For a long time Jay Baker didn’t like the trend he was noticing — too many young people out of college or graduate school ignoring retail and choosing careers in finance, real estate, technology or entertainment instead.
“They would think of the long hours, not enough pay. There was this whole story out there about retailing,” said Baker. “I saw some companies going outside the industry to hire people — they’ll be nameless — and they failed. It wasn’t at Kohl’s, but it was at some companies I knew.”
So not long after serving as president of Kohl’s Corp. from 1986 to 1999, Baker decided to change the narrative. Baker reached out to his alma mater, The Wharton School of the University of Pennsylvania, class of 1956, to discuss his vision for change. As a successful retail executive, alumni and a major benefactor to the school, Baker would get an audience. He and his wife Patty in 1999 gave $11 million to support construction of a new Wharton undergraduate center, the Jon M. Huntsman Hall, which includes The Baker Forum, a two-story hub for student study and activities. The gift also endowed The Baker Leadership Scholars Program, providing financial support to Penn undergraduates.
A meeting was held where Baker underscored a serious oversight at Penn, that an institute of higher learning with a large marketing department offered just one course in retailing. “We had the dean, the associate dean, about 20 people in a room — wonderful people,” Baker recalled. “I said I have a vision of how we could get young students interested in retailing. It was a great meeting, but I saw their interests were different from mine, so I said, ‘Maybe I will go to Columbia University with this.’ I figured it would be a good thing to say.”
The tactic worked. Shortly thereafter, Judith Rodin, president of Wharton at the time, agreed to work with Baker to turn his vision into reality, and in 2002, Wharton announced the creation of the Jay H. Baker Retailing Initiative, funded by a $10 million gift from Baker and his wife Patty to expand the university’s curriculum and research activities in retailing and promote faculty and student interaction with industry experts from around the world.
Rodin characterized the Bakers’ gift as “extremely important for the Wharton School and for the University of Pennsylvania by providing a terrific framework for our students and for our faculty to engage the retailing industry.” She cited the Bakers long-standing support of the university and its Wharton School, adding, “We share their commitment to providing our students with an outstanding and broad array of learning opportunities.”
In 2010, the Bakers made another gift — $15 million — to permanently endow the Jay H. Baker Retailing Center.
The center has been instrumental is establishing retail courses throughout the university which are available through many academic departments for both undergraduate and graduate students. The courses emphasize retail strategy, merchandising, operations, supply chain, consumer behavior, pricing, and e-commerce. The center was also instrumental in developing a secondary concentration in retail for undergraduates at the University of Pennsylvania.
The center facilitates research; engages industry leaders in interactive programs, teaching classes or guest lecturing, advising students, sponsoring student and alumni events, providing career advisory services, and helping students land internships and full-time jobs at retail companies. Within tje center there are two retailing clubs, one for undergrads; one for MBAs. The faculty has been involved in research in such areas as supply chain, sales associates, customer experience, livestreaming, sustainability, human resources and what it takes to retain employees. Research is funded by the center which also supports Ph.D. fellowships to encourage future business faculty to study retailing.
“My vision was to get young people and the industry involved,” said Baker. “Fortunately for me, I was able to set up a terrific board of people from both wholesale and retail. I had just retired so I knew a lot of people. They would come to meetings at the center and talk about their problems in business and how we could help them, and secondly to interview students and give them jobs. We brought students into the meetings with all these high-priced, very talented retail and wholesale people and they started coming to job fairs and we started getting kids interested. I would speak at classes until I realized I was a little passe maybe. I wanted new people.”
Among them was Terry J. Lundgren, the former chairman and chief executive officer of Macy’s Inc. who helped establish the Terry J. Lundgren Center for Retailing at his alma mater, the University of Arizona.
For Baker’s retailing center, “Jay recruited me to join his advisory board. He’s got an infectious personality. People want to be supportive. He stays connected and informed,” said Lundgren. “Jay and I had the same point of view when it comes to the students and younger people. What we really wanted is for them to know about career opportunities in retail and attract the best and brightest. Not enough of these students knew about those opportunities and the goal was to expose them to it. I don’t think most individuals in their twenties realize the breadth of opportunities that exist in retailing, in logistics, technology, data science, transportation, all the various merchandise categories. You do work hard. This is a very challenging business. There are things that you love and hate about it. You could rise to the occasion, take market share and charge people up about the prospect. However, if you are highly leveraged, you are constantly digging out. You can’t play offense and you end up reducing expenses. But once people get a taste of getting through difficult times and winning, it’s very stimulating. I was president of Bullock’s when I was 35, CEO of Neiman Marcus when I was 37. I felt I was getting promoted faster than I wanted. But I loved every job I had along the way.”
