by Alyssa Oursler | October 15, 2013 10:51 am
Apple (AAPL) has finally hired a new retail chief. AAPL snagged Burberry (BURBY) CEO Angela Ahrendts to oversee its online and physical stores in the latest attempt to turn around Apple stock.
This position at AAPL has been vacant for nearly a year, as Ron Johnson deserted it for his disastrous stint at JCPenney (JCP) and successor John Browett lasted mere months.
Correlation might not be causation, but for perspective, Apple stock slid around 22% during the past 12 months … during most of which there was no AAPL retail chief to speak of.
In fact, AAPL stock peaked just before Browett got the boot.
On top of that, the retail struggles of AAPL are somewhat symbolic of the struggles of the overall company — which means that a retail turnaround could be a bigger deal for the whole company and Apple stock than it seems on the surface.
The Wall Street Journal reported in August that brick-and-mortar retail sales for AAPL fell in the third quarter — the first drop in four years. As the article explained:
“In 2001, Apple changed the retail game when it threw open the doors to the Apple Store’s sleek and bright, modern interiors — completely different from electronics warehouses of the day stuffed with accessories and cords. The stores were temples for all things Apple, and destinations for early adopters.
But today, just as Apple’s products have become ubiquitous, the format of its stores has become commonplace.”
That sentiment toward AAPL retail stores is very similar to the slipping sentiment toward the company that sent AAPL stock spiraling downward in late 2012. Investors were (and continue to be) worried that the innovation and newness which bid Apple stock up so high is waning.
With that in mind, Angela Ahrendts could be a game-changer for AAPL. Retail might not be generally considered the cornerstone of Apple’s business, but it comes with plenty of upside.
If Ahrendts is able to fix Apple Stores, she also could fix the sliding perception of AAPL and, hopefully, help Apple stock continue its recovery.
Jeff Macke at Yahoo seems to think that’s a strong possibility, too. As he put it, “With this hire, Apple isn’t just filling a job vacancy. This is a statement. Ahrendts is an internationally respected merchant at one of the world’s prestige brands.”
Macke also applauded the fact that this is one of the first moves by AAPL CEO Tim Cook that has the potential to organically grow Apple earnings.
And it comes at a much cheaper cost than moves by AAPL that suggest such potential no longer exists, such as an Apple stock dividend or giant AAPL stock buyback.
As of this writing, Alyssa Oursler did not hold a position in any of the aforementioned securities.
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