J.C. Penney taps Levi's executive as CEO

Dive Brief:

Levi's executive Marc Rosen will be J.C. Penney's chief executive as of Nov. 1, the department store announced on Monday.
Simon Property Group's Chief Investment Officer Stanley Shashoua — who has been serving in the role in the interim since Jan. 1 — has been appointed executive chairman of the board, according to a company press release.
Rosen has more than 25 years of retail and e-commerce experience. At Levi's for more than seven years, he oversaw the direct-to-consumer business and digital strategy. Previously he was at Walmart for 14 years, in executive roles in e-commerce and information systems.

Dive Insight:

Rosen will be J.C. Penney's fifth chief executive in a decade, and will be taking on a turnaround project that's lasted at least that long.

The struggling department store was acquired out of bankruptcy last year by two of its landlords, Simon Property Group and Brookfield Asset Management, a maneuver widely seen as a bid to salvage J.C. Penney's important role as a mall anchor.

Marc Rosen spent over seven years at Levi's.

Courtesy of J.C. Penney

In a statement Monday, Shashoua touted Rosen's resume, leading with his digital chops: "Marc's significant e-commerce and retail experience makes him the perfect fit to lead the next chapter of the company's transformation as we work to better serve our customers."

That experience includes his previous effort at Levi's to grow its direct-to-consumer sales, something that has increasingly bedeviled department stores like J.C. Penney, which have watched many brands pull back from wholesale in favor of communicating and selling to customers themselves. Speaking to Vogue Business last year, Rosen characterized that as the future of retail, telling the magazine, "We've been on an intentional path to strengthen that direct relationship."

Now his task will be to strengthen the third-party relationship. That job may get easier as brands realize that the wholesale channel offers its own advantages. BMO Capital Markets analysts, for example, recently found that while direct-to-consumer sales can be higher, margins and profit often suffer quite a bit compared to wholesale.