Target is bringing in an outsider as its CEO for the first time as the retailer fights to redefine itself to American shoppers.
Mulligan had stepped into the temporary post after former CEO Gregg Steinhafel resigned following a large data breach in the runup to the holiday shopping season.
Steinhafel had been dealing with problems on a number of other fronts too, including perceptions that Target is pricier than its rivals and concerns the company lost its touch for trendier offerings.
Target (TGT) shares finished at $61.38 per share on Wednesday, but declined to $60.64 as of Thursday mid-morning. Target shares have fallen 3 percent since the start of the 2014.
PepsiCo Inc., which is based in Purchase, New York, said in a statement it expects to announce Cornell's successor soon.
Besides it's internal problems, Target faces an uneven economic recovery that has pressured the entire retail industry. In particular, the lower-income customers that discounters go after are still dealing with slow wage and job growth. That has hurtTarget as rival Wal-Mart Stores Inc. has pushed lower prices even more aggressively to go after penny-pinching customers.
For its latest fiscal year, Target reported its first annual profit decline in five years.
On Thursday, Target said Cornell's top priorities will be to ramp up its performance and help it evolve into a retailer that seamlessly incorporates online and brick-and-mortar experiences for its shoppers.
Target is looking to start anew after announcing in December a data breach in which hackers stole millions of customers' credit- and debit-card records. The theft badly damaged the chain's reputation and profits and spawned dozens of legal actions that could prove costly. Target's response since the theft has included free credit monitoring for affected customers and an overhaul of security systems.
The company's expansion into Canada, its first foray outside the US, has also been a disappointment. Analysts have said thatTarget botched its Canadian expansion by moving too aggressively. The company opened about 120 stores in the latest year and lost nearly $1 billion in the Canadian business.
In May, it fired the president of its Canadian operations, Tony Fisher, and replaced him with Mark Schindele, a company veteran.
Target must also work to restore faith among its investors. In June at its annual shareholders meeting, the final shareholder vote tally showed a rise in dissent against key board members. All 10 nominees were elected to the board but the rise in votes against several directors shows how uneasy investors remain following the data breach.
Cornell is set to become Target's CEO on Aug. 12.
In an interview posted on Target's corporate blog, Cornell said he has a "deep respect for the challenging retail environment" and noted his ties to Minnesota as a board member for Polaris Industries, a company based in Medina.
"I'm already shopping for a new warm coat for next winter," Cornell is quoted as saying.