What Retail Experts Think About Lowe’s Marketing Reorg

Marisa Thalberg, chief brand and marketing officer at Lowe’s, has left the home improvement retailer as part of a corporate reorganization.

Lowe’s said last week that it was doing away with the CMO role and that its marketing team would now report to Bill Boltz, executive vice president of merchandising. The retailer said that Jen Wilson, senior VP, brand and customer marketing, has been promoted to senior VP, enterprise brand and marketing and will report to Mr. Boltz.

The retailer’s online team and Mike Shady, senior vice president of online, which previously reported to Mr. Boltz, will now report to Seemantini Godbole, Lowe’s chief digital and information officer.

A company spokesperson told Ad Age that the reorganization was necessary “to improve alignment across the business …, we need deep integration between marketing, merchandising and stores.”

There was a wide range of responses to the reorg from the experts on the RetailWire BrainTrust in an online discussion last week, with some unconvinced that stacking marketing under merchandising was the right way to align things.

“This move by Lowe’s is a bit of a head-scratcher,” wrote David Spear, senior partner, industry consulting, retail, CPG and hospitality at TeradataTDC
. “Let’s remember, Lowe’s reported annual income of $96 billion in 2022. One would argue a company this size can’t afford NOT to have a CMO reporting directly to the CEO, and second, moving a C-1 individual under merchandise will inherently reduce the impact of marketing initiatives. It’s unfortunate because I thought Lowe’s had terrific momentum from a marketing standpoint and was soundly executing uniquely experiential plays.”

“From my experience, that’s a mistake,” wrote Lee Peterson, EVP of thought leadership and marketing at WD Partners. “Merchandising is short-term thinking: what did I sell today? Marketing is long-term thinking: how can we further the brand? To have merchants, who are incentivized by sales and profit and not long range brand goals (other than outside brands) not thinking in terms of the future. And maybe that’s what Lowe’s needs; sales now, but in the long run this will not play out well for them.”

“I [will refer to] merchandising as promotion,” wrote professor Gene Detroyer. “I have been a marketing manager and a promotion manager. Each demands an entirely different mindset. Marketing is longer-term. Promotion is short-term. When marketing is the tail on the promotion dog, the company loses focus on the brand. While promotion is important, the brand is what carries a company into the future.”

The Ad Age piece points out that it’s unusual for retailers to place marketing under merchandising. Richard Sanderson, a consultant at Spencer Stuart, said the practice was more common in grocery more than a decade ago when “marketing was really driving weekly promotions and print circulars.”

Some on RetailWire’s BrainTrust, however, were more bullish about the possibilities of the new setup.

“I agree with a more product-first approach, not to discount marketing, but it has to start with the right product,” wrote Brian Delp, CEO of New Sega Home. “From there, you can clearly define the features and attributes that are marketable. It will be interesting to see how this develops and if others follow.”

Others saw more potential with a reorg of a different order.

“I have long wished for better alignment between marketing and merchandising, and I admire Lowe’s willingness to take this bold, but risky step,” wrote Dave Bruno, director of retail market insights at Aptos. “However I always envisioned it the other way — merchandising reporting to marketing.”

“A brand’s value and the ability to fulfill on the promise should drive all decisions,” wrote Patricia Vekich Waldron, founder and CEO of Vision First. “I’m all for removing by silos, but this move is backwards — marketing should drive merchandising.”

Though that suggestion too had its opponents.

“The ascendancy of marketing was a 21st century thing and, in my opinion, created as many problems as it solved, including them running their own IT departments,” wrote Paula Rosenblum, co-founder of RSR Research. “Let’s put it this way — I’d rather marketing report to merchandising than the other way around.”

Ms. Thalberg’s departure, CNBC reports, follows two straight quarters during which Lowe’s posted same-store sales declines against strong year-over-year comps. Lowe’s benefited in 2021 from its customers receiving government stimulus checks and focusing more of their attention on their homes in the face of the pandemic. Consumers in 2022 have focused their spending on necessities and cut back on discretionary spending as a result of rising prices and economic uncertainty.

Ms. Thulberg’s exit from Lowe’s is likely to be followed by others at retail as more companies look for answers to boost sales during a period when customer demand has slowed, inventory has piled up and companies engage in a steady stream of markdowns to move merchandise as the Christmas season draws near.

But as other retailers may be looking at ways to rearrange responsibilities and direct reports, some on the BrainTrust say they expect no real change from this particular shakeup.

“Marketing is part of merchandising anyway,” wrote Ananda Chakravarty, vice president of research at IDC. “Merchandising sells products and marketing needs to support it — hence the importance of alignment. This move though is caused by a leader exit, but Lowe’s has taken the right steps to fill in the gap.”

“Honestly this is the way it always was,” wrote Ms. Rosenblum. “Either under merchandising or a quasi-peer. Retailers don’t sell branding. They sell products. Then marketing and merchandising work together to determine which products they can buy specifically for promotion.”