Lands’ End’s stock fell 14 percent, or $2.54, Monday to $15.46 as uncertainty about the brand escalated following the announcement that its president and chief executive officer Federica Marchionni was leaving the company.
When Marchionni first joined Lands’ End in February 2015, the business was suffering sales declines and the climate for selling fashion had already turned very challenging. Marchionni was unable to reverse the trend and in the last quarter, the company went into the red.
From the very start of her tenure at Lands’ End — her first stint as a ceo — Marchionni felt the pressure to make changes. She made them rather quickly, working hard to raise the brand’s revenues, profile and appeal to wider, younger audiences compared to the core 34-to-54-year-old.
Early on, she launched the Lands’ Friendly campaign in conjunction with Earth Day, to promote the brand’s support for environmental causes and developed marketing with an aspirational lifestyle appeal. She relaunched the Canvas By Lands’ End subbrand to reach more stylish audiences and debuted Lands’ End Sport.
She also kept curtailing Lands’ End’s distribution through Sears stores, but attempted to raise the retail profile by opening holiday pop-up shops first on Fifth Avenue in Midtown Manhattan last year, and this year in the SoHo section of Manhattan. A pop-up in Southampton, N.Y., was opened during the summer season.
Oracle was signed up to enhance the company’s technology platform; catalog distribution was reduced and more targeted, and Marchionni hired Joseph Boitano, a former Saks Fifth Avenue merchant, as executive vice president, chief merchandising and design officer.
In addition, Marchionni was very visible in fashion and business circles, talking up Lands’ End at such conferences as Women in the World Summit 2015 held at Lincoln Center and the Michael Milken conference in Los Angeles.
“What I realized immediately is that we have no time to waste,” Marchionni told WWD in an interview not long after she was hired in February 2015. At that first board meeting on April 10, she recalled, “I felt a huge sense of urgency because competition today doesn’t allow you to take your time to make decisions, produce ideas and make things happen.”
But she was always dogged by skeptics suggesting her high-fashion image and background in luxury as a former Dolce & Gabbana executive didn’t fit well with the All-American Lands’ End. The perception was fueled by her decision not to relocate full-time to the Lands’ End headquarters campus in Dodgeville, Wisc., and instead work mostly out of the brand’s New York office. She defended her decision not to relocate by indicating that she and her seven-year-old son had already relocated a few times for her career, once to Maranello, Italy, where she served as a senior vice president at Ferrari, later to Milan for Dolce & Gabbana, and ultimately New York to serve as president of the brand’s North American operations.
She also defended her high-fashion experience, insisting she could adapt to a different price point and perspective.
With sales slipping and her strategies not bearing enough fruit — though they were only in place for a few seasons — Marchionni’s departure from the company was announced Monday. She could not be reached for comment.
The company named Boitano and James Gooch, executive vice president and chief operating and financial officer, as co-interim ceos. Heidrick & Struggles was hired to help find a permanent ceo, though “internal and external candidates” will be considered for the ceo role.
Chairman Josephine Linden thanked Marchionni “for her dedication and contributions to Lands’ End.”
“Her creative vision has helped Lands’ End begin its transformation as a global lifestyle brand with a broader merchandise offering that is more relevant in today’s marketplace,” Linden said, adding that the former ceo is “stepping down at this time, leaving Lands’ End well-positioned to continue its evolution and capture the growth opportunities that exist for our iconic brand in this dynamic retail environment.”
In a statement, Marchionni said she was “honored” to be at the company and “proud to have succeeded in providing a vision to expand its positioning in the industry with a multidimensional strategy.”
“However, the board of directors and I have agreed it is time for others to bring Lands’ End into the future,” she added.