By bringing in a relative outsider to replace longtime CEO Michael J. Kowalski, Tiffany & Co. is showing it wants a more global, luxury-minded perspective, analysts said.
On Monday, Kowalski announced his intention to resign on March 31, 2015, though he will remain on the board and as nonexecutive chairman. He has worked at the jeweler for 31 years and served as CEO since 1999. Under his tutelage, Tiffany’s stock has jumped more than fivefold, from the under-$20 to $100 range. In recent years, the Harvard MBA has become an outspoken opponent of the proposed Pebble mine in Alaska.
Kowalski will be replaced by current company president Frederic Cumenal. Cumenal joined the jeweler only three years ago, having previously served as CEO and president of Moët & Chandon, the LVMH-owned Champagne company.
Analysts said Cumenal will bring a more luxury-minded perspective to the company, which in September hired Francesca Amfitheatrof as design director, with the charge of “interpreting Tiffany in a new way for the modern, global consumer.”
“Mr. Kowalski, we believe, knew adding newness (including Mr. Cumenal himself) was necessary,” wrote David Schick, an analyst with Stifel Financial Corp, according to Bloomberg. “It’s difficult (but powerful) for successful companies or brands to admit they don’t have it all figured out.”
Oliver Chen of Citigroup said that the retailer will “benefit most from Cumenal’s global vision for the brand, enhanced customer experience and selling initiatives, more engaging customer relationship management programs, and continued prioritization of self-purchase driven revenue,” according to WWD.
Rahul Sharma, analyst at Neev Capital, told Financial Times that “while Kowalski has taken Tiffany a long way, fresh leadership has been in the pipeline for a while.” He thinks Cumenal will bring a more global outlook.
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