Mike Jeffries (CEO)
Michael Stanton Jeffries (born 1944 or 1945)[1] is an American businessman who was CEO of clothing retailer Abercrombie & Fitch from 1992 to 2014. During Jeffries' tenure, Abercrombie & Fitch grew from a "fashion backwater" losing $25 million yearly to a lifestyle brand grossing $2 billion yearly by 2006.[2] Jeffries was criticized for using semi-nude models in his company's advertising, selling clothes with racially and sexually insensitive slogans, and his candid stance that Abercrombie & Fitch marketed solely to the "cool kids".[2]
Mike Jeffries | |
|---|---|
| Born | Michael Stanton Jeffries 1944 or 1945 (age 78–79) |
| Nationality | American |
| Alma mater | |
| Occupation | Businessman |
| Known for | Former chairman and CEO of Abercrombie & Fitch |
| Spouse | Susan Hansen (m. 1971) |
In 2023, Jeffries was named in a civil class-action lawsuit which alleged that during his tenure as CEO of the company, he engaged in sex-trafficking with over 100 young men, in exchange for promises of employment for coveted modeling spots, money, and drugs.[3]
Early life edit
Jeffries grew up in Los Angeles, the son of Donald R. Jeffries, who owned a chain of party supply stores.[2][4] Jeffries attended Claremont Men's College and the London School of Economics before receiving an MBA from Columbia Business School in 1968.[1][2][4]
Career edit
Early career edit
In 1968, Jeffries joined the management training program at Abraham & Straus, a Brooklyn department store which was owned by the umbrella corporation Federated Department Stores, which was rebranded Macy's in 1994 after that property was acquired by Federated. He worked for 12 years at Abraham & Straus, before moving to Bullock's in Los Angeles, owned by Federated, as executive vice president for merchandising. He then worked for three years at Federated headquarters in Cincinnati, Ohio.[5]
In 1984, Jeffries founded Alcott & Andrews, a brand targeted at career women.[5] The store fell into bankruptcy in 1989 due to over-expansion and closed,[6][7] with the New York Times noting that the store offered "too little variety in its merchandise."[8]
After the Alcott & Andrews bankruptcy in late 1989, Jeffries worked in merchandising at Paul Harris, a Midwest clothing chain that also went bankrupt, in early 1991.[9][2][8][10]
Abercrombie & Fitch Co. edit
Jeffries ran the company from 1992 to 2014. During that period, he completely changed the brand, image and focus of the company. It was a successful turnaround during the 1990s and early 2000s. He was a controversial CEO. After a string of bad results during the financial crisis of 2007–2008, plus other controversies related to the brand he created, he stepped down in 2014.
1990s edit
Jeffries was hired in 1992 by Les Wexner (CEO of LBrands, then named The Limited) to invigorate Abercrombie & Fitch.[11] The company, founded in 1892, had been purchased by Limited Brands in 1988 after bankruptcy.
