J.C. Penney Reimagined
By Wanda Jankowski
| A mock-up of what the Liz Clairborne brand shop might look like using newly designed fixture panels as back walls. Brand shops will incorporate all product categories (ex. Liz Claiborne apparel and accessories).
| The new square “frame” jcp logo recalls the American flag. The frame graphic will be used throughout jcpenney’s marketing and in-store displays to remind customers to “frame the things they love.” Each major month-long promotion is referenced by one specific color used in all displays and materials, such as pink for February.
Ron Johnson and Michael Francis reveal the plan for transforming jcpenney into a new kind of American department store
“We’re fine with growing old. We’re not fine with growing stale,” states Ron Johnson, ceo of J.C. Penney Company, Inc. and former architect of the Apple store concept, who is charged with rescuing the department store chain, founded more than 110 years ago by James Cash Penney, from its doldrums. During the “In Praise Of Fresh Air” presentation held on Jan. 25, 2012 in New York and delivered by Johnson and Michael Francis, president, J.C. Penney Company, Inc., the four-year long transformation strategy for jcpenney was revealed.
Here are highlights of the plans for turning jcpenney into “America’s favorite store”:
The Problems: Constant discounting and couponing, and declines in product quality had damaged brand integrity and failed to attract enough shoppers.
The Goals: To make shopping at jcpenney as convenient as possible, to offer the best pricing and to entice customers with an experience they can’t find anywhere else.
Johnson explained how goals are to be achieved by addressing the six “Ps”:
Pricing: Fair and Square Pricing, effective Feb. 1, 2012, includes: Everyday Prices, regular “great” prices; Month-Long Values, better prices on selected timely merchandise for the entire month; and Best Prices, lowest prices offered on the first and third Fridays of each month on merchandise to be moved out.
Personality: Brand modernization begins with the new red, white and blue logo that recalls the American flag. It features a “frame” that will be a repeated element in promotions and in-store graphics.
Promotions: Jcpenney will host only 12 promotional events each year built around the Month-Long Values on items consumers are looking for in that month, as well as goods and services unique to the month. A different color for each month will be used in advertising, signage and displays. TV talk show host and comedienne, Ellen DeGeneres, will be the store’s brand partner, participating in promotional activities.
Place: The store will be reconfigured to include a Main Street of 80 to 100 brand shops and a Town Square core offering services.
Presentation: Beginning in August 2012, two to three brand shops will be installed monthly in each store. The Town Square will debut in 2013. The transformation will be complete by the end of 2015.
A new floor fixture has been designed, replacing standard racks and T-stands. The 5- by 5-foot panel-like fixture can be used singly or in multiples linked together. It can form the walls of shops, hold graphics and offer enough capacity to open up floor space within a shop for multi-dimensional displays.
Product: Merchandise quality will be raised and goods will be “curated.” The store’s current 400 brands will be pared down to 100. Some existing brands will be transformed, others will be dropped and new brands, such as Martha Stewart®, will be added.
Funding: Transformation funding begins with $800 million in capital expenditures in fiscal year 2012. The company’s formula for long-term sustainable growth is to improve sales productivity, generating 40 percent or better gross margins, while lowering expense. The company also is targeting $900 million in expense cuts over the first two years of its transformation from stores, advertising and operations in the company’s home office.