“Fresh Air” era begins at JCP
NEW YORK— The transformation of JCPenney into America’ favorite store will begin with dramatically simplified pricing strategy and promotional cadence supplemented by an improved product presentation that will allow the 110-year-old company to regain its personality with a new generation of shoppers, according to CEO Ron Johnson.
Johnson presided over an unconventional two-hour investor and media event Tuesday morning at New York’s Pier 57 that was attended by an estimated 700 people. The choice of location, a dumpy waterfront warehouse, was symbolic in that the space was transformed to a bright and airy venue. Attendees were led down a long white hallway with images of the retailers print promotions from the past year into a meeting room with large pale blue screens onto which were projected images of clouds while new age jazz played in the background.
Johnson proved to be quite a showman as he took the stage and offered a compelling recap of how department stores slid from dominance in the 1960’s to where JCP is at today, which is basically a sea of sameness, with no price integrity and an emphasis on private brands that make it seem at times as if apparel is being sold by the pound.
Johnson is out to change perceptions and attitudes about JCP, and the path to becoming America’s favorite store will begin with a dramatically simplified pricing strategy and an equally dramatic reduction in promotions.
Fair and square is how Johnson described the new approach to pricing. The company knows that shoppers don’t begin to make purchases until goods are marked down 40% so that is where going forward pricing will begin. No games, just everyday fair values designed to regain trust with shoppers.
The same philosophy is being applied to promotional efforts where JCP is shifting from a highly promotional strategy in 2011 that saw the company invest $1 billion to promote 590 unique events to 12 monthly events each of which will receive $80 million in marketing support and include a 96-page direct mail piece with a heightened editorial emphasis.
“This new pricing approach and promotional cadence will allow us to change our personality,” said JCP president Michael Francis, the former chief marketing office at Target that joined JCP shortly after Johnson arrived.
The emphasis on monthly events has other benefits as well, according to Francis, because it simplifies store operations and frees up merchants’s time for assortment planning as opposed to constant pricing changes and determining which items to feature.
Longer term, the key element of transforming JCP into America’s favorite store involves a merchandising overhaul that is dependent on “shops” within the stores. Beginning this August, JCP will begin converting departments within its stores to shops utilizing new five foot by five foot modular fixtures that can be stacked or used to create walls. The shops will come at a pace of about two every months for the next three years until 100 separate shops are in place by December 2015.
NRF welcomes Obama’s emphasis on job creation
WASHINGTON — After President Barack Obama delivered his State of the Union address on Tuesday night, the National Retail Federation issued a response regarding his remarks on job creation.
NRF said it welcomed the President’s emphasis on job creation, saying that it will help restore the nation’s economic state.
"Job creation is our nation’s No. 1 priority, and as the industry that supports one out of every four U.S. jobs, retailers stand ready to do their part in putting Americans back to work," NRF president and CEO Matthew Shay said. "Retailers are helping to rebuild the economy, but Washington must get moving to encourage job growth and remove barriers to job creation."
Although NRF supported the idea of job creation, the association did, however, express caution at the President’s emphasis on manufacturing.
"We welcome the President’s commitment to create jobs in manufacturing, an industry that’s critical to a healthy supply chain," Shay said. "But retail and other service industries support far more jobs than manufacturing, and we need economic policy that supports all industries and doesn’t favor one sector of the economy over another. We hope ‘Made in America’ isn’t code for protectionist trade policies that only drive up prices for American consumers while doing little to create U.S. jobs."
NRF earlier this month sent an open letter to Obama urging him to call for action on a number of initiatives — sales tax fairness legislation, corporate tax reform, and free and open trade initiatives — that support a strong retail sector as part of the State of the Union address.
Nanette Lepore brings teen fashion to JCPenney
PLANO, Texas and NEW YORK — JCPenney announced that it has partnered with fashion designer Nanette Lepore to bring her first teen-focused line to its stores. Inspired by her teenage daughter, the line "l’amour nanette lepore" will be available exclusively at JCPenney and will debut as its own distinct shop beginning February 2013.
"We’re building a merchandise offering that will be unlike anything available in American retailing today," said Michael Francis, president JCPenney. "We will be working with the most influential designers in the business, like Nanette Lepore, to entirely redesign the jcpenney shopping experience around a series of distinctive brand environments. We’re thrilled that Nanette Lepore is one of the first designers to join us. Her style is easily recognizable, highly sought-after and much adored."
Lepore will design and merchandise the brand to reflect her daughter’s inherent super-girly teenage style with just the right amount of feminine sophistication. The brand will launch with a spring collection of fun and flirty dresses as well as casual sportswear and will target the 13- to 19-year-old shopper, according to a press release.
"Because my muse is my amazing daughter Violet, the l’amour nanette lepore brand will embody the energy and vitality of her generation," said Nanette Lepore. "As JCPenney evolves, I can’t think of a better retailer to bring this brand to life. Soon, every young fashionista will have the opportunity to add a little l’amour to her wardrobe."