Thursday, July 27, 2006

Exclusive: Burton shares vision for Zale

By Susan Thea Posnock

JULY 27, 2006 - Irving, Texas -- New Zale Corp. president and CEO Betsy Burton has hit the ground running in terms of turning around the company.

As acting CEO since February, she says the board of directors gave her the power to make changes immediately, versus placing the company in a holding pattern until a replacement for former CEO Mary Forte—who left the company at the end of January—had been found.

That appears to have been a good strategy, given the challenges faced by the retailer, which has lost market share to rival Sterling Jewelers, and was left reeling after a disappointing holiday season in 2005.
Burton tells NATIONAL JEWELER, in an exclusive interview, that gaining that market position back is the main objective for the company.

"Over the past few years Zale has been losing market share," she says. "I think the critical focus is to get the Zales brand on track."

In terms of a time frame, Burton estimates it will take anywhere from 12 to 18 months to really put her plan in place and reap the benefits. She's confident that things are already moving in the right direction.

"I think there will clearly be tangible evidence of progress for this holiday," she says. Burton has charged John Zimmermann, who was named president of Zale North America earlier this year, with the task of getting the Zale brand back on track.

Among the key aspects of achieving this is what she calls a return to the store's roots.

"Last holiday we had de-emphasized diamond fashion and solitaires and had emphasized gold and silver. We are returning back to our diamond store heritage," she says.

That also means returning to the core Zale customer, she adds.

"It's simply going back to our roots. Recognizing our customer is really Middle America. Recognizing that our customer looks at Zale as 'The Diamond Store,'" Burton says.

However, that shift back isn't just a matter of scrapping the ill-fated strategy of trying to move upscale, but taking what worked in the past and building on that.

"It's really going back to our roots but improving upon that. Not just going back to what we were," she says.