Zales Jewelers flops at the High End
Jewelry retailer Zale Corp. named interim chief executive officer Mary “Betsy” Burton to the post permanently and launched a search for a new chief financial officer. Zale’s board tapped Burton, a director, as its interim CEO in late January after forcing the resignation of Mary Forte, CEO since 2002. Zale’s board made the change following the failure of Forte’s campaign to shift the advertising and merchandise at the retailer’s flagship Zales Jewelers to appeal to a more upscale and fashion-conscious clientele.
Zale, Irving, Texas, has annual sales of over $2 billion. In the United States it operates under the Zales Jewelers, Zales outlet, Gordon’s Jewelers, Bailey Banks & Biddle and Piercing Pagoda brands. In Canada, its brands are peoples jewelers and Mapins Jewellers.
In Burton, Zale gets a CEO with extensive experience on the boards and retailers and in turning around struggling operations. She served as CEO of the hair-salon chain Supercuts Inc. from 1987 to 1991, of a printing concern from 1991 to 1992, and of Revlon Inc.’s 250 store Cosmetic Center Inc. chain from 1998 to 1999. She has served as CEO of two large private ventures:
Toysrus.com in 1999 and Tower Records in 2003.
In January of 2005, after a disappointing Christmas season and amid worries about competition from discount retailers, Zale Corp., decide to shake things up: The self-proclaimed jeweler to Middle America was going to chase upscale customers. In few months, Zale drew up a plan than involved replacing almost a third of the merchandise at its Zales Jewelers division. To dodge a battle with retailers such as Wal-Mart Stores Inc., Zales dropped inexpensive, low-quality diamond jewelry for fashionable 14-karat gold and silver pieces with higher margins. It started buying direct from overseas dealers, cutting out U.S. middlemen, and even dumped a decades –old marketing slogan: “The Diamond Store”.
The move was a disaster. “The Irving, Texas, retailer lost many of its traditional
Zale, Irving, Texas, has annual sales of over $2 billion. In the United States it operates under the Zales Jewelers, Zales outlet, Gordon’s Jewelers, Bailey Banks & Biddle and Piercing Pagoda brands. In Canada, its brands are peoples jewelers and Mapins Jewellers.
In Burton, Zale gets a CEO with extensive experience on the boards and retailers and in turning around struggling operations. She served as CEO of the hair-salon chain Supercuts Inc. from 1987 to 1991, of a printing concern from 1991 to 1992, and of Revlon Inc.’s 250 store Cosmetic Center Inc. chain from 1998 to 1999. She has served as CEO of two large private ventures:
Toysrus.com in 1999 and Tower Records in 2003.
In January of 2005, after a disappointing Christmas season and amid worries about competition from discount retailers, Zale Corp., decide to shake things up: The self-proclaimed jeweler to Middle America was going to chase upscale customers. In few months, Zale drew up a plan than involved replacing almost a third of the merchandise at its Zales Jewelers division. To dodge a battle with retailers such as Wal-Mart Stores Inc., Zales dropped inexpensive, low-quality diamond jewelry for fashionable 14-karat gold and silver pieces with higher margins. It started buying direct from overseas dealers, cutting out U.S. middlemen, and even dumped a decades –old marketing slogan: “The Diamond Store”.
The move was a disaster. “The Irving, Texas, retailer lost many of its traditional