Sunday, May 6, 2012

JC Penny: What's wrong with this picture?

Ron Johnson, former Vice President of Retail Operations at Apple and current JCPenny CEO, has been making big changes for the ailing retailer lately. But will they actually help??

Overview of changes and my thoughts:
1. Ellen DeGeneres.

I love Ellen. I think the viewership of her daytime show will respond to her ads and are the type of consumers interseted in JCPenny. However, what about the rest of the JCPenny customers? Will they be alienated by someone they can't relate to? Think about it: Ellen is a millionaire TV show host with no children and married to another woman. I would venture to guess that JCPenny's core customer is a mother who is trying to outfit her family and home without the busting the bank.

2. Prices no longer end in 99. Like this commercial:

Let me point out that there is a reason most prices end in 99. When a consumer see $14.99 they tend to drop the .99 part and round down. It's not rational since 15 is a much closer number to 14.99 than 14, but that's what happens. Retailers know this so they use it. Not because they are trying to dupe the customer, but because it helps them remain competitive.

3.  No coupons

How Wal-Mart of them! Does this mean they're offering everyday low prices? (I think that's probably trademarked, so they won't come right out and say it.)

I am confused how JCPenny is going to sell more clothes. They certainly are offering less of a hassle, but that's about it. There hasn't been any mention of their products in any of the ads. They are differentiating themselves on service during the sale instead of on products.

What they really need to be doing is changing their product mix and condensing their offerings. They also need to find their target market and appeal to them to the max. If it's busy moms then have busy moms in your ad and show them how JCPenny is going to make their lives easier.