Jeffries was the main architect of the company's new brand.[2] It was rebuilt as an upscale apparel retailer for the collegiate. He built the brand around "sexualized marketing", for example shirtless beefcake male models greeting patrons in stores, and likewise scantily-clad male models posing in sexually-suggestive positions in large advertisements and billboards.[12] Jeffries created a cult following among young buyers.[12] By the mid-1990s, Abercrombie & Fitch had opened dozens of new stores globally.[2] "Abercrombie led the pack of teen fashion brands in the 1990s largely as a result of the image created by Mr. Jeffries", according to the Wall Street Journal.[12]
2000s edit
The approach also became a liability for Jeffries and the store, "the marketing approach that made A&F into a financial success also made it an HR and PR nightmare".[13][12] A&F attracted controversy from different interest groups, such as the feminist movement and the American Decency Association, and a number of lawsuits ensued.[2] In 2003, Black, Latino and Asian American employees filed a class action lawsuit against the company claiming that minority applicants were discouraged from applying.[13] The American Decency Association called for a boycott of A&F.[13] A group of Pennsylvania high schoolers called for a "girlcott" of the brand.[13] An outspoken businessman, Jeffries made statements in the press that were controversial.[14] For example, he once said, "We hire good-looking people in our stores. Because good-looking people attract other good-looking people, and we want to market to cool, good-looking people. We don't market to anyone other than that."[14]
In 2004, he earned approximately US$25 million with a "stay bonus" of $6 million, which dropped from $12 million after a controversy involving his "excessive compensation".[2] After surveying 2,000 US corporations, the Corporate Library named Jeffries as the "Highest Paid Worst Performer" of 2008, after he received a compensation package valued at $71.8 million.[15] Jeffries refused to lower prices or offer discounts at Abercrombie & Fitch stores during the retail recession of the financial crisis of 2007–2008, until September 2009, after the company posted same store sales losses for 17 consecutive months.[16] Sales recovered in 2011.[17] His total compensation in 2011 was estimated at $46,609,075, most of this being in the form of stock options.[citation needed] As of 2012[update], Jeffries owned about 2.9% of the company's shares, making him difficult to remove without his consent. At that time, his recent contract called for a payout of over $100 million should he lose his job due to an ownership change.[18] Jeffries was once one of the best-paid CEOs in retail but he saw his compensation shrink 72 percent in 2013. His total pay was $2.24 million in the fiscal year of 2013, which ended February 1. That was down from $8.16 million in the previous year and $48.1 million before that.[19]
Jeffries business reputation sank in 2013, when TheStreet's Herb Greenberg named Jeffries the worst CEO of 2013. Greenberg pointed out that the share price for A&F had collapsed by 40% during the year.[20] This was after Jim Cramer of CNBC had earlier named Jeffries to his "Wall of Shame".[21]
On December 9, 2014, Jeffries stepped down as A&F CEO amid mass criticism of the company's performance and 11 straight quarters of negative company comparable-store sales. The shares jumped 8 percent after the move was announced, marking the biggest one-day gain in more than nine months.[19][22] On top of his standard pension, Mike Jeffries received lifetime bonus payments totaling about $1m a year. Following allegations of sex trafficking in late 2023, the company stopped making the bonus payments.[23]
In 2022, Jeffries' leadership of A&F was the subject of a Netflix documentary, White Hot: The Rise & Fall of Abercrombie & Fitch, which focused on Jeffries' transformation of A&F into an "avatar of exclusivity and soft-core sex appeal." The film's focus is the buildup to a 2003 class-action lawsuit against the company.[24]
Personal life edit
In 1971, Jeffries married Susan Hansen,[4] and they have a grown son.[2]
Salon.com reported in 2006 that Jeffries is a "gay man"[25] who lives separately from his wife.[2] As of 2013, Jeffries was reported to be living with his partner, Matthew Smith (born c. 1963),[26][27] and three dogs.[18] Smith was more than a romantic partner, he also headed the Jeffries Family Office, an Ohio limited liability corporation that "advocates for the personal interests of Jeffries."[26] At Abercrombie & Fitch, Smith reviewed internal documents and consulted on real estate matters, despite holding no official position in the company or being professionally qualified to handle such matters.[18] Smith's involvement was criticized for being poor corporate governance,[26] and was likely a factor in Jeffries's decision to leave the company in 2014, according to GQ.[17]
Controversies edit
