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A 'Fresh' Start for JC Penney?
By: Heather Ewert
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JC Penney has not enjoyed much praise in the news lately. It seems like everywhere you look, you can find yet another article about the store suffering the next blow in a series of setbacks. Just recently, news emerged that they laid off over 2000 workers, and in late February, they announced a loss of $552 million during the last quarter. This was, in a large part, due to the overhaul of the pricing structure that had made the store so popular in the first place. Formerly, JCP had strategic sales and coupons that brought many loyal customers back through the doors year after year. Then, in an effort to garner more interest in the brand, they tried something new: taking away the coupons and implementing low prices across the board.

Ron Johnson, the marketing strategist behind this new ‘no-coupon’ pricing plan, started taking major flak from news sources, being blamed for “ruining” the company just one year after taking the helm. And, with the staggering amounts of value that JCP was losing, people actually began to agree with the angry sentiments being expressed.

But now it seems Johnson has a new plan — one that hinges on yet another big change to the store’s layout and brand presentation.

Last Friday, JCP announced that they were opening 681 Joe Fresh Stores within the retail stores themselves. Joe Fresh offers affordable, trendy men’s and women’s clothes that have been a big hit across stores in Canada but remain largely unknown in the United States. The Joe Fresh stores launched online during the Oscars, and perhaps somewhat surprisingly, they became JCP’s most popular clothing brand within just a few days. So does this spell success for Johnson and JC Penney? Well, maybe, and maybe not.

Whether or not Joe Fresh keeps customers interested in shopping with JC Penney is of short-term concern — longer-term projections are more focused on how the brand will recover, as well as how it will be perceived after being marred so badly. Many brand analysts had likened Johnson’s catastrophic pricing change to the Coke snafu in 1985, when they changed the classic formula. En masse, customers rebelled against Coke, forcing them to reverse their decision quickly. So should Johnson have reversed the pricing change? Or is a store-within-the-store like Joe Fresh a bright spot on JCP’s horizon? After all, Sephora and about a dozen other stores have enjoyed success since their inclusion in JC Penney’s retail space, and it is still possible to draw in new customers online.

This leaves me wondering: Is Joe Fresh a boon to JC Penney at such a critical time? Or will it merely be an additional change that reflects a formerly successful brand’s struggle before it ultimately collapses?


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About the Author
Heather Ewert is a content writer for an internet marketing company. She enjoys creative writing as well and blogs in her personal time at http://infernoofcool.wordpress.com/. She lives in sunny Southern California with her boyfriend, Snowshoe kitty, and her collection of Warcraft novels.
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