Bath & Body Works CEO Daniel Heaf Unveils Turnaround Strategy Amid Earnings Miss; Stock Drops 25 Percent

Core Viewpoint - Bath & Body Works' new CEO Daniel Heaf criticized the existing strategy and introduced a new plan, which includes launching on Amazon next year, following weaker-than-expected third-quarter earnings and a stock drop of 25% to $15.82 [1][2]. Group 1: Strategic Changes - The new strategy, termed the Consumer First Formula, aims to address internal issues to return to growth, with a focus on investing in the brand for sustainable long-term growth by 2026 [3]. - Key components of the strategy include enhancing innovation in core categories, exiting non-core categories like hair and men's grooming, and improving brand positioning through targeted marketing and creator advocacy [4]. Group 2: Market Opportunities - The company plans to launch on Amazon in early 2024, recognizing an opportunity to capture $60 million to $80 million in gray-market sales that are currently brand dilutive [5]. - The strategy emphasizes meeting consumers where they are and operating with greater speed and efficiency to broaden consumer exposure [4]. Group 3: Organizational Changes - Bath & Body Works is expanding its executive team, with recent appointments including Veronique Gabai as creative product and brand adviser, Maly Bernstein as chief commercial officer, and Samantha Charleston as chief human resources officer [6]. Group 4: Performance Issues - The company previously pursued adjacent categories to attract new customers but failed to achieve expected growth, leading to a reduced focus on core categories [7]. - Collaborations intended to drive brand excitement were not effectively utilized, and the retailer relied too heavily on frequent promotions [7].