In a 2006 interview with Salon, Jeffries stated that his clothing line was exclusively for "cool" people. Moreover, he has said he did not want overweight or unattractive people to wear his clothes.[2] The comments, which came to light in 2013, drew negative publicity and criticism for the company.[28] Jeffries issued a public apology on May 15, 2013, stating that "We are completely opposed to any discrimination, bullying, derogatory characterizations or other anti-social behavior based on race, gender, body type or other individual characteristics".[29]
In October 2012, Bloomberg News first reported on Jeffries' standards for his cabin crew on Abercrombie's Gulfstream G-V Jet, used by Jeffries, Smith and their dogs.[30] The male models who work as stewards aboard the company jet were required to wear Abercrombie-branded polos, jeans, boxer briefs and flip-flops as part of their uniform, as well as a "spritz" of cologne. This information then came to light as a result of a lawsuit that claimed Jeffries fired his own jet pilot in order to replace him with a much younger man.[18] The suit was quickly settled out of court when Jeffries was ordered to testify by the presiding judge.[31] Male house staff for Jeffries, paid for by the Jeffries Family Office, were provided by the same modeling firm that supplies male staff for the company jet.[18]
Sex-trafficking investigation and lawsuit edit
In 2023, the BBC completed a two-year investigation into several allegations that Jeffries and his cohorts exploited young adult men for sex. The events allegedly occurred in Jeffries's New York residences and at luxury hotels around the world.[27]
According to twelve men interviewed by the BBC, Jeffries's and Smith utilized a middleman named James Jacobson, a man with "a missing nose covered with a snakeskin patch," to recruit unsuspecting men for these events. Hopeful models met with Jacobson under the guise that he could open doors to Abercrombie & Fitch modeling jobs and were then coerced into sex acts in exchange for an introduction to Jeffries.[27] According to would-be model David Bradberry:
[Jacobson] made it clear to me that unless I let him perform oral sex on me, that I would not be meeting with Abercrombie & Fitch or Mike Jeffries... It was like he was selling fame. And the price was compliance.[27]
After being vetted by Jacobson, the men would be invited to events at hotels or Jeffries's residences. Upon arrival, attendees were required to sign non-disclosure agreements, with little time to read said documents, and were not allowed to keep copies. Members of Jeffries's personal staff, dressed in Abercrombie & Fitch uniforms, monitored attendees, including during sexual activity. Men interviewed by the BBC described feeling pressured to perform for the sake of their careers, and that the environment made it so they "didn't feel safe to say 'no.'"[27]
In October, a few weeks after the BBC report, Jeffries and others were sued in New York by a former model under a civil class action complaint of sex-trafficking.[3][32] The former model alleged that Jeffries and Smith would look for prospective men on the Internet, provide them with money, drugs and promises of recruitment, and then sexually exploit them, with the explicit understanding their sexual cooperation was the price for the coveted job.[32][3] Per the suit, these practices occurred between at least 1992 and 2014. It estimates that over a hundred young models were possibly victimized. Jeffries, Smith, and the Jeffries Family Office are named in the suit. Jeffries through his lawyers responded with "no comment in the press on this new lawsuit".[3]
References edit
- ^ a b Earnest, Leslie (October 29, 2002). "A&F Muscling in on Southland Surf Wear Firms". The Los Angeles Times. p. C7.
The 57-year-old Jeffries...attended Claremont McKenna College, said company spokesman Tom Lennox.
- ^ a b c d e f g h i j k l Denizet-Lewis, Benoit (January 24, 2006). "The Man Behind Abercrombie & Fitch". Salon.com. from the original on April 20, 2022. Retrieved September 15, 2022.
- ^ a b c d D'Innocenzio, Anne (October 27, 2023). "Abercrombie & Fitch slapped with lawsuit alleging sexual abuse of its male models under former CEO". The Associated Press. Retrieved October 28, 2023.
- ^ a b c "Susan Hansen Sets Nuptials". Society. The New York Times. March 14, 1971. Retrieved April 19, 2022.
- ^ a b "Apparel Chain Planned, By Ex-Federated Aide". Business People. The New York Times. June 10, 1983. Retrieved October 28, 2023.
- ^ Barmash, Isadore (September 1, 1989). "Alcott & Andrews Seeking Protection From Creditors". The New York Times. Retrieved April 19, 2022.
- ^ Barmash, Isadore (October 14, 1989). "Alcott & Andrews to Close Its Stores". The New York Times. Retrieved April 19, 2022.
- ^ a b Shaer, Matthew (February 9, 2014). "Why Abercrombie Is Losing Its Shirt". The Cut. Retrieved October 28, 2023.
- ^ Berfield, Susan; Rupp, Lindsey (January 22, 2015). . Bloomberg News. Archived from the original on June 14, 2017. Retrieved January 22, 2015.
- ^ Laura, Bird (October 7, 1997). "No Detail Escapes the Attention Of Abercrombie & Fitch's Chief". The Wall Street Journal. Retrieved October 28, 2023.
