Apple’s VP of retail Ron Johnson is quitting to take the job as president J.C. Penney, The Wall Street Journal reports.
The company is expected to announce Johnson’s appointment later today. It’s a surprising move.
Update: It’s official. J.C. Penney has confirmed that Johnson will become CEO on November 1. Plus, Johnson is investing $50 million of his own money!
Johnson is famous for re-inventing retail at Apple. It has made him rich and famous. J.C. Penney is the crappy department store you go out of your way to avoid at the mall. However, Johnson will eventually become chief executive of the department store chain, and it has a much bigger footprint than Apple.
Johnson joined Apple from Target in 2000 and was responsible for the concept of Apple’s stores, with their low-key community vibe, solution stations and Genius Bars. He helped build the chain of more than 300 stores into the most successful in retail, including some amazing flagship properties.
The hire is a coup for J.C. Penney, a middle-of-the-road department store chain of 1,100 stores that faces stiff competition from Macy’s Inc. and Kohl’s Corp. Total sales last year reached $17.8 billion, up 1.2% from 2009 though still well below its pre-recession levels.
Mr. Johnson has won kudos for reinventing the concept of the retail store at Apple. Apparel retailers have long admired Apple’s store environments, including their spare, uncluttered layout and use of handheld checkout devices.
Why do you think Johnson moved on? Maybe it’s because his retail peons are getting restless and want to start a union?
UPDATE: It looks like Johnson finally wanted to be a CEO and relishes a challenge. Here’s what he said in J.C. Penney’s statement:
I’ve always dreamed of leading a major retail company as CEO, and I am thrilled to have the opportunity to help J. C. Penney re-imagine what I believe to be the single greatest opportunity in American retailing today, the Department Store. I have tremendous confidence in J. C. Penney’s future and look forward to working with Mike Ullman, the Executive Board and the Company’s 150,000 associates to transform the way America shops.
Johnson is also putting down $50 million of his own money, in a sign of his “confidence” in the company. Weird!
As a demonstration of his confidence in J. C. Penney’s long-term potential, Mr. Johnson requested and has committed to make a personal investment of $50 million in the Company through the purchase, at fair market value, of 7 1/2-year warrants on 7.257 million shares ofJ. C. Penney Company stock. The warrants cannot be sold or hedged for the first six years of their term and have a strike price of $29.92, the closing price of the stock on the business day prior to Mr. Johnson’s commitment to purchase the warrants.