Johnson Unveils New J.C. Penney
NEW YORK-J.C. Penney's new top leadership, CEO Ron Johnson, along with President Michael Francis, unveiled a complete overhaul of the department-store company's pricing, promotion, brand image and presentation at a meeting with the investment community here this morning.
The components of J.C. Penney's whole new look will begin rolling out on Feb. 1. Mentioning that this year is J.C. Penney's 110th anniversary, Johnson said, "We're fine with growing old, but we're not fine with growing stale. We want to be young and vibrant again."
Johnson told the audience that the company will reduce its multiple promotions to a pricing strategy called Fair and Square, which sets three types of prices: Everyday, which offers consistent pricing for each day; Month-Long Values, which gives shoppers low prices on products they need to buy in that particular month; and Best Price, which offers customers the lowest prices on products on the first and third Fridays of each month. The new promotion strategy, which ties into the pricing, aims to reduce the number of promotions J.C. Penney offers from a whopping 590 in 2011 to 12, one for each month of the year, with each month's promotion focused on products customers are likely to buy in that month (back to school in August, holiday merchandise in November and December, for example).
Regarding its brand image, Francis said J.C. Penney is refreshing and "contemporizing" its brand with a new logo (a small jcp in a blue box surrounded by a red frame) and a strategy to center the brand around "honesty, simplicity and inspiring the customer," he said. It also will give the opportunity to present J.C. Penney as "distinctly American," Francis said. He displayed advertising using cover images from the Saturday Evening Post and announced a partnership with TV host Ellen DeGeneres, who will be featured in J.C. Penney ads (five of which have been shot) and who will talk about the store on her talk show. DeGeneres appeared on a video during the presentation.
In terms of presentation, Johnson said J.C. Penney will transform its stores' layout over the next three years to one focused on shops. By 2015, he said, there will be 100 shops in each J.C. Penney store. The format will feature Town Square, a central area in which services and other yet-to-be-determined offerings will be provided, surrounded by Main Street, where the shops will be located. The new prototype will be introduced in 2014, and all of the stores will be reconfigured to the new format by the following year.
The meeting included a brief speech by Martha Stewart, whose J.C. Penney shops are slated to launch next year. Terming herself an admirer of both Johnson and Francis, Stewart said their work "will change the way we shop" and that the Martha Stewart brand "will fit tidily into J.C. Penney."