Target Corp.’s new chief executive is a polished businessman who spent the last decade job-hopping across the divide between retailers and their suppliers. Now he will have to settle in and study up on areas where Target needs work.
Brian Cornell spent time in top roles at Safeway Inc., Wal-Mart Stores Inc. and PepsiCo Inc., giving him a lot of knowledge of the food and consumer basics that make up a growing part of the discounter’s business. But he lacks deep experience with online sales and fashionable housewares, areas where Target has to show strong improvement to win back shoppers and reverse more than a year of falling traffic.
Target’s board excused those gaps in naming Mr. Cornell as the first outside CEO in the retailer’s history, instead favoring his diverse experience and reputation as a strong leader.
The chain store is granting Mr. Cornell nearly $19.3 million in equity grants to make up for what he is giving up by leaving his job as head of Americas Foods at PepsiCo, according to a regulatory filing. Target is also paying part of the $1.35 million bonus he would have been eligible for at his former employer. He will have a base salary of $1.3 million and be eligible for nearly $6 million in incentive pay.
Mr. Cornell spent Thursday in Minneapolis introducing himself to senior executives and posing for pictures with hundreds of other corporate employees during an impromptu appearance in a common area at headquarters. His days will get a lot tougher on Aug. 12, when he becomes chairman and CEO of fourth-largest U.S. retailer by sales and takes on a long to-do list including fixing a money-losing expansion into Canada and boosting Web sales.
Cowen analyst Faye Landes expressed concern in a research note Thursday that Mr. Cornell had no experience in dramatic turnarounds and limited expertise in selling products in Canada and online.
“He has a big project here and limited experience in turnarounds and in the crucial area of soft goods,” Ms. Landes wrote Thursday.
Mr. Cornell told executives that he would focus on restoring luster to Target’s fashion and home-furnishing lines, a spokeswoman said. In a posting on Target’s corporate blog, Mr. Cornell said his experience at PepsiSHYCo provided a vantage point on how various retailers are trying to figure out the Internet. There, he was one of the strongest advocates for developing an e-commerce strategy, said Jim Wilkinson, PepsiCo’s former head of communications and current head of international corporate affairs at Alibaba Group.
A 55-year-old father of two grown children, Mr. Cornell grew up in New York’s borough of Queens, where as a kid he spent summers washing Tropicana trucks at a distribution facility, earning enough money to buy sporting equipment. In a 2010 commencement speech at the University of California, Los Angeles, his alma mater, he said he idolized basketball coach John Wooden and paid his way through school with jobs in retail and coaching high school football.
After college, he worked at Tropicana and, after it was acquired by Pepsi, at the soft drink maker. He later joined Safeway, where as chief marketing officer from 2004 to 2007 he oversaw the revamp and expansion of the supermarket chain’s private-label products.
Later, while running the Sam’s Club unit of Wal-Mart, Mr. Cornell turned around same-store sales at the warehouse chain from a drop of 1.4% in 2010 to an 8.4% increase in 2012, making it into one of Wal-Mart’s top growing divisions. There, he also focused on developing an improved private-label portfolio as well as attracting more upscale customers to better compete with Costco Wholesale Corp.
After returning to PepsiCo, Mr. Cornell oversaw the company’s key food properties and worked closely with the head of the drink business to market the two sides of the business together. He would often come to management meetings with an iPad full of photos of in-store displays of the products both good and bad.
The business did well under his watch, with sales rising 4% in 2012 and 5% over the past year.
Mr. Cornell would often work out with members of his team, including on road trips before calling on retailers.
Mr. Cornell rejoined PepsiCo in 2012 with a chance to eventually succeed current CEO Indra Nooyi, but he was considered a long shot for the job.
Date: August 1, 2014