Dive Brief:
- Neiman Marcus Group on Tuesday said it plans to lay off less than 5% of its workforce, or about 500 people across the organization, as part of a “strategic realignment to accelerate high-value luxury customer growth.” A Neiman Marcus spokesperson confirmed that 100 of the job cuts will impact corporate employees, while the remainder will be spread across the company.
- The retailer this week also made another round of changes to three members of its group-level leadership team. Chief Product and Technology Officer Bob Kupbens is leaving the company, and Bergdorf Goodman President Darcy Penick will assume group-level leadership of the Neiman Marcus Group product and technology organization. Neiman Marcus President Ryan Ross will lead customer insights for the group.
- These leadership changes come a month after the company created two new executive roles – chief brand officer and chief retail officer. Neiman Marcus also named new supply chain and technology chiefs in January 2022.
Dive Insight:
Dallas-based Neiman Marcus Group says it employs about 10,000 associates.
"It is always our intent to minimize the impact to existing associate jobs, and we take these types of decisions very seriously. We will support those associates who will be leaving the company with severance and other benefits," Neiman Marcus Group CEO Geoffroy van Raemdonck said in an announcement.
Neiman Marcus confirmed to Retail Dive that the cuts are expected this week. In an interview with the Dallas Morning News, van Raemdonck said the layoffs won’t affect the retailer’s ability and desire to focus on customers.
The company said it has also identified open positions that it will fill based on its "strategic business needs." As it restructures its leadership, Van Raemdonck lauded the experience of its executives and the value they’ll bring to their new roles.
Penick, who will lead the group’s product and technology organization, has “deep leadership experience” in digitally-led customer strategy, per the release.
"Bergdorf Goodman is a key driver for the company's growth through BG.com," van Raemdonck said. "Darcy's strategic leadership of [Neiman Marcus Group]'s product and technology roadmap will ensure the right suite of tools, platforms and resources are aligned to our most important investments in the customer experience and key capabilities across Neiman Marcus and Bergdorf Goodman."
Ross has past leadership roles in integrated channel strategies and customer migration and “his role will accelerate customer-informed decisions across [Neiman Marcus Group],” van Raemdonck said.
The company is two and half years removed from bankruptcy. Weighed down by billions in debt, Neiman Marcus Group, which also owns Bergdorf Goodman, was one of the most high-profile retailers to file for bankruptcy during the pandemic. The company filed for Chapter 11 in September 2020 and exited bankruptcy later that month.
Neiman Marcus Group is privately held and not required to report comprehensive financial information. But the group said it reached 80% full-price selling and an 11% EBITDA margin for fiscal 2022.
Partly in response to slowing post-pandemic momentum in retail, van Raemdonck recently told Fortune in an interview that the company is narrowing its focus to its top 2% of customers. People in that category account for 40% of Neiman Marcus’ total sales.
Eighty percent of Neiman Marcus’ top customers have a net worth of at least $1 million, spend over $25,000 annually and buy products from a Neiman Marcus Group brand at least 25 times a year, the company said last fall.
“The company's new loyal customers tend to be younger, spanning from Gen X to Gen Z, as younger customers entered the luxury market during the pandemic,” the company said at the time. “They migrate up the engagement spectrum, reflecting growing incomes and desire for luxury.”
Correction: A previous version of this article misstated when Neiman Marcus hired its chief supply chain and technology chiefs. They were hired in January 2022.
