Kay Krill, president and chief executive officer of Ann Inc., who started the fast-growing Loft division from scratch and guided the parent corporation through the Great Recession, is handing over the reins to her second-in-command, Gary Muto.
Muto has been president of Ann brands, working closely with Krill since he joined Ann Inc. seven years ago from Gap Inc. Ann Inc.’s brands include Loft, Ann Taylor and Lou & Grey.
The management shift is the first major change under the company’s new owner, the Ascena Retail Group Inc. Ascena closed on the $2.2 billion deal to acquire Ann Inc. in August.
Krill has been appointed to Ascena’s board. She’s also on the boards of the Breast Cancer Research Foundation, the National Retail Federation and St. Luke’s School in New Canaan, Conn.
“I felt like this was a natural time for this transition,” Krill told WWD. “October 2015 is my 10th anniversary as ceo. It’s a big time for me, and you know the business is in good shape. But I’m not leaving. I’m taking on a broader role and looking forward to remaining involved and adding value to the entire Ascena organization as a board member.”
Related Galleries
Krill, who is 59, also said she’s looking forward to spending more time with her twin 15-year-old sons.
With the new owner and the change in command at the $2.5 billion Ann Inc., dramatic changes are not necessarily expected. “I really do feel like Ascena has absolute respect for each of the brands and what they stand for,” Krill said, adding that David Jaffe, president and ceo of Ascena, “really lets the brands run independently.” She said that Muto, who becomes ceo and president, “would just continue to build upon what we have created here. He has worked closely with me on all aspects of growing the Ann Taylor and Loft brands, as well as the launch of Lou & Grey. He’s the right executive to build on our strong foundation. In my eyes, I have always seen him as my successor. We took succession planning very seriously. I will make sure that this transition is seamless and smooth. I am not going anywhere. I will be on the board and I will be involved in the entire organization. I would not leave this company if it was not in good financial shape.”
Ann Inc., with its range of upper-moderate to better-priced merchandise and updated, modern styling, will elevate the fashion image of Ascena, which is known for selling moderate prices, misses’ and large sizes to middle-income women, typically office workers. The divisions at Ascena, which include Lane Bryant, Dress Barn, Maurices, Catherines, Cacique and Justice, have been upgrading, in some cases through designer collaborations and new marketing.
Krill said the 21 years she worked at Ann were “the highlight of my retail career, especially growing the Loft brand from its inception.” She also launched Ann Inc.’s social responsibility program called Responsibly Ann, and Ann Cares, which contributes to programs that support women’s and children’s health and well-being.
As one of the few women running major retail corporations, Krill has made it a mission to invest in women’s causes and has been behind the Ann Power Vital Voices Initiative, a program geared to train and mentor future female leaders. “There are very few of us. It’s very concerning, but Gary has a strong team with a lot of female leaders,” Krill said.
Coincidentally on Wednesday, another female ceo of a major retailer stepped down. TJX Cos. named Ernie Herrman ceo, succeeding Carol Meyrowitz, who will become executive chairman and an adviser to Herrman.
Krill has been president and ceo of Ann Inc. since 2005. She joined Ann Taylor in 1994, advanced through the ranks, created the Loft brand and was named president in 2001. It’s currently a $1.5 billion business. In 2004, she was promoted to president of the corporation and named a director. From 2008 to its recent delisting due to the acquisition, Ann Inc.’s stock jumped from $3.82 to $45.
Muto, 56, joined Ann in 2008 as president of Loft, added oversight for Ann Taylor in 2014 and launched Lou & Grey in 2013. As president of Ann brands, Muto has been responsible for design, merchandising, marketing and stores for Ann Taylor, Loft and Lou & Grey. He added responsibility for e-commerce in 2014. Earlier in his career, Muto was president of several Gap Inc. brands, including Gap Adult, Banana Republic and the former Forth & Towne.
In a recap of how Ann’s brands are performing, Krill said at Loft, which she launched in 1998, the focus continues on “everyday fashion at surprising prices” and the performance is healthy.
Ann Taylor, where performance has been up and down over the years, is “constantly evolving to be more relevant to women’s wardrobing today and focused on workwear.” She added that “versatility has become really key to the success” with items and outfits that can be worn in multiple situations, day to night, and the brand has been “really ramping up the fashion component.” Asked if Ann Taylor was a challenging business, Krill assertively replied, “It is not a challenge. We are in good shape financially and operationally. It’s a matter of constantly evolving the Ann Taylor brand each year.”
Lou & Grey has eight stores and two additional openings set for this year. It recently launched a Web site. Asked if Lou & Grey could one day be a major rollout, Krill said, “We are hoping so.”
Lou & Grey opened its first freestanding store in April 2014 and sells a look described by Krill as “a fusion of streetwear and loungewear with a fashion component.”