Apple Appoints New Retail/On-Line Chief

October 15, 2013

After enduring 11 months without a guiding executive, Apple’s retail stores will share a senior vice-president with the company’s on-line retail operation when Angela Ahrendts joins the company by mid-2014 from her position as CEO of fashion house Burberry (UK). In the newly-created position, Apple said Ahrendts, 53, will have oversight of the strategic direction, expansion and operation of both Apple retail and online stores. Her appointment comes as Apple retail continues to emphasize international store expansion and to experience larger crowds at its Genius Bars. There is also on-going and unresolved discontent among a large segment of retail store employees over low pay and stressful working conditions caused by an increasing number of customers. Ahrendts’ success at Burberry has been remarkable—revenues have nearly tripled during her seven-year stint, and Burberry is now the UK’s largest apparel firm by market capitalization. Her success also brought her a major honor: the UK’s highest-paid executive, at $27 million a year.

Unlike the first two Sr. VPs of retail who had MBA degrees, Ahrendts earned a Bachelor of Arts degree in Merchandising and Marketing from Ball State University (Ind.). Her previous experience is with “soft goods” companies, and doesn’t include any experience at technology firms.

In a statement, Ahrendts said, “I am profoundly honored to join Apple in this newly created position next year, and very much look forward to working with the global teams to further enrich the consumer experience on and offline.” She added that she hopes, “in some small way I can help contribute to the company’s continued success and leadership in changing the world.”

Angela AhrendtsIn a press release, Apple CEO Tim Cook said, “She shares our values and our focus on innovation, and she places the same strong emphasis as we do on the customer experience. She has shown herself to be an extraordinary leader throughout her career and has a proven track record.”

Ahrendts’s appointment comes 11 months and 16 days after the retail segment’s previous Sr. VP, John Browett, was fired in October 2012 over differences in how the retail segment should be operated. Browett had officially spent just six months in the position, having replaced Ron Johnson, who joined the company in 2000, helped mold the company’s original retail concept and guide it to remarkable financial and operational success.

Perhaps not coincidentally, Apple loaned Burberry several pre-release iPhone 5s smartphones to photograph a major fashion show last month. The photos were Tweeted as part of Burberry’s on-going focus on social media sharing to promote the company. Also, Burberry has a flagship store on Regent Street in London, about five blocks south of Apple’s Regent Street store.

Ron Johnson was making about $700,000 a year when he left the company, much less than Ahrendts’ current pay at Burberry. However, Johnson—like other Apple execs—received substantial stock grants that boosted his overall compensation.

Apple’s full press release stated:

Angela Ahrendts to Join Apple as Senior Vice President of Retail and Online Stores

CUPERTINO, California—October 14, 2013—Apple® today announced that Angela Ahrendts, CEO of Burberry, will be joining Apple in a newly created position, as a senior vice president and member of our executive team, reporting to CEO Tim Cook.Ahrendts will have oversight of the strategic direction, expansion and operation of both Apple retail and online stores, which have redefined the shopping experience for hundreds of millions of customers around the world. Apple retail stores set the standard for customer service with innovative features like the Genius Bar®, Personal Setup and One to One personal training to help customers get the most out of their Apple products.“I am thrilled that Angela will be joining our team,” said Cook. “She shares our values and our focus on innovation, and she places the same strong emphasis as we do on the customer experience. She has shown herself to be an extraordinary leader throughout her career and has a proven track record.”“I am profoundly honored to join Apple in this newly created position next year, and very much look forward to working with the global teams to further enrich the consumer experience on and offline,” said Ahrendts. “I have always admired the innovation and impact Apple products and services have on people’s lives and hope in some small way I can help contribute to the company’s continued success and leadership in changing the world.”

Ahrendts will join Apple in the spring from Burberry, where she serves as CEO and has led the company through a period of outstanding global growth. Prior to Burberry, she was executive vice president at Liz Claiborne Inc., and earlier in her career she served as president of Donna Karan International.

Later, CEO Tim Cook sent an all-employees this email explaining Ahrendts’ hiring.

Team,I am thrilled to announce that Angela Ahrendts will be joining Apple as a senior vice president and member of our executive team, reporting directly to me. Angela is currently the CEO of Burberry.She will lead both our retail and online teams. I have wanted one person to lead both of these teams for some time because I believe it will better serve our customers, but I had never met anyone whom I felt confident could lead both until I met Angela. We met for the first time last January, and I knew in that meeting that I wanted her to join Apple. We’ve gotten to know each other over the past several months and I’ve left each conversation even more impressed.

She shares our values and our focus on innovation. She places the same strong emphasis as we do on the customer experience. She cares deeply about people and embraces our view that our most important resource and our soul is our people. She believes in enriching the lives of others and she is wicked smart. Angela has shown herself to be an extraordinary leader throughout her career and has a proven track record. She led Burberry through a period of phenomenal growth with a focus on brand, culture, core values and the power of positive energy.

Angela will need to focus over the coming months on transitioning her current role at Burberry and will then join Apple in the spring. I am sure as all of you meet her, you will see why I am so excited that she is joining our executive team. I’d like to add a special thanks to all of our retail leaders. Your strength, talent and leadership afforded me the luxury of taking the time to perform an exhaustive search to find the best person in the world for this role.

Tim

Burberry issued a press release that said in part:

Board Change

15.10.2013

Angela Ahrendts transitions from Burberry

Burberry today announces that Angela Ahrendts will step down as Chief Executive Officer by mid-2014 to take up a new position with Apple.

Angela Ahrendts said:

“Burberry is in brilliant shape, having built the industry’s most powerful management team, converted the business to a dynamic digital global retailer, created a world class supply chain, state of the art technology infrastructure, sensational brand momentum and one of the most closely connected creative cultures in the world today. It has been an honour to have partnered with Sir John Peace and Christopher for the last eight years.

The video below was released by Burberry announcing Ahrendts’ departure and the appointment of a new CEO.

In the video below Ahrendts talks about global branding.

Ahrendts appeared at the TED conference last April, warning the audience she was better at operating a company than giving a presentation.

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