CEO Ron Johnson rolled out a new plan for JCP that includes:
- Updating its stores
- Focusing on brands that ‘can’t be found elsewhere’
- Reducing it’s prices by 40% or more on all merchandise
These are bold moves, will they succeed?
The simple answer is a resounding “Yes!” Here’s why:
First, Mr. Johnson’s plan involves rebranding the store to meet its customers’ expectations. This isn’t just a price ploy. Both the stores themselves and the brands they carry will create a clearer brand image and distinguish JCP from other retailers.
Second, JCPenney is going to stop the madness of offering frequent ‘discounts’ to get buyers in the doors. We can but imagine the millions, if not hundreds of millions of dollars, spent designing, printing, mailing and tracking the various ‘sales’ that JCP used to train their customers to focus on price. Under the new plan, the price is intended to reflect the value that customers perceive.
Third, JCP will be simplifying their customers lives. When the need arises, customers will simply stop by the store and pick it up instead of waiting for the inevitable sale. This new strategy also allows customers to ascertain quickly whether or not an item they’re considering is worth the price. Customers will feel that it’s easier to make an informed decision about value.
Finally, the dissatisfaction, that customers experience from having missed a ‘sale’ or having bought too early only to find greater discounts later, go away. In a world as complex as the one in which we live today, I can’t help but think that JCP will be rewarded for making our lives easier.
Kudos to Mr. Johnson and his team for a well-reasoned approach to retailing. It’s one that I hope more retailers, indeed more businesses, adopt.