JCPenney overhauls marketing, promo strategy
JCPenney is getting a new logo and is completely revamping its pricing, branding, promotions, as well as refreshing its stores, the retailer's new CEO Ron Johnson announced Jan. 25.
A new logo is a part of the plan, and a direct mail catalog that will be mailed to "millions" of Americans, the company said in a statement.The company said in 2010 it would discontinue mailing catalogs.
Ellen DeGeneres is also now JCPenney's brand partner.
Johnson also introduced a new pricing structure for JCPenney store merchandise. Instead of hundreds of sales throughout the year, the company plans to permanently mark down all of its merchandise by at least 40% and streamline all offers under a three-tiered strategy.
Launching Feb. 1, these three tiers will consist of “every day” low prices, “monthly value” offers on specific merchandise and “best price” clearance deals on the first and third Fridays of each month, which happen to be the days on which many shoppers get paychecks.
Johnson, formerly the retail chief at Apple, stressed that simplicity is crucial for attracting customers and building their trust, describing his surprise upon realizing how often JCPenney was sending out email alerts.
“I saw weekly events, I saw weekend-only events, daily only events, in-store events, online only, department specific,” said Johnson. “As a customer, you've got to be wondering what the right time to buy is – it's pretty confusing.”
Jharonne Martis-Olivo, a retail analyst for Thomson Reuters, compared JCPenney's poor sales performance in 2011 to Macy's, which was much more limited in its discounts and offers, but posted a much stronger same-store sales average.
“We've seen a very different consumer during the recession and now post-recession,” Martis-Olivo said. “Those spending at department stores are being attracted by limited promotions.”