A new one is added to the list of JC Penney mistakes
Tom Dougherty, CEO – Stealing Share
4 March 2013
There was a coherent strategy, but the execution was wrong
It wasn’t long ago that JC Penney CEO Ron Johnson, the former head of Apple’s retail stores, was rumored to be on the verge of being sacked after just a few months on the job. It was too soon to make such a drastic move because that seemed to be another on the list of JC Penney mistakes. Johnson’s strategy needed time to play out.
Well, it’s played out.
“To his credit, Johnson had a coherent strategy in a market where few retailers even try. I mean, what exactly is Sears’ strategic plan?”
Johnson’s concept of “fair and square” pricing, meaning JC Penney would not discount, led to a new logo. More importantly, it was positioned against a retail market that constantly discounts. The CEO was was banking on consumers who believed that a discounted price was the real price, and that they were being gouged when merchandise was not discounted.
Johnson obviously miscalculated when he pinpointed what he thought was an emotional trigger for shoppers. Turns out it wasn’t emotional at all. In fact, a trip to a JCPenney store, as documented by Matthew Yglesias from Slate, demonstrated that the store hasn’t changed much either.
Johnson failed and added his strategy to the list of JC Penney mistakes. His emotional trigger – that other retailers are not honest – was a pricing story, which is rarely emotional. In fact, even an advertising campaign that showed an item being sold for less at JC Penney than in a competing retailer didn’t arouse anger in shoppers. The ad was positively cheery.
The JC Penney brand, therefore, became unimportant and flat.
To his credit, Johnson had a coherent strategy in a market where few retailers even try. I mean, what exactly is Sears’ strategic plan?
Unfortunately for the new CEO, this was the wrong strategy. On top of that, it was poorly executed.
Amazon Go Tom Dougherty, CEO - Stealing Share 23 January 2018 Amazon Go is another threat to the grocery market Well, damn. Amazon completely revolutionized grocery shopping in one fell swoop with Amazon Go. Stories flooding the newswires yesterday told of a bold new...
Volkswagen Brand Repair Tom Dougherty, CEO - Stealing Share 17 January 2018 Where does Volkswagen stand now? Brand repair often represents a daunting task because it means changing a belief system that exists in the market. That you stink. Volkswagen, after...
ALDI Tom Dougherty, CEO - Stealing Share 16 January 2018 ALDI is unique, but is it better? There was a time in my life where consuming food was my enemy, bringing about a battle with diabetes. Since then, I work hard at keeping my food intake at bay. Nonetheless, what...