirstie Alley and others - Jeffries claimed that the quote was taken out of context. This incident, combined with past allegations of discrimination, harassment, and bad product choices, left the board of the 80,000 employee company no choice but to strip Jeffries of his duties as board chairman in an effort to protect the shareholders, essentially leaving him as a CEO figurehead with little power.
The company is in the midst of a desperate turnaround effort as sales continue to fall coming out of the Great Recession. The brand announced earlier this year that that they will be eliminating its signature logo tees, redesigning stores as have pledged to close underperforming locations.
Whoever is pegged to replace Jeffries has a lot of work ahead of themselves, while I don't believe the company will get back to its early 2000's heyday, the company has an opportunity here to really start with a clean slate and reinvent the brand to better fit today's more frugal consumer. This is definitely a story that I will be keeping a close eye on.
Credits: Huffpost, Wikipedia | Additional Thoughts: modernprep