Paul Charron, former chairman and CEO of Liz Claiborne and currently an operating partner with Traub Capital, got involved with Baker center at its outset 20 years ago, as an adviser and occasional lecturer, and board member. “Given that retailing is creative, entrepreneurial and fun, I think the industry can do a much better job of promoting itself as a career choice for America’s best and brightest. Baker at Wharton attempts to do this. What makes this program unique is the commitment to retailing through curriculum, faculty, research and promotion of the industry at one of America’s greatest learning institutions, the Wharton School.”
The Jay H. Baker Retailing Center hosts an annual daylong CEO summit bringing together 150 senior retail and leaders and honoring a prominent industry figure at dinner the night before with a “Retail Excellence Award.” This year’s honoree was designer Tory Burch.
The center supports learning initiatives for students outside of the classroom including an annual “Ideathon.” Approximately 130 undergraduate and graduate students form teams to ideate and come up with solutions for real work challenges as presented by a sponsoring company. The first ideathon was in January 2020. It was sponsored by Ralph Lauren and centered around personalization and the mobile experience. This year, the sponsor was MCM Worldwide and the challenge was how to get younger consumers engaged as consumers of luxury. The students spent 24 hours at a hotel and presented their work to a panel of judges comprised of faculty members and senior MCM executives.
“They get significant prize money but it’s a really nice way to see students, outside of a 30-minute interview, and understand what they are about,” said Mina Fader, managing director of Wharton’s Baker Retailing Center. “The interesting thing is we bring C-level executives who come to mentor through the evening, so it’s not just MCM people that are here. It’s really a big community builder. Students love it.
“What has really happened at the center since Jay and Patty were so generous is that students who were always interested in finance, consulting, general marketing and things like that, now understand that retail is a very viable career after having taking classes, meeting with senior executives and getting exposure to what retail is about. Even if they don’t go into retail when they first graduate, some end up in retail. It is the only retail center that exists within an Ivy League school.
“What’s also unique is that the people in our boards are not just university and Wharton alums. We actually have industry leaders that may not have any affiliation or association with the university except to be part of the Baker board,” said Fader. “So it’s this idea of really getting top people from the industry involved with top people from the academic world.”
The center has three boards; an advisory board composed of established omnichannel retailers; a directors’ council with mostly digitally native retailers, and a West Coast board with established omnichannel and digitally native companies. They generally meet twice a year.
Baker said Amy Gutmann, president of the University of Pennsylvania for 18 years until February 2022, wanted Wharton to be more integrated with other parts of the school. “We were able to do that,” said Baker. “We have students from other areas that don’t go to Wharton that got involved with us. We have accomplished a hell of lot in 20 years. There was no tunnel vision. Where do you get the chance to have great industry leaders and a school like Wharton with great professors that together can think out problems and do something. That’s very rare, and hard to get that together. Mina has worked hard on it. I’ve worked hard on it.
“We are the number-one retail center in the country, partly because of the number of students involved and the number of students that get placed through it. No one comes close to what we are doing,” Baker said. “This thing has grown.”
Yearly, about 250 undergrad and graduate students at the University of Pennsylvania who are involved with the center, attending talks and classes or participating in the retail club, either intern or pursue a full-time career in the retail industry. They attend various schools at the university, with many coming from the Wharton business school, and the School of Arts and Sciences. Typically, they’re business degree candidates majoring in marketing or economics.
Asked if retailers do a good job of marketing themselves to attract talent, Baker replied, “For many years, 100 percent they didn’t do a good job. There wouldn’t be a Baker Retail Center if I thought they were terrific. Twenty years ago, people felt you were going into a slave business. That you are going to work 100 hours a week and make 10 bucks. Retailing did a lousy job correcting impressions. Retailing is the biggest industry out there, by far. What we have tried to do is show how big retailing is, and what the opportunities are in terms of technology, stores, products, logistics. It’s changed a lot. In a small way, we got the word out that it’s not so bad in retailing.”
After completing his undergraduate degree in management and marketing from Wharton, Baker worked his way up the retail ranks. He held entry level, buying and management positions at Macy’s and the former Ohrbach’s. Baker rose to senior vice president of softlines at the former Batus Retail Group; CEO of the former Thimbles chain; a general merchandise manager of ready-to-wear and director of stores at Saks Fifth Avenue, and CEO of the Batus buying office.
In 1986, Baker along with Kohl’s CEO Bill Kellogg, chief operating officer John Herma, and some outside partners led a management buyout of Kohl’s from Batus. Baker, as president, was the lead merchant and during his tenure, the company grew from 40 to 350 stores, with revenue growing from $280 million to over $6 billion.
