Nordstrom regains control of underperforming Rack division with executive retirements.

• Nordstrom has announced that it is streamlining the leadership of its struggling Rack business with that of its full-line department stores, as two executives retire and company veterans take over.
• Ken Worzel, currently the chief operating officer at Nordstrom, and Jamie Nordstrom, currently the president of Nordstrom stores, have been appointed to new roles as the chief customer officer and chief stores officer, respectively.

The company announced on Monday that it is streamlining the leadership of its struggling Rack business with that of its full-line department stores, as two executives retire and company veterans reclaim oversight.

Nordstrom's chief marketing officer, Scott Meden, and Rack president, Geevy S.K. Thomas, are both leaving the department store chain, according to a release. Both Meden and Thomas have been with Nordstrom for over 37 years.

Ken Worzel, currently the chief operating officer at Nordstrom, and Jamie Nordstrom, currently the president of Nordstrom stores, have been appointed to new roles as the chief customer officer and chief stores officer, respectively.

Nordstrom stated that by centralizing its customer strategy under one leader and consolidating the responsibility for its brick-and-mortar stores, it will "more closely align operational oversight with the company's Closer to You strategy."

Erik Nordstrom, Nordstrom's Chief Executive Officer, stated that the new leadership structure is a natural evolution resulting from the company's focus on providing exceptional customer service through all channels and banners.

Recently, Nordstrom Rack, which was previously a significant contributor to Nordstrom's growth, has faced challenges in increasing revenue. Management has attributed this, in part, to difficulties in obtaining merchandise due to supply chain disruptions caused by the Covid pandemic.

In Q4 2021, Nordstrom's Rack sales decreased by 5% compared to the previous two years, underperforming its full-price stores. However, this was an improvement from the previous quarter, where Rack sales fell by 8% compared to 2019 levels.

Nordstrom Rack offers trendy clothing from top brands at more affordable prices, similar to competitors like H&M, Zara, Saks Fifth Avenue and Backstage.

Nearly 3% of Nordstrom shares rose in afternoon trading Monday, with a year-to-date increase of about 25%.

Find the full press release from Nordstrom here.