J.C. Penney shares sank nearly 10% this morning, after the department-store chain, in the midst of a controversial turnaround, posted a larger-than-expected quarterly loss. J.C. Penney swung to a $203 million, 93 cents a share, loss, from a $186 million, 71 cents a share, profit a year earlier. Excluding one-time items, J.C. Penney lost 56 cents a share. This greatly exceeded analysts’ prediction of 19 cents a share. Same-store sales fell 26.1%, suggesting that J.C. Penney’s struggles to attract customers continue. This is a key metric for retailers because it strips away volatile results from newly opened or closed stores.
Comments: How to wreck a once-thriving company? See JC Penney.
The new managers of JCP seems to have considered the customer base to be too old, too white, too conservative - so they decided to reach out to gays and minorities. The same-sex Mother's and Father's day ads created a lot of controversy - with non-customers liking the ads - and existing customer seemingly not. And the anticipated hoards of Hispanic and black shoppers failed to show up.
Sounds like the Republican elite are planning to hire the equivalent of the JCP management to give the GOP a similar makeover. It would have a similar outcome.
Oh where to begin--those of us who live in rural areas don't have a lot of shopping choices, but JCP was traditionally place with a little bit of everything, not great but decent quality. It also was a place the middle-aged and old folks like to shop. Now the fashion is totally geared toward very young people, so cross them out for clothes shopping. Ditto on shoe dept. They still have nice home stuff, but a very small selection in the store. This is true in store after store that is in the rural areas--Kohl's is another one. Same trend exactly...except young people don't shop at these stores that much--there's stores galore in every mall in the country with even more selection for them. So...nobody shops there anymore. End of story. Don't need an MBA to figure this one out.
There's a simple answer. J.C. Penny's prices are too high by about 30%. You can buy a high quality T-shirt (fine thread, tightly woven, well dyed) at Costco for $11. Anything close at JCP will cost you $16.
Reply 7 - Posted by:
mary Ellen, 11/9/2012 10:02:12 AM (No. 9002194)
Two weeks ago I visited a JCP furniture store. It was drab, gray, with unattractive furniture and accessories. It was empty of customers and I could have rolled a bowling ball down the isle. This past Sunday I visited again and it was bright, new furniture and accessores, and several customers. I don't know what brought about the change except it looked good. I expect that it is too little, too late, because the great ego of CEO Johnson doesn't advertise or promote coupons or sales. I've never been a big shopper at Penneys and probably will never go back although I feel terrible for the people working there. They don't stand a chance with Johnson at the helm.
I used to live in a town where Penneys was the only department store.
Now I live where (within easy driving distance) there are two Nordstroms, five Macys, a Sears, three Targets, a WalMart, and specialty stores of all kinds too numerous to mention. The competition - especially in a bad economy - is staggering. (And I didn't even mention the stores like Marshalls (2), Ross (2), Nordstrom Rack (1), all in the same easy driving area.)
This is not rocket science. See what happens boys and girls when you go from the late James Cash Penney, Jr.'s "Golden Rule" business philosophy to the smiling face of Ellen DeGeneres on your advertising?
The last time I was in Penneys I walked though it to get to the main part of the Mall so I could get a pretzel. I tend to shop at Wal-Mart and smaller specialty shops. And, no, I'm not really into the finest in hip-hop fashions. Mrs. Cow
Here's my view from the 'other' side. I've worked at JCP for 3 years.Some of the changes are good. Everyday low prices rather than constantly fluctuating prices is good. There are coupons for people who spend enough with their JCP credit card each month. I work there because my schedule gives me the time I need for my direct sales business. I make it my personal policy to give excellent customer service. I've learned not to be emotionally attached to the place. I've signed an agreement of confidentiality but there are stories that could curl your toenails.
Got an ad for JCP (who are they?) inserted into the paper this morning. Didn't see a thing that interested me so straight to the recycle bin. I usually don't even bother looking before it hits the recycle bin. This time of year I always remember the Sears and Penney's Christmas catalogs that we dreamed over as kids. Sorry to see both stores go away - and I think that's what is going to happen to them.
All the above reasons are right on the money, but I think all retailers and most charities also are going to take BIG hits now. Libs do not donate their own money and conservatives are trying to hang on to what we have.
Unfortunately I worked for Penney's while in High School...in retrospect it was a dismal work environment. Penney's took advantage of women, made them work 39 hours and fired anyone that clocked 40...it was to keep from having full time benefits for them. I was the Al Bundy dude, the shoe department. Their selections were not good and selling a pair of shoes became a reason to celebrate. Back then I made a huge $1.25/hr, but gas was as low as 15 cents/gallon so it wasn't so bad.
Back to Penneys, I always wondered how they survived, whenever I walk into one I feel a depression coming on...not because I worked there but simply because...
Penney's quality was down, so I only walked through the store to get to the mall. Then they jumped on Limbaugh for his take on Ms Fluke and I crossed them off my list completely. They came the new advertising campaign with ridiculous ads stuffed in the mailbox and I wondered if anyone in the ad dept ever went into a Penney's.
I used to buy everything at Penney's. Then came those stupid mailers; the layout of these mailers was horrid; I would never buy anything from a catalog advertisement that looked so dumb. The stores are awful now. I will not shop J C Penneys again.
Our local JCP went hispanic. Loud clothes, low quality. Same with Belk. My wife used to shop there. Cancelled her JCP card and doesn't go anymore. It wasn't political. They just lost their older customers. Maybe they don't think we have any money. Mrs. Holliday says that they don't have anything left for the 'mature' lady.
I was unaware of the DeGeneres/Fluke/Limbaugh controvery and that JCP had bought into bashing Rush.
The JCP CEO ran the Apple retail stores. Apple forces all its distributors to sell its products at the same price, regardless. This means you go into BestBuy to look at an iPad, and you find he's not as savvy with the product as the guy in the Apple store. Guess where you'll buy the iPad? In other words, the Apple stores have a guaranteed success factor built in. They have no real competition in sales, so this guy became successful... whoopdedoo.
Fast forward to JCP. They have massive competition in the retail clothing sector, and had a loyal customer base. They're now trying to become the "Apple" of retail clothing, but won't be able to, because Gap, Old Navy, etc. beat them to the punch. His approach, which he thinks is "revolutionary," is actually old hat now. I know people who work for JCP, and know their very expensive "new concept" stores are going to be "interesting", but I fear this company is doomed to go the way of K-Mart.
By the way, this household is very pleased to shop at Kohls and WalMart for our clothing, and won't go into our local JCP due to their embrace of the gender confused. Kohl's gives fantastic discounts that are incredible. We recently bought a Krups coffee maker for about $30, once all the coupons were applied.
I forgot all about Penney's when Kohls opened up in my neighborhood. They offer great discounts, lots of coupons, and about the same quality as Penney's. I don't know anyone who shops at the malls anymore -- everyone I know is buying their clothing and other items at Kohl's.
I haven't walked in to a Penneys or Sears since they decided to take the PC side of Sandra ''I need $3,000 worth of birth control a year, but I'm not a slut'' Fluke over Rush Limbaugh, and dropped their advertising from his show.
How did that work out for you there Penneys???
I guess the lie-berals and sluts you thought you were going to impress just didn't make up for the lost revenues from mom's and other conservative and sensible people who you made just a tad angry with your stupid decision.
If that didn't kill you, a couple more years of NØbamanomics should just about kill what is left of you. You won't be missed...
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