It seems fitting Dene Rogers was born and raised in Kalgoorie, Western Australia. It is a goldfields heartland, created amid the 1880s rush and famed for its tales of Irish prospectors, old miners’ ghost towns and heritage pubs.
Having inherited Wesfarmers’ worst-performing retail business over the 2011 financial year, Rogers is no doubt hoping to replicate its success stories and strike gold.
Wesfarmers lured the former Sears Canada chief executive to run its discount department store Target late last year, following the resignation of managing director Launa Inman. Inman left behind a strong seven-year legacy, which included the seamless transition of Target into the Wesfarmers Group after its takeover in 2007.
But in accepting the role, Rogers was also to inherit trading challenges; Target reported a 27 per cent fall in full year operating earnings to $280 million, with sales slumping 1.1 per cent to $3.7 billion. Having worked in the United States, Canada, Japan, the UK and China, Rogers felt well-equipped to take on the tough retail market.
“I am excited to be returning to Australia and to be joining Target, an icon of retailing with significant potential, and Wesfarmers, one of Australia’s premier companies,” he said at the time. “I am looking forward to working with the Target team, building upon Launa’s accomplishments and taking Target to new levels of customer value and satisfaction.”
Now settled into his new position, Rogers tells Ragtrader online retailing will form an important part of his vision, with Target making its first significant steps into e-commerce earlier this year.
“I spent the first weeks in the role understanding the business and getting to know the people, as well as accelerating some of the good work that has already begun, such as online,” he says. “Ensuring we stay relevant to a broad range of customers [is important] and making sure we feed the organisation with customer insights so that we can react and stay relevant.”
His international retail experience is what grabbed the attention of Wesfarmers last year, when it conducted a global search for a new managing director. Rogers had been chief executive officer of North American retail giant Sears Canada since 2006, a company which operates mid-tier retail stores, a national catalogue and internet service, travel, home improvement, credit card portfolios and other smaller exploits.
Prior to this, Rogers was based in Chicago as executive vice president and general manager of Sears-owned Kmart (USA), where he was responsible for around 1,500 stores and US$18 billion worth of revenue.
There are many similarities between these companies and Target Australia, which has a broad market appeal spanning its Urban by Target, Target and Target Country stores. Rogers will oversee 24,000 employees and take the business to 300 stores this year, through the launch of its third Urban by Target site in South Australia.
He is confident leading into the milestone.
“Target’s in a great mid-market position, with broad appeal and tremendous customer trust based on style, quality and value proposition,” he says. “Being managing director means I have a responsibility to our shareholders and team members to lead this company to even greater success. To do that we need to not only give the customer what they want but surprise and delight them as well. If you focus on the customer, they’ll vote with their wallet and purses and the results will follow.”
Much like Inman, however, Rogers himself battled against changing retail conditions in his previous role.
In scenes almost identical to those of Australia, Canadian giants such as Sears have been bracing for an onslaught of international brands through their borders, lured by high vacancy rates and competitive retail spending. Recession weary traders such as Target, Mashalls, The Limited and J Crew announced formal plans to enter the market this year, with other American players such as Nordrstrom and J.C Penney also reportedly scouting the scene through local brokers.
When Sears announced Rogers was leaving in June after some five years at the helm, Target Corporation had just revealed its first 105 Canadian store locations and warned it was “just the first wave”. Meanwhile, retail commentators noted Sears itself hadn’t received the attention it needed from its US parent company for some time, with store and merchandise refreshes needed in order to compete with new retailers and existing operators.
Leading up to Rogers’ departure, there had been successive revenue declines, from $5.93 billion in 2006 to $5.73 billion in 2008 and $4.96 billion in 2010. However, Rogers’ tenure with the company also resulted in some of its highest net profits this decade with $304 million generated in 2007 and $289 million in 2008. This is not his only achievement, with Sears Canada chairman William Crowley saying he served the company “diligently” during his reign.
“Dene presided over many initiatives aimed at improving the lives of Canadians,” he said when announcing Rogers’ departure. “Such as the launch of the updated Attitude women’s apparel brand and the significant sales growth of the younger-minded customer, an expanded gift registry service, growth in e-commerce and the introduction of several sustainability programs including those that led to Sears Canada being named as ENERGY STAR(®) Retailer of the Year for the past four consecutive years.
He continued: “Two years ago Dene told me he was considering returning to the US with his family, but wanted to stay while the company weathered the economic recession and hired a management team that could take the business forward. We thank Dene for his loyalty, incredible hard work, and the beneficial changes he brought to Sears Canada.”
It is still too early to tell what kind of legacy Rogers will leave for Target Australia, but his ambitions are not small.
“Our goal is for Target to be Australia’s number one retailer. Accelerating the growth of online is an opportunity, as is improving our supply chain and sourcing back into price for our customers. Making the in-store shopping experience more inspirational will also be a focus for us.”
2011: A look back
Target’s online leap
In the second half of fiscal 2011, Target commences online retailing through an initial launch of babies, kids and school wear before phasing in select women’s and children’s apparel. The website shop.target.com.au is powered by a Hybris solution, with Hybris also teaming with partner LoyaltyTech and systems integrator Sapient Nitro on the project. In its 2011 Annual Report, parent company Wesfarmers notes customer response to the venture is “encouraging” and vows to expand its program to include other product categories. It will also, “continue to explore alternative ways of communicating to customers, including [the] expanded online offering and increased use of social media.”
Urban bound
In August, Urban by Target debuts at 500 Chapel Street, South Yarra. The small-format store fills 1,000m2 of retail space and stocks an edited mix of womenswear, footwear, men’s underwear, babywear, childrenswear, intimate apparel and accessories. Target reveals the new format will spread nationally, with Showgrounds Village Shopping Centre (Melbourne) and Pasadena (Adelaide) next on the agenda. Merchandise is selected based on the demographics of each area, with stores ranging from 1000m2 to 2000m2 in size. Even the interior design is tailored; the trendy Chapel Street store features edgy custom lighting, fixtures, fittings and in-store soundtracks. Interactive customer assistance technology caps off the offer, which is aimed at servicing modern shopping habits.
That letter
In September, disgruntled Target suppliers distribute a letter to select media, including Ragtrader, about a new discount strategy moving into Christmas. Former managing director Launa Inman wrote that challenging retail conditions meant a five per cent rebate would be imposed on all orders between September 26 and December 23. Inman also warned that from January onwards, negotiations between the company and its suppliers would continue to take into account the tough trading climate. Inman defended the move by pointing to savings on the back-end of the retail market. “Since our orders were placed, circumstances have changed, including the Australian dollar and improved commodity price. Rather than renegotiate every cost price, we intend to take an additional five per cent rebate on all orders.”
Grazia coup
In October, consumer fashion magazine Grazia debuts its limited edition capsule collection with Target. The initial ‘Hot Options exclusively for Grazia’ range includes 12 spring/summer pieces co-designed by Grazia editor Kellie Hush and fashion director Thelma McQullian. Sold through 71 Target stores nationally, a further seven new styles were promised for a December drop with prices from $49. Items included maxi and short dresses, a jacket, pants, maxi skirt and several oversized tops in chiffon, crepe and georgette. Key colours ranged from coral, deep blue, black and fuchsia to printed combinations of leopard and stripes. Previous fashion collaborations for Target Australia include Stella McCartney, Josh Goot, Yeojin Bae, Gail Sorronda and Zac Posen.
