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Update: JCPenney’s New Era, Phase 1

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Last week I wrote about my take on Ron Johnson’s new strategy for JCPenney. I wrote the article over the weekend and it published on Tuesday, January 31. JCP’s new strategy, Phase 1 went into effect the very next day. So naturally, I was at the mall on Wednesday, checking to see how much of Mr. Johnson’s strategy got executed in stores – specifically, my closest JCPenney store at Park Meadows Mall in Littleton, CO.

It was a really good time to take a look, as I had actually been in this same store only a few weeks ago, on my shopping expedition for pants – specifically, the $50 pants mentioned in last week’s article. So I had a direct, and recent, comparison. Here’s what I observed, following the 3 P’s that Johnson described as his target for Phase 1:

Pricing

Every article in the store really was repriced. And repriced at something reasonable. Boys’ jeans for $15, women’s shirts for $18. In some cases you could still see the clearance price and in most of those cases the new price was at or slightly below the old marked price. I don’t know when they started repricing everything, but to strive to have every store repriced by a certain deadline – and not just a bunch of stuff moved around to clearance racks, but literally the entire store top to bottom – is very impressive. I found all of 3 items that were missed in the pricing re-do while I was wandering the store.

Presentation

An enormous amount of merchandise has magically disappeared. The women’s career section alone was almost decimated – and this one really struck home given the pants shopping I had done earlier in January. In its place, a taste of what is to come. A display of 3 mannequins, done runway style, each in a different look. Three racks on either side, and a lot more merchandise up on the walls. It looked spacious – almost like something you’d expect to find in a high-end department store like Saks or Neiman Marcus.

The merchandise? Well, I couldn’t find the pants I had bought three weeks ago, which was kind of a shame as I might have purchased another pair. And outside of some of the specialty shops – MNG by Mango and the like – the merchandise is definitely not high-end merchandise. More on the side of IKEA or Target than Macy’s. But the display was so refreshing after so many years of shopping areas crammed with racks. In fact, it was my biggest complaint about JCP when they got kudos for their last so-called turn-around effort. At the time, I didn’t know what everyone was raving about. You couldn’t get a stroller through the main aisles, let alone into the shopping areas of the store, it was that crammed with merchandise. Unshoppable. If the Worthington display in the women’s section is any hint at what is to come, then when they’re done transforming this store it will be unrecognizable as a JCP of old, and that is totally a good thing.

Personality

You’ve probably seen the ads by now – first the ones that screamed “No! ” and then the ones that advertised their new customer service policies. I’ve seen two of the latter in the wild – the one on returns policies, and one on Fair and Square pricing, both ads that were debuted at the analyst event last month. They’re quirky. They’re almost a little too subtle – I’ve had to explain to friends that the woman in the store is screaming because the sign said something about a great sale “Yesterday ” and the woman at the glass window is screaming because the exact same jacket she is wearing is now 62% off. My husband thought the ad about the returns policy was a Target ad because he had missed the logo at the beginning. Not a real coincidence there, given Mr. Johnson’s heritage.

In-store, execution was good. The store was indeed done over in the color palette of the month – in February’s case it’s pink. And there were feature points in the store that drove home the theme. But even with some of the merchandise changes, it felt like the store was wearing an ill-fitting suit. It felt like a veneer, not a change that was bone-deep. I don’t intend that as a criticism – there’s only so much you can pull off in effectively a few months and I think JCP has focused on the right things first. Besides, they may have had the designs all done way sooner than now, but let’s face it, the company had to make it through the holiday season first.

So ultimately, I think it’s going to take at least a few months for JCP’s new personality to sink in. My in-store purchases were presented to me in a new shopping bag – it was done up in the February imagery. So it looks like they intend to switch out the bag every month, in keeping with the new timing strategy of monthly programs. Let’s see how well that gets enforced in stores. I know from personal experience that there are going to be store associates who will still be handing out February bags well into March if there are any laying around because of the well-intentioned desire not to be wasteful. Heart’s in the right place – it’s just not going to be in tune with the still-nascent strategy.

That Last Pesky P: People

This takes me to the P that Ron Johnson forgot, and that’s People. I didn’t expect a miraculous transformation of the staff – they were probably all sleepy from staying late to reprice the last few things that needed to be repriced the night before. But no one stopped to ask me if I needed help or a dressing room. In several sections of the store it was the same old sorry department store story – empty departments, no one to be found even if I did actually have a question. On the main floor in the women’s section, there were three people behind the cash register pod near one of the exits and they were all busy enough helping customers, but there was no real line to speak of. Did all three need to be there? I kind of felt like they were hiding from customers back there. Oh, they were positive enough about the changes – “Aren’t the new prices great? ” and “Doesn’t the store look really good? ” – but there was no positive vibe hanging around them. Apple-like employees they are not.

So my take on the experience? Thumbs up. Right now, the store is a plane barreling down a runway. The plane is shuddering as it picks up speed and things are rattling around that kind of make passengers nervous. But there is definitely a sense of forward progress. Will the plane gain enough speed to successfully take off? Mr. Johnson has, in my opinion, at least bought himself until the next holiday season as a runway. And if you give no other credit, you at least have to give him credit for that.

Newsletter Articles February 7, 2012
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