Jeff Minkin: Adjusted Sales Strategy May Help J. C. Penney
Online, July 23, 2012 (Newswire.com) - While "everyday-low prices" may be a model that works for major retail chains like Wal-Mart, Inc., the idea is not proving as successful for clothing retail giant, J.C. Penney. According to a recent article from The Wall Street Journal, the company has made major shifts in the past year to move away from its periodic sales and discount model and offer reduced-prices on a continual basis. Although the company has yet to see any success from the new sales strategy, J.C. Penney officials still believe in its promise. Jeff Minkin, a regional sales manager who has produced top-notch sales in the video and technology markets, offers his expert insight to explain and comment on these shifts.
According to the article, J.C. Penney is a retail outlet that has seen much success in past years due to its routine blowout sales, newspaper coupons and seasonal discounts. However, the very strategy that has led to its success may have caused a rapid decline in sales. The Wall Street Journal explains that the "attempt to reset the pricing on mass-market clothes comes after several seasons of steep discounts in which retailers have effectively trained consumers to wait for markdowns-even if prices were artificially marked up in the first place". J.C. Penney CEO, Ron Johnson, leads this monumental shift and asserts that he and the company will not waver despite a continuing drop in sales following the new low-price strategy.
Having learned from his own experience in the retail sales industry, Jeff Minkin explains the J.C. Penney dilemma. "J.C. Penney's new corporate strategy while bold and brave has seemingly not caught on with consumers. I feel that its new marketing campaign based on everyday -low pricing instead of the frequent use of coupons and sales has not struck a chord with shoppers." According to the article, consumer sales aren't the only thing faltering. It notes, "The stock has lost more than a third of its value since a disastrous earnings report in mid-May, when Penney's posted a $163 million loss and said sales fell 20% in the first three months of its fiscal year."
Both Minkin and the article note that the lack of success for the new strategy may be in part due to a faulty branding strategy. Customers do not understand the new approach and terms surrounding the new Penney identity, as much as they do not understand the company's attempt to branch out to new audiences. Jeff Minkin comments on the retail outlet's advertising scheme to use Ellen DeGeneres as a way to enlist consumers. "The use of new spokesperson Ellen DeGeneres has not fared well for J.C Penny's store sales either since the campaign began in mid-February."
ABOUT:
J.C. Penney is passionate about sales and technology, and combines both interests in his career as a regional sales manager. For ten years, he has been a leading sales figure in the video and IT industries, bringing his organizational abilities and sales prowess to technological companies across California. Minkin has worked for such companies as ANEW-ct Technologies, Da-Lite Projection Screen Company, and more.