Since 1902 Americans have relied on – and loved – JC Penny. They shop there for clothes, furniture, shoes, towels and appliances. Their key to success is a wide range of high quality products at fair prices – as well as the JC Penny catalog and easy credit. The catalog is largely obsolete now that we have the internet, but historically the JCP catalog has been a very important revenue stream for the company.
Normally I don’t pay attention to this kind of thing, but it seems like JC Penny has been in the news a lot lately. I began to notice even more news about JC Penny when the religious hate group One Million Moms spoke out in opposition of Ellen DeGeneres as the spokesperson for JCP.
The more I heard about JCP in the news, the more I began to pay attention. I am especially interested in the company now that Ron Johnson is the CEO. I personally worked under Johnson at Apple and I think his policies and decisions are the primary reason that Apple (particularly Apple Retail) is so successful today. Further, I have loved Ellen DeGeneres since I was a child and have found her commercials to be hilarious.
Under Ron Johnson, the company has completely restructured how it does business. Whereas they previously relied on frequent sales, cents-off coupons, marking up to mark down and lots of advertising – they have shifted to a more Apple-like approach of having everyday low prices with twice monthly sales. Initially the new approach seemed to confuse consumers who perceived less value without coupons, but the PR campaign put together by Ellen DeGeneres seems to have largely been effective in educating the public about the new strategy.
From January to February, the value of JCP’s stock rose almost 23% as a result of the new strategy and Ellen DeGeneres as the spokesperson. It has declined a bit since then, but overall it is doing better now than it was doing in January. If anything, the controversy caused by One Million Moms helped JCP by providing LOTS of free publicity for the company. Americans in general seemed very pleased that JCP stood behind Ellen DeGeneres, despite the controversy.
I believe the new pricing strategy, hiring Ron Johnson as CEO and bringing on Ellen DeGeneres as spokeswoman are all very good moves by JCP. In fact, I am so confident that I bought some of their stock yesterday. I am excited to see where the company goes from here.