Abercrombie Brings In Outsiders in Management Revamp

Abercrombie & Fitch Inc. is restructuring the management of its Abercrombie brand, as it seeks to turn around the ailing chain.

The company plans to announce on Tuesday that it is creating six new positions, part of a strategy to organize executives by brand, rather than product. All but one of the new positions will be filled by recently hired outsiders. The executives will report to Christos Angelides, Abercrombie's brand president.

Abercrombie has been struggling to reinvent itself after its formula for attracting teens with logo-emblazoned shirts and sex-tinged marketing began to falter about two years ago. The company parted ways with longtime Chief Executive Mike Jeffries late last year, and has been looking for a permanent replacement to fill the CEO post.

In the interim, the company has been run by the office of the chairman, which consists of Executive Chairman Arthur Martinez, Jonathan Ramsden, the chief operating officer, Mr. Angelides, and Fran Horowitz, president of the company's Hollister brand, which targets slightly younger shoppers.

Mr. Angelides and Ms. Horowitz are in contention for the CEO job, but much will depend on their ability to win back shoppers who have fled to fast-fashion retailers like Fast Retailing Co.'s Uniqlo chain and H&M, which is owned by Hennes & Mauritz AB. Teens are also shopping at vintage stores and smaller retailers to find more individualistic looks.

Mr. Angelides's move to organize by brand, rather than product, is one being adopted by other retailers, including Ralph Lauren Corp., as they seek to ensure a more consistent brand message that resonates globally.

For the new positions, Abercrombie has tapped executives from Ralph Lauren's Club Monaco chain, PVH Corp., Kohl's Corp. and Carter's Inc.

It isn't clear whether other efforts to stabilize the company are bearing results. In April, the retailer moved to do away with shirtless models at its stores, and is phasing out overtly sexual marketing. It is also making the stores friendlier, with brighter lighting and ensuring that merchandise is more accessible.

Abercrombie & Fitch's first-quarter loss more than doubled from a year earlier, dragged down by charges to implement some of those changes. Total sales fell 14% to $709 million, while sales at existing stores declined 8%. The company is scheduled to release second-quarter results on Aug. 26.

Abercrombie's shares rose 15 cents to $19.17 on Monday. The stock is down 33% so far this year.

Write to Suzanne Kapner at Suzanne.Kapner@wsj.com

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August 17, 2015 23:35 ET (03:35 GMT)

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