The CEO who oversaw Ulta Beauty’s rapid expansion will take over as CEO of Foot Locker during an important transition period for the chain.
Mary Dillon, one of the few women to run a company in the S&P 500, resigned as chief executive at Bolingbrook-based Ulta early last year and will replace Richard Johnson at Foot Locker, who retires next month.
Foot Locker shares were up 20% at the opening bell on Friday.
Dillon takes control of the company next month and Foot Locker relies less on sales in malls, where foot traffic has plummeted, and away from one of its most dominant suppliers, Nike. Nike is pursuing an aggressive push to sell its products directly to customers.
Johnson, who has led the company since 2014, will continue as executive chairman of the board until 2023.
Ulta’s market capitalization tripled under Dillon between 2013 and 2021 and it doubled its number of stores and loyalty memberships. He created a partnership to get Ulta into a major retail chain and in front of potential customers who may not be familiar with the brand.
Foot Locker posted its highest annual sales since 1994 in its last fiscal year as the pandemic subsided, which could build momentum as it expands its online sales platforms and opens more independent locations.
Foot Locker says it will maintain its presence in malls, where its referee-striped sales force has been ubiquitous for decades.
It is also diversifying the products that customers see on the shelves. Foot Locker says that by the fourth quarter of this year it expects no single supplier to account for more than 55% of its product budget. Just two years ago, Nike products accounted for up to 75% of Foot Locker’s product spend.
The company also posted strong second-quarter earnings on Friday that easily beat Wall Street expectations.
New York-based Foot Locker has 2,800 stores in 28 countries and reported $9 billion in sales last year. During the second quarter, it opened 34 new stores, remodeled or relocated 24 more and closed 50.
It also owns more than 500 Champs Sports stores and bought West Coast sportswear and shoe retailer WSS in 2021 for $750 million.
Dillon served as Chairman and CEO of US Cellular and held executive and leadership positions at McDonald’s and PepsiCo.