Ralph Lauren steps down as CEO of Fashion Empire
September 28, 2015. Ralph Lauren, founder and designer of the eponymous fashion powerhouse, stepped down as the CEO of the company. Stefan Larsson, the current global president for Old Navy has been chosen as the chief executive. Ralph Lauren is has been a long standing name in the fashion industry, with its signature country club preppy attire. The RL name is so highly revered, some have resulted to measure the worth or value of an item in comparison to Ralph. Like your shirt might be nice and all. But it ain’t Ralph though (unless of course it is, then you’re Gucci. Get it?)
Ralph’s decision to hire outside the company raises some interesting questions about the company’s future. In the case that the founder of a company steps down as CEO, it is common practice to hire subsequent CEOs from within an organization, there seems to be a current trend towards the opposite, mainly due the experience of executives such as Stefan Larsson. The Swedish- born executive has had major success at his previous positions at H&M and Old Navy. During his 15 year span as Head of Global Sales at H&M, Larsson was part of the executive that helped the European cheap chic retailer expand to 33 countries, with Larsson being in charge of 2,300 stores which collectively bring in over 17 billion dollars in revenue.
Subsequent to H&M, Larsson became global president of GAP brand Old Navy. At a time when revenues were stagnant, Larsson was able to implement a more fashion-conscious approach to the design of future designs. He was also responsible for the expansion of Old Navy to Japan, as well the creation Old Navy’s new sports performance wear and yoga pants. Old Navy revenues showed a strong growth for the three short years Larsson took over as Global President. Current revenues are up 3% from last year and Old Navy is also the only GAP brand having a good fiscal year (revenue’s for GAP and Banana Republic have been down 7% and 8% in the last year, respectively.)
Larsson’s experience, as well his immense impact during his wildly successful career at H&M and Old Navy speak volumes to his intelligence, sensitivity to the current fashion trends, and the ability to create almost instant impact accordingly. Since the announcement of Larsson as the new of CEO of Ralph Lauren, RL stocks have gone up 14%, coming from a 5.3% (37% plummet in the past year) slump leading up to this announcement. Expectations are high, but it seems with Stefan Larsson’s resume, he may be the perfect candidate for the job.