Executive to Watch: Maintaining Sam's Momentum Key for Rosalind Brewer

BENTONVILLE, Ark. — Sam’s Club has been one of the bright spots for Wal-Mart Stores during the economic downturn, and it will be up to Rosalind Brewer, the warehouse club’s new president and chief executive officer, to keep it that way.

Named earlier this year to succeed Brian Cornell as the head of the warehouse-club chain, Brewer is a five-year veteran of Wal-Mart’s U.S. division who began her career as a chemist at Kimberly Clark.

Sara AlTukhaim, a senior analyst for the club channel at Kantar Retail, said that although Brewer has proven herself as a manager of a large piece of Wal-Mart’s business — in her most recent role, Brewer was responsible for about 42% of Wal-Mart East Coast U.S. operations — she will have some adjustments to make at Sam’s.

“Brewer joins Sam’s Club as very much of an ‘outsider,’” AlTukhaim explained. “Sam’s Club is a very different model than anything she has dealt with before (that we know of). I think the biggest challenge for her will be whether she is able to transfer her skills and perspectives to a business model as unique as Sam’s Club and to a strategy that fundamentally relies on member acquisition and retention to drive performance.”

AlTukhaim also noted that Cornell “made a lot of progress in infusing a coherent sense of identity in Sam’s Club.”

“For Sam’s to maintain the momentum it achieved under Cornell, it’s vital that it continues to operate and lead as the unique and very separate entity that it is, especially given the high rate of Sam’s Club members who cross-shop Walmart,” AlTukhaim explained. “She undoubtedly has big shoes to fill and the Sam’s team’s receptivity to her is going to rely on how well and how quickly she aligns and reinforces the culture of Sam’s Club.”

Sam’s Club tallied sales of $53.8 billion in the company’s most recent fiscal year, up 8.8% over the preceding year, showing much stronger growth than the Walmart U.S. division.

“I think the main thing she has to do is continue what Brian Cornell started,” said Chuck Cerankosky, an analyst with Northcoast Research, Cleveland.

Top Priority

AlTukhaim of Kantar said Brewer’s top priority is to maintain Sam’s Club’s momentum.

“This year, Sam’s will be building off particularly strong prior-year sales and comps, so this won’t necessarily be easy,” she said. “As she adapts to her new role, Brewer will need to rely on and leverage the strengths of the Sam’s team to drive continued growth — and this should take precedence over any major strategic shifts if she’s to cultivate the internal support necessary to achieve success in her role and for Sam’s Club at large.”

AlTukhaim also said Sam’s Club could benefit from Brewer’s “solid CPG background.”

As Sam’s Club rolls out its Joint Business Program (JBP) this year, it will require a deeper level of alignment between the retailer and its vendors, she explained.

“It will also stretch Sam’s growing, very strategic focus on member insights and analytics — I anticipate Brewer’s CPG hat will be valuable here.”

Sam’s Club’s growing focus on health and wellness could also benefit from Brewer’s background at Kimberly Clark, AlTukhaim pointed out.

“The key will be transcending Sam’s health and wellness message across the box and the many platforms it has in motion (for example, online, mobile, its newly launched Healthy Living Made Simple Magazine, etc.). This is at least in part about brand creation, which crosses the boundaries of retailing and can be strengthened with a CPG background.”

Brewer had joined Kimberly-Clark Corp. in 1984, and held several positions before becoming president of the company’s Global Nonwovens division in 2004. She joined Wal-Mart in 2006, and most recently was president of Wal-Mart’s U.S. East business unit, with nearly 1,600 stores and more than $100 billion in annual revenues.

As Sam’s Club’s first woman CEO and now one of the highest-ranking African American women at the company, her appointment also makes her the face of Wal-Mart’s efforts to recover from accusations of discriminat