The J.C.P Company

The J.C.P. Company is a major mass chain retailer of lower moderate sportswear for men, women, and kids. They have attempted to reposition themselves as a value priced retail store and eliminated sales coupons to promote “everyday value pricing” as their new key strategy for growth. In addition, they launched a Sephora cosmetics division as part of the firm’s national expansion plans. The company previously demonstrated high sales growth and profit margins until recently. They have a decent following among babyboomers who are middle aged shoppers that prefer basics and good value clothing for the suburbs where most of these stores are located. However, JCP is losing market share to other retail brands such as Macy’s and Kohl’s and Target stores. Now the company has tried to reposition their target market to attract the “middle America” shopper and also reach out to Millennials who are young and savvy.

The firm was trendy in the 1980’s through their association with great suppliers and easy sportswear that worked for housewives, working parents, and classic lifestyle preferences. They supported marketing events on television shows such as “Desperate Housewives.” The corporation has just raised the capital needed to streamline its production and distribution facilities in order to improve their supply chain management. Moreover, the senior executives in the firm are also evaluating various marketing and retail opportunities that could potentially increase sales, market share, and profits while broadening the customer base.

The retail environment is highly promotional and customer traffic is slow due to rising gas prices, energy costs, and concerns about inflation and a recession. The stock price of the company has plummeted on the NYSE. The firm has also had excessive markdowns because of slow sales and excess inventory. The brand has saturated the marketplace and some retailers have lost confidence in the design team and direction of the company’s new CEO Ron Johnson who came from the Apple Stores. Although he was fired in April 2013 for poor sales, profits, and lost shareholder value, the lasting effects of his poor reign linger. Industry insiders believe that the brand has already matured with no future growth opportunities anyway. Some suggest that licensing the brand or exploring a revamped website might be good alternatives. However, both of these choices have inherent risks as well.

How does J. C. Penney regain the confidence of Wall Street analysts and their retail department store partners and return to brand prominence and profitability?

How do they reposition their brand for a new customer while maintaining the brand loyalty of their old one? If you were the newly appointed CEO of the firm what would you do?

Reminder: NO ATTACHMENTS ACCEPTED. Include a bibliography of sources used in the exam.

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