Wal-Mart merchant moves raise stakes in home, apparel

BENTONVILLE, ARK —With back-to-school season in full swing and the holidays around the corner, new hires within Wal-Mart’s merchandising organization are faced with high expectations regarding the time frame in which they will be able to affect change.

Two merchandising segments in particular—home and apparel—stand out as areas where Wal-Mart will be challenged to show significant improvement this year, despite a recent change in leadership. Last month, the retailer named Dottie Mattison senior vp and gmm of women’s apparel and gave her oversight of women’s jewelry, shoes and accessories, as well as Wal-Mart’s recently expanded product development office in New York. Mattison joined WalMart.com in March 2006 and most recently served as head merchant of the online unit. Her expertise in apparel expertise in apparel comes from 12 years spent at Gap Inc. prior to joining WalMart.com.

Mattison assumed a portion of the responsibilities previously handled by Claire Watts, who resigned as evp of merchandising and also had oversight of the men’s, children’s and baby categories. Those areas are the responsibility of vp and gmm Mark Larsen, who had previously reported to Watts but now reports directly to chief merchandising officer John Fleming, as does Mattison.

In a related move, Karen Stucky was named senior vp of product development, strategic sourcing and product quality for the home category. Stucky also had previously reported to Watts and was involved in apparel development as senior vp of product development. She now reports to Wal-Mart’s other significant new hire in the merchandising group, evp of merchandising Linda Hefner. A former Kraft executive, she joined the company several months ago to assume responsibility for the home categories.

With the appointment of Hefner and Mattison in the home and apparel areas, Wal-Mart hopes to restore growth to key, high-margin departments that have suffered from slow sales in recent years as efforts to introduce more fashionable and higher-priced offerings failed to excite customers. While the change in leadership was viewed by analysts as a necessary step, implementing changes in fashion-sensitive soft-line categories can be a lengthy process as inventory must be cleared to make room for the next season. Even with the contraction that has taken place in product development lead times and the support of Wal-Mart’s global sourcing infrastructure, the impact of initiatives put in place this year by Hefner and Mattison likely would not be felt until next year.

In addition to the challenge of jump-starting sales in home and apparel, Wal-Mart’s merchandising organization is weathering a year of unprecedented change that began in January with the appointment of John Fleming as chief merchandising officer. The former chief marketing officer created a new structure for the buying organization that involves five pillar categories, four of which Fleming oversees: grocery, entertainment, apparel and home.

The grocery division is led by senior vp and gmm Pam Kohn, who replaced Bruce Peterson after he resigned earlier this year. The entertainment division is led by Gary Severson, a 13-year Wal-Mart veteran who spent the past four years as senior vp and gmm of electronics. The newly promoted Mattison and Mark Larson share responsibilities in the apparel area, and the newly hired Hefner oversees home along with veteran merchant Beth Schommer who was promoted to senior vp and gmm of home earlier this year.

The pharmacy and optical group report to Bill Simon who earlier this year was named coo of the U.S. stores division after previously serving as evp of professional services and new business development. Paul Beahm, who had served for a short time as senior vp and gmm of the home business and reported to Watts, was shifted back to the pharmacy and health area where he spent the bulk of his career as he was named senior vp and gmm of pharmacy merchandising.

Prior to Fleming’s appointment as cmo, Wal-Mart had functioned since 2003 with a dual head merchant structure. Doug Degn served as evp of food, consumables and hardlines, and Claire Watts served as evp of product development, apparel and home merchandising. With Fleming’s appointment as chief merchant, Degn resigned and Watts saw her responsibilities diminished in a move widely viewed at the time as a precursor to her eventual retirement. In addition to the departure of Degn, and more recently Watts, Wal-Mart also said goodbye earlier this year to former Dollar General executive Lawrence Jackson who briefly served as president and ceo of Wal-Mart’s global procurement operation.

It has been a turbulent year within Wal-Mart’s merchandising group, but it appears the most significant structural and personnel moves are behind the company and chief merchant Fleming has a team in place of his own design.