“After we paid off our debt in two years, we wanted to expand Kohl’s. We brought Morgan Stanley in and bought out all our (outside) partners, and it was basically the three of us and the team and Morgan Stanley. Bill, John and I were together for 14 years. We never had a down quarter in profit or sales. We were growing very rapidly. So I am use to winning. We won and we did extremely well. We worked 80 hours a week. We were able to get great people to work for us during a short time. It’s a freaky thing, Marshall Field’s went out of business. Gimbel’s went out of business, so did other companies. Consolidation was a very good thing for Kohl’s, and not so good for so many other people. Here we were in Wisconsin. No one ever heard of us. People needed jobs. We got this tremendous group of people to work together. We were lucky in that.”
Baker retired in 2000 and stayed on the Kohl’s board till 2007. “I did leave Kohl’s at a very good time. Other than Walmart and some of the other giants, we were one of the hottest retailers in the ’90s.
“It’s a much tougher business today. Amazon was selling (just) books when I was at Kohl’s. They were not a threat at the time. I was smart enough to retire before Amazon decided that books was not the only thing. Amazon has changed our whole business. It’s amazing what they did. But it’s also created tremendous opportunities for these kids. You are still getting plenty of kids going to Macy’s and Kohl’s and others. But there is a wider range. Walmart is there. Target is there. Kids have a bigger range they can look at and I think that’s fine.”
Baker said he once had lunch with Michelle Gass, the current CEO of Kohl’s, and has talked to her a few times. “It’s a very tough job she has today. She’s charming, very bright, dynamic but she comes from a different world. She now has nine years experience,” at Kohl’s since joining as chief customer officer, expanding her role to chief merchandising officer, and becoming CEO in 2018. “We had a hundred years of experience, so it probably was a little easier for us from that standpoint. I spent my life in retailing and so did John and most of the people we hired.”
Kohl’s was originally a corner grocery store in Milwaukee founded by Max Kohl in 1927. It became a successful chain in the local area, and in 1962 branched out by opening its first department store. Kohl’s could be considered a pioneer in linking a department store with a grocery, a template that Walmart and Target eventually adopted. The British American Tobacco company took a controlling interest in Kohl’s in 1972 when it was still managed by the Kohl family, and in 1979, the corporation was sold to Batus, the U.S. subsidiary of the British company, which at its peak operated Saks Fifth Avenue, Marshall Field’s, Thimbles and Ivey’s. Batus grew Kohl’s from six to 39 stores, and eventually divested Kohl’s and its other holdings.
Retailing, said Baker, “has never been an easy business. There are no geniuses in retail, maybe Sam Walton and Jeff Bezos. One thing you have to do is really outwork other people. There are a lot of very bright people but no geniuses.
“What’s missing are the merchant princes. They are not being developed,” said Baker. “I was pretty good at it. There was a whole bunch of us that were really good. The merchandise has changed but the concept hasn’t changed. You still need to buy merchandise, certain merchandise, at the right price at the right time.”
Baker, now 88, grew up in the Flushing section of Queens, New York where his mother ran a small millinery shop and where he worked while in high school. His father sold millinery products in the garment district in Manhattan. Eventually, Baker took an entry-level job at Macy’s.
The Bakers have a penthouse apartment in Naples, Florida, which was ravaged by the deadly Hurricane Ian, along with Fort Myers, Sanibel Island and other areas of the state. “We were lucky but Naples was hit hard,” said Baker. “It’s going to take awhile to recover. Naples is a very resourceful place. We love it here. Hopefully everyone will band together but it depends on leadership.”
Naples is where Baker has what he says is the best Yankee baseball collection that exists. “My wife bought me two Babe Ruth and Lou Gehrig balls and that’s how it started 25 years ago. I collect Ruth, Gehrig, DiMaggio, Mantle and Jeter. I have a World Series watch from every series they won. I have all kinds of stuff — Mickey Mantle’s first uniform, his first home run ball, and uniform when he set the most home runs in a series, which is 18. I have a bat that belongs to Derek Jeter.” Jeter did once visit Baker and walked through the collection.
Though the Yankees lost to the Houston Astros in the American League Championship Series and won’t be in the World Series, Baker believes there’s hope for next year. “Aaron Judge, he’s not only the best player, he’s the heart and soul of the whole team. If they pay enough, they will keep him. It would be a disaster for the Yankees to lose him.”
In Naples, the Bakers have been longtime supporters of cultural and health institutions, including the Baker Museum which focuses on contemporary and modern art and the NCH Baker Downtown Hospital. They have also donated generously to New York’s Fashion Institute of Technology, which awarded Jay Baker an honorary doctorate, and Hunter College in New York (his wife’s alma mater) to aid its theater department. In 2014, the Bakers committed $10 million to establish The Patty and Jay Baker National Palliative Care Center at the Icahn School of Medicine at Mount Sinai.
“We are involved in many things from a charitable point of view, and considering I’m retired, I am an incredibly busy guy,” Baker said.