JC Penney decided a number of months ago that they will no longer involve themselves in the negative downward spiral of supporting promotions and will replace the promotional language with the new phrase “month-long value.”
On paper this looked really smart. Aggressive – and a compliment to the new store interiors and the new flag-like logo. After all, according to Advertising Age, the store was hosting over 590 advertising events a year with hundreds of clearances that resulted in declining revenue even though average retail prices rose.
So the plan to offer lower prices is still on the rack (so to speak) --only it will called “best prices” and continue to be offered twelve times a year – “every first and third Friday, every month”.
Get it? Me neither.
I guess that’s why there is a four-letter word back in JC Penney vocabulary.
Sale.
JC Penney has to break out from being the middle of the road retailer and a middle of the road advertiser. That’s why they went to advertising that made fun of catalogs, direct mail, coupons and deals to make consumers buy. They hired Ron Johnson as their CEO, formerly of Apple Inc. They strengthen up the fight and wrapped themselves as the American Company that wants to be your Company with a capital “C”. Yet there is also indications that ad budgets will decrease in 2013. Just when they are trying to ensure that you and I -- current and potential customers -- understand the price mentality too.
Let's face it, shoppers are all about the deal. But in retail, (possibly without doing their research) JCP has proved if you call it something other than “sale” we shoppers might just be too distracted in our busy lives to care.
The problem is the clothes. JC Penney's goes through periods where the clothes are boring and there isn't a lot of selection. I have shopped JCP my whole adult life. Sometimes there is just nothing of interest. And that seems to be where they are now. There are fewer options available and they're not fun or interesting. They have good brands; the clothes offered cannot be the best of those brands. Plus the store layouts are just bizarre. They look empty.
As for the story layout -- my reference is the Roosevelt Field store and its layout. This new layout is meant to create a "village square" in which all of the departments are separate and open up into the center for checkout. It is very deliberate and has done well - especially developing separate departments like Sephora whose sales per square foot has done incredibly well. And remember -- with a CEO previously from Apple Inc. -- all the clean store layout designs come from his sensibility.
JCP has a more boutique look - which may be defined as cleaner - BUT to the life long shopper - it seems displaced and as though we've been unwillingly transported to the "higher end" stores.... They took shopper comfort away and that's HUGE. Oh, as for inventory - yes, most retailers have finally reduced their inventory - so all clearance selections will not be as great as before.....sigh.....
I found this weblink http://dealnews.com/features/Whats-the-Deal-with-JCPenneys-New-Pricing-Plan-/547780.html which in brief says "... the "Fair and Square" pricing initiative, a three-tiered pricing policy meant to deliver the best prices consistently throughout the year...there will be "Everyday" regular prices, which are reportedly at least 40% off from the get-go; "Month-Long Values," or special promotions on seasonal items that hold for the entire month and are labeled as such on the product page with the month in question; and "Best Prices," or the absolute lowest price that occurs during clearance sales on the first and third Friday of the month to coincide with most salary schedules." I thought I had read previously that the "best prices" stay that way until the products are gone, but I could be wrong. And I wouldn't be surprised if people felt cheated, until they are schooled in the policy -- and even then, if its confusing, no one will stop to work at learning it.
I feel the solution for penny's is to obtain better merchandise first and worry about marketing second, good marketing will get people into the store once service and quality merchandise will keep them coming back.
In short, as noted in the site above, designers like Liz Claiborne, Nicole Miller, the Olsens, Nanette Lepore, Charlotte Ronson, and Mango are all represented at the store for what appears to be a long-term relationship. It's a balancing act between the "traditional JCP shopper" and the "trendy shopper" JCP wants to snag. Insult/annoy one to keep the other is not what they are after. After all, the ideal is to keep all the consumer types friendly.
Penny's, just like Sears, needs to bring in (and has) designer names. You do need to keep the old while bringing in the new - that's fine - but I think they have lost some consumer confidence with the 'failed' square pricing thing-a-ma-jig.....