Target Corporation (NYSE:TGT) has more than 1900 stores in the US and Canada and generated close to $73 billion revenue in 2013. Target Corp had a difficult 2014 with a massive data breach derailed their sales and reduced the store traffic significantly. Target Corp decided to hire PepsiCo, Inc. (NYSE:PEP) executive, Brian Cornell as their new CEO in order to fix all the problems and revive the company.
Bloomberg’s Julie Hyman reported on Bloomberg TV on the Target Corporation (NYSE:TGT)’s move to hire Brian Cornell as their new CEO.
There were a lot of speculations on who will succeed Gregg Steinhafel as the new CEO of Target Corporation (NYSE:TGT). The majority of people thought that they would hire a CEO from a similar retailer company, but there were also some rumors that they might go out of the box.
Hyman said that Target has gone out of the box by hiring a CEO outside their organization for the first time. She thinks that a lot of retailers hang on to the idea of promoting CEO from within their organization, so she feels that this move by Target was unusual.
She added that Brian Cornell was the head of American Foods business for the past two years. She thinks that Cornell has vast experience in retail industry before his stay at PepsiCo. Brian Cornell spent three years at Wal-Mart Stores, Inc. (NYSE:WMT). He headed the Sam’s club Warehouse Chain for some time and he was CEO of an art and craft’s chain, Michael’s Stores, for two years.
She pointed out at her interaction with David Strasser from Janney Capital Market, who tracks Target and Wal-Mart. Strasser feels that Sam’s Club had significant improvement under Cornell’s leadership. Cornell increased the sales of Sam’s Club from low-single digit to mid-single digit in three years.
“[…] The challenges ahead of Target are pretty deep ones. The company most notably had that big data breach late last year. Although, an analyst I spoke to recently, called it a blessing in some ways, because it allowed the company to change its focus, not just in terms of data security, but more importantly in terms of its core strategy,” Hyman added.
She said that the challenges ahead of Cornell are pretty big ones and everyone is eagerly watching and waiting for his strategy to get the company out of this hole.