Turnaround Leadership with Matt Baer, CEO of Stitch Fix

A Podcast About Leadership

In this episode of A Podcast About Leadership, host Jonathan Kirschner sits down with Stitch Fix CEO Matt Baer and executive coach Jamie Ramsden to dissect the mechanics of leading a

Key takeaways

• Matt Baer became CEO of Stitch Fix in June 2023 during a significant business dip and executed a three-phase turnaround that returned the company to consecutive quarterly growth by late 2024.
• Baer champions hybrid intelligence, deploying AI internally and client-facing tools specifically to enhance stylist-client relationships rather than automate them away.

Main topics

• Turnaround leadership and transformation sequencing
• Hybrid intelligence and AI in retail customer experience

Notable quotes

"Our utilization of AI is about help and not hype... to improve and empower that human connection, not to fundamentally replace it."

Conclusion

The episode delivers a practical blueprint for leading through organization

Transcript preview

Speaker 1 (0:15) Welcome to a podcast about leadership brought to you by Air Consulting. I'm your host, Jonathan Kirshner. Each episode, we sit down with leaders and leadership experts to explore what it really takes to lead well. Let's dive in. Welcome to a podcast about leadership. This is Jonathan Kirshner. I'm your host today, and I have two incredible people on the podcast. Jamie, who is becoming like a regular, is probably confused right now because usually I'm coming in on this podcast with a nice sport coat and a kind of plain vanilla shirt. And here I am. It is summer, but this is, if you know my personality, there are seashells and palm trees on this shirt. This is atypical, uncharacteristic, and one might ask, you know, why am I wearing such a shirt? Speaker 1 (1:16) So here's the deal. Basically, I'm going on a summer vacation. I got some there's some fashion demands made on me. And I'm like, how do I make this happen? I don't have time to go shopping right now. It's crazy busy. And then it occurs to me, I've got a podcast in three weeks with Matt Baer, CEO of Stitch Fix. How about I try out the product itself? How about I go on Stitch Fix? I'm a new customer. I'm a very happy customer. This came from my personal shopper after going through the AI and, you know, sort of like personal information. The fit was incredible. And I'm delighted to have Matt and Jamie on the show today. This is not a podcast where we just like pontificate about leadership abstractly or try to like, you know. infused leadership theory. This is about leadership applied. It's in the trenches. What is it like to lead? Whether we're trying to scale something, whether we're trying to maintain something, whether we're trying to turn something around. Leadership has its various strategic contexts. And today we're going to dig in to a really, really compelling strategic context at Stitch Fix. And so let me introduce you both and let's dive right in. So Matt's, as I mentioned, the CEO. And Stitch Fix is a leading, to me, it's like the best personal styling service. It's leveraging incredible insights and knowledge about its customer. And it's doing that through a combination of human and AI, which is just like incredible that everybody who listens to me knows I love hybrid intelligence. So it's really. Really an incredible example of that. And Matt became CEO in June 2023. The company was actually in a bit of a dip, if you will. And he has been very, very focused on leading a transformation that has now returned the business to growth. So that is just awesome. It's funny, like you could talk about that as like a business school professor, a case study. I happen to be a CEO. Jamie happens to be a CEO. We know what that actually feels like. So congratulations to you, Matt. And I know transformation, you know, it has a beginning. I don't know if it has an end. It'll be great to talk and hear about your perspective on that. But you're certainly on the journey. And Matt came to Citrix from Macy's, where his chief customer officer and digital officer, leading the digital strategy for Macy's and Bloomingdale's, while driving initiatives focused on deepening customer relationships. And then prior to that, he was VP of e-commerce at Walmart and played a key role in their transformation of the digital business. Clearly, retail is in Matt's DNA. And actually, growing up, you actually worked in your family business, which was a furniture business. So really in the DNA there. Jamie, he is our... Speaker 1 (4:46) CEO, coach extraordinaire, and author of one of my favorite books, Let's Go. Jamie himself has led a turnaround and a transformation as CEO of an automotive parts company and is actually Matt's coach. So it'll be great to actually learn more about how that's going. Matt, I mean, as I mentioned, you kind of just like grew up. in retail. You were sort of born into it. And the family's furniture store in Florida, a family business started by your great-grandfather. Yeah? Speaker 2 (5:23) Yeah, great-grandfather, 1945. Unbelievable. Speaker 1 (5:26) That's incredible. That's really incredible. So I just, my first question to you is, you know, growing up in that world, what did you learn, you know, from seeing your, you know, your... your family and and from being in the store and connecting with customers what did you learn about leadership and what did you learn about the customer Speaker 2 (5:51) Yeah, I appreciate you starting there. I love talking about that and the unique opportunity I had growing up immersed in a family retail business. But also just want to appreciate the opportunity to be on here today and appreciate the really kind introduction as well as the fact that you're now a Stitch Fix client and did a phenomenal job selling the exceptional service that we can provide everyone. And I'll also vouch that Jamie is definitively an extraordinary coach and feel lucky to have that relationship with him and excited for the conversation today. But look, growing up in a retail family business, you learn so many things. And it probably wasn't or definitively wasn't until I was much older that I recognized just how lucky I was to have had that experience. And reflecting back on it, there are several things that come to mind that would have impacted, you know, how I think about leadership and how I think about the customer experience overall. When I was 16 years old, I used to go from high school to the local showroom. And I would have to like code shift both mentally as well as, you know, change into a suit and walk into the showroom and was, you know, in many ways the evening manager of that showroom. And it felt like second nature growing up in a family business. That might just be something that everyone does. But the