- ^ Feller, Madison (April 19, 2022). "Where Is Mike Jeffries, Abercrombie & Fitch's Former CEO, Now?". Elle. Retrieved April 20, 2022.
- ^ a b c d Kapner, Suzanne (April 24, 2015). "Abercrombie & Fitch Dials Back The Sex". The Wall Street Journal. Retrieved October 29, 2023.
- ^ a b c d Olson, Emily (October 4, 2023). "Abercrombie & Fitch investigates claims that its ex-CEO exploited men at sex events". NPR. Retrieved January 1, 2023.
- ^ a b Farfan, Barbara (August 23, 2018). "Quotes from Mike Jeffries, former Abercrombie & Fitch CEO". The Balance—Small Business. Retrieved April 19, 2022.
Quotes About His Business Philosophy and Sexualizing a Retail Brand... Protesters speaking out against Jeffries' controversial statements
. - ^ Rooney, Ben (September 28, 2009). "Corporate Library 'Highest Paid Worst Performers' 2009". CNN. Retrieved May 12, 2010.
- ^ Farfan, Barbara (September 7, 2009). . Barbara's Retail Industry Blog. Archived from the original on September 12, 2009. Retrieved April 19, 2022 – via About.com.
- ^ a b Jannuzzi, John (December 9, 2014). "Abercrombie CEO Mike Jeffries is Out, but How Bad Has it Gotten, Really?". GQ. Retrieved May 21, 2021.
- ^ a b c d e Maheshwari, Sapna (October 18, 2012). . Bloomberg Businessweek. Archived from the original on June 6, 2013. Retrieved May 9, 2013.
- ^ a b Rupp, Lindsey (December 9, 2014). . Bloomberg Business. Archived from the original on February 4, 2017.
- ^ Greenberg, Herb (December 19, 2013). "And the Worst CEO of 2013 Is...?". TheStreet.com. Retrieved April 19, 2022.
- ^ Brodie, Lee (November 14, 2013). "Top CEO lands on Cramer's Wall of Shame". CNBC.com. Retrieved April 19, 2022.
- ^ Kell, John. "Abercrombie's CEO Mike Jeffries steps down". Fortune. Retrieved December 10, 2014.
- ^ Croxford, Rianna (November 21, 2023). "Abercrombie & Fitch suspends payments to ex-CEO after sex-trafficking claims". BBC. Retrieved January 12, 2024.
- ^ O'Sullivan, Michael (April 23, 2022). "What to stream: 'White Hot: The Rise and Fall of Abercrombie & Fitch'". The Washington Post. Retrieved November 18, 2022.
- ^ Lowder, J. Bryan (December 11, 2014). "An Ode to Abercrombie". Salon.com. Retrieved September 16, 2022.
- ^ a b c Maheshwari, Sapna (May 22, 2013). "Abercrombie Execs Troubled By Involvement Of CEO's Partner". BuzzFeed News (BuzzFeed.com). Retrieved April 19, 2022.
- ^ a b c d e Croxford, Rianna (October 2, 2023). "Abercrombie & Fitch ex-CEO accused of exploiting men for sex". BBC Panorama. Retrieved October 2, 2023.
- ^ Lutz, Ashley (May 3, 2013). "Abercrombie & Fitch Refuses To Make Clothes For Large Women". Business Insider.
- ^ Sozzi, Brian (December 9, 2014). "3 Huge Reasons Abercrombie CEO Mike Jeffries Lost His Job". TheStreet. Retrieved January 16, 2020.
- ^ Chittum, Ryan (October 19, 2012). "A CEO's High-Flying Standards". Columbia Journalism Review.
- ^ Maheshwari, Sapna (November 21, 2012). "Abercrombie Settles Pilot Lawsuit After CEO Ordered to Testify". Bloomberg Business. Retrieved October 2, 2015.
- ^ a b "Bradberry et al. versus Abercrombie & Fitch Co., Michael S. Jeffries, Matthew Smith, and The Jeffries Family Office, LLC" (PDF). United States District Court for the Southern District of New York. October 27, 2023. Retrieved October 28, 2023.
External links edit
| External image | |
|---|---|
| Photo used in Salon.com interview |