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JC Penney and the Word

Sale. The word is sale.

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.

This post is contributed by a community member. The views expressed in this blog are those of the author and do not necessarily reflect those of Patch Media Corporation. Everyone is welcome to submit a post to Patch. If you'd like to post a blog, go here to get started.

Fran B June 19, 2012 at 03:12 PM
The problem with JC Penney is not their current pricing model - although I dislike that the best prices are offered on a Friday - who has time to shop on a Friday? 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.
Lauren B. Lev June 19, 2012 at 03:53 PM
Interestingly the fashion (and hard goods) brands have broadened to meet customer demand yet I can't speak to the selection -- perhaps it's still too diffcult to commit to a broad diverse inventory in tough times. 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.
Maddie's momma June 20, 2012 at 04:01 AM
I've been a long time JCP customer and I DO NOT like the new sales model, except maybe the abbreviated name. I can't comprehend the new "color-coded" pricing system, it seems as if inventory is at a minimum (the Massapequa store looks like its going out of business), and I know I got much better prices before. Lastly, I really miss my birthday coupon and those $10 off passes. :( :( Not a good move in my opinion. Innovative -- maybe, consumer friendly -- not at all.
Lauren B. Lev June 20, 2012 at 03:18 PM
As previously mentioned, some reports seem to suggest that they didn't do much market research with their customers/prospects before they launched into this aggressive new effort and they are paying for that decision now. JCP will maintain that the "original prices" are far more competitive (ie. lower) now that they were before, but the markdowns were so dramatic previously that JCP just couldn't continue doing business the way they were.
Helen June 20, 2012 at 06:06 PM
The word "sale" is a magnet for shoppers - as is "bogo", etc. Shoppers get excited when those words are used - as coupons and "come back cash" or 'store bucks' - whatever. Enticing the customer is a huge deal - and there is something about those colored clearance tickets that tickle an individual - as are the "additional 30/40/50 percent" side kicks on racks..... 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.....
Jennifer June 20, 2012 at 07:35 PM
the problem is JCP clients are coupon people. they are not a boutique model or high end business. JCP is great for a bargain or when your in a bind - they only have a slight upper hand over Sears (when it comes to clothing) and most young/spenders rather walk into a Target then JCP. SO that leaves a demographic of coupon savvy individuals and taking that away really wasn't the most researched marketing plan ever. I do however applaud them on their new advertising, brochures and overall look since its pushing them to not look like the store grandma shops in.
Lauren B. Lev June 20, 2012 at 07:59 PM
I believe JCP had no choice in updating their image and fashion perspective -- the inexpensive clothing stores like H&M and Forever 21 and certainly Target (even Kohl's) are pushing their style on one end of the spectrum and Nordstrom et.al. are on the other end. Anytime you have a middle of the road (Macy's, Sears, JCP) it's likely that your products are the first to be sacrificed for value or luxury purchases.
Lauren B. Lev June 21, 2012 at 01:02 AM
Understandably, the advertising is very similar to Target (Ron Johnson was not only formerly with Apple but Target too). Ironically, Target's communications will now be changing since they recently severed their relationship with the agency that created all the well-known ads. As for the coupon orientation, even value-added retailers like Target aren't using the kind of intensive couponing we've witness with JCP-- I'm guessing there won't be many retailers left -- perhaps Kohl's and Macy's -- that will keep the coupon-savvy coming out for more.
Laura June 22, 2012 at 09:09 PM
What I don't get is the policy of offering "best prices" the first and third Friday of every month. Wouldn't you feel like you were getting ripped off every other day of the month?
Lauren B. Lev June 23, 2012 at 05:34 PM
That's part of the confusion because there's three tiers to the prices -- including the equivalent of an every day low price. 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.
Port North Resident June 24, 2012 at 08:51 PM
I haven't shopped penney's in years, I always found as others said their merchandise to be lacking and boring. When I go into a store I either want first rate service which is what I pay for at Saks and Nordstroms (by the way during these retailers sales which only happen a couple of times a year, prices for first quality merchandise is amazing) or I want a phenomenal deal, I just feel that JC Penny over the last decade has provided neither of what I look for. I don't think their prices are all that great compared to what they are selling compared to Lord and Taylor with one of their weekly 20% off coupons. 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.
Lauren B. Lev June 25, 2012 at 10:26 PM
Personally, the store has been exceptional for basics: a suit, pair of slacks, little black dress. But I can appreciate that the fashion merchandise is key, and ironically there are reports that they are doing a great deal to liven up this area -- see this link: http://fashionista.com/2012/04/jcpenneys-latest-fashion-collab-a-lingerie-line-with-cosmo/ 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.
Helen June 26, 2012 at 12:20 AM
Jcp's "fair and square" pricing logic is like figuring out the square root of sale pricing. If you need to have their pricing explained to you or perhaps take a cheat sheet at the mall doors, something wrong. 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.....
Lorraine DeVita June 26, 2012 at 01:35 AM
As anyone who knows me will tell you I never EVER pay retail! I had been a rabid jcp shopper for years. JCP had been my go to store on line for furniture and household goods. During this phase of finding themselves or their niche I have noticed a dramatic drop in selection and quality. Where i would pounce once a month to look for a fantastic Bargain(last yr I SCORED three stunning outdoor chandeliers for $75.00 a piece the same ones in Frontgate were $400.00 ! , I have scored some major finds over the years.@ JCP but they took the FUN out of my online guilty pleasure of bargain hunting.. The other problem i had and STILL have with JCP is the disparity in pricing between their online products and their in store products, the difference could at times be almost double the price in store even with the shipping. Other retailers dont do that and while i appreciate the brick and mortar overhead vs online retail the cost difference was too extreme driving more people away.. I want my OLD jcpenney back! The thrill of the hunt is GONE...
Patrick June 26, 2012 at 02:30 AM
@Lorraine, can you please elaborate on how you never, ever pay retail? Can you let everyone where you buy your milk, and your eggs, etc. at a discounted price, we would all like to know, everyone needs a bargain. You purchased 3 outdoor chandeliers @$75 a piece, advertised at $400 each elsewhere, that is a great deal,please tell everyone how you came about such a stellar savings. I was not aware that JCP almost doubles the price of some of thier product instore as opposed to their online store, can you please give some of the most recent examples of this pricing disparity, as I am sure that the readers of the Patch would almost certainly be most appreciative of the knowledge you have of the products that are potentially marked up 100% in store as opposed to the online store. You say other retailers don't do that, which other retailers do you speak of. and please detail the mark up disparities for in store merch. as opposed to online merch for the other retailers of which you speak. Every reader of this blog would certainly love to know which retailers keep their in store pricing in line with their online pricing. Can you please provide the research data used to formulate the intuitive information that you have posted here so that we all can find the best deals on product available in the furniture and household goods arena. Thank you
Lauren B. Lev June 26, 2012 at 01:53 PM
Not only have they lost consumer confidence but I've read some marketing commentary with experts who wonder why they didn't use some of their ad dollars to simply explain the pricing rather than only relying on full-fledged image campaign.
Helen June 27, 2012 at 12:06 AM
@Lauren beneath this reply - guess they didn't hire the right marketing team - problem is with the corps and big wig marketing/ad agencies, they have lost touch with real people- what the people want and how/what they understand. Great, so I got that JCP is all about 'fair and square' with the 'square' visual - but beyond that - I just don't get it and I just don't care - too many other places to shop.
paul June 27, 2012 at 11:46 PM
http://money.msn.com/top-stocks/post.aspx?post=e427a496-b04c-413a-a3af-fbd1e8366580

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