idea of being a 16 year old. in the showroom, working with clients one-on-one and having a full staff of employees, both front of house and back office, you learn a lot. One thing that you learn is the importance of brand. When the family name is on the door, you understand just how cherished a brand is and how important it is for you to show up every day in terms of how you build. your relationships with clients, how you treat your employees, and ultimately how you're known within your community. And that, you know, has definitively stuck with me throughout my career. Another important learning is just when you're on the sales floor and a client walks in the door, you greet them, you know, hey, welcome to Bears Furniture. I'm Matt Baer. How can I help you? And you start asking questions to get to know them better. Why are they in the store today? What styles do they like? What rooms are they shopping for? You try to ask around questions to understand what their budget might be. And all of that information becomes so critical so that you can give that individual client the absolute best level of service. That's one of the many reasons why I was so excited about the opportunity that I have now at Stitch Fix. From a leadership perspective and how you work with the team, not too dissimilar from how you want to get to know every client one-to-one, with employees and team members, you really want to meet them where they are, get to know them individually. What are their motivators? What brings them to work? What will get them excited about their responsibilities? How to set them up for success? And that's always been a focus of mine. And I try to put my best effort there to create unique experiences for each individual within my team to maximize their potential, to drive their engagement and to best ensure their happiness at the end of the day. And then maybe the final thing that I'd share too, and you really just have to trust your instincts. You have to be confident. in yourself. You have to have clarity in your communication and you want to have consistency in your leadership. And, you know, when you do that, you're often going to get the best results out of your team at the end of the day. Speaker 1 (10:02) I love that. Jamie, you grew up in a family of musicians. Would that teach you about leadership? Speaker 2 (10:10) Well, Speaker 1 (10:12) I think. Speaker 3 (10:13) I'll be very brief here, but I think growing up with musician parents, it gave us access to lots of people. We covered the whole social community. So we had artists and creative people. And then my parents also worked with and for business people. So we'd be dialed into the community and we'd see all of the adults. So as a kid, I got to see, I think, what I'd call the common humanity amongst people. There's a role that you play. There are preferences and predispositions that you have. But what we were able to see is that people love to be connected. They love to have fun. They love social interaction in general, introverts or extroverts. But just like that binding, that common humanity that brings us together, which is ultimately the essence of leadership. It's about, you know, unlocking, understanding people's motivations, as Matt just said. Understanding what they're looking for, satisfying their needs. A fulfilling life includes that, whether it's with your family or your friends, your spouse, you know, or your workplace. It's about understanding people's needs and being able to serve those. Speaker 1 (11:21) Now, fun fact, Jamie, your parents' band, they had a top 10 hit, no? In the UK. That is correct. Back in the Speaker 3 (11:32) day. They had a top 10 hit here in 1965. It seems like a... lifetime ago, which it was, with a Beatles song, and they actually recorded it with the Beacons. That's their claim to fame. There's no other band that actually got in the studio with John Paul and George. Ringo wasn't there. No, that's very... And Speaker 1 (11:50) actually Speaker 3 (11:50) recorded a song that was a top 10 hit in the States. Speaker 1 (11:52) That's very cool. Not everybody can say that. Okay, Matt, back to you. We're going back to 2023. You start your first day of work as CEO of Stitch Fix. company is in a pretty significant decline. Help us understand what were those first few months like? What did it feel like? What did you see? And what were your first sort of moves as CEO in those first few months? So I Speaker 2 (12:27) was so excited about the opportunity to join Stitch Fix. It was a business that I had observed from afar with a tremendous amount of respect, a tremendous amount of intellectual curiosity. My career in many ways had been in the pursuit of the confluence of retail and technology and then how we can use innovation to better serve clients. And at the core, that's the mission of Stitch Fix. And the opportunity to join the team and to lead the company was very exciting. The founder, Katrina Lake, again, you know, someone that was very inspiring in terms of, you know, what she had accomplished, what she had built, and the confidence and the trust that she placed in me to realize, fully realize that original mission and vision. of the company was not something I took for granted. And when I joined the company, one of the things that jumped out to me right away was just how smart and how passionate the team was. This was a brilliant group of folks that really did believe in the mission of the business and were very passionate about finding how to unlock that. Speaker 2 (13:54) The first thing I had to do was to learn as much as I could about the business where it was and learn as much as I could about the customer. I actually created a customer focus group when I was a candidate to get an even better sense. And on day one as CEO, I met with the team and we started to stand up in person client focus groups around the country that really helped shape my understanding of the opportunity and where the business was. Speaker 2 (14:24) And it became really clear to me that we just had tremendous assets. And if we put the right system in place, we would be able to unlock those. And those insights were that we knew more about each customer before their very first transaction than any other retailer eventually knows over the lifetime of their relationship. And that information, that data, is the holy grail for a retailer. And then our ability to both personalize the experience one-to-one to each client and to layer on the empathy, the nuance, and the expertise of a human stylist becomes a level of service that's unparalleled. You can't get that anywhere else. But we also had work to do across the board, and that was both structural and cultural. Speaker 2 (15:15) From a cultural perspective, something that's always stuck with me that