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 Post subject: J.C. Penney
PostPosted: Sat Jun 16, 2012 7:56 pm 
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So JCPenney used to be one of my favorite stores. Well, actually one of my wife's favorite stores. With the new direction we've found the catalog is a waste (one color catalogs?), the products are rather of inferior quality (not to mention limited stock), the employees are barely out of high school (while I have nothing against kids getting an honest job I'd like someone to help me who doesn't check their texts every minute or so), and there are no "sales" where we feel we're getting a good deal (Even though I realize sales are often "percieved value" why not just go to Wally World for everyday low prices? We've found the prices are actually higher in many instances...).

The JCP stock was hovering around $48ish when the new direction was implemented. Now it is below $24. Is Mr. Johnson's plan (everyday low prices & "mall concept") going to pan out? Is JCP going to be able to survive until the new strategy begins to "work" (2016? 2017?) and the company makes profits again? I just hate to see such a wonderful company with great history being dismantled at the seams.

Has JCP completely lost touch with it's customer base?

Was this the case of a company needing evolution and not a revolution?

Is this going to be another Sears?

Thoughts?

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 Post subject: Re: J.C. Penney
PostPosted: Sun Jun 17, 2012 5:42 pm 
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He got rid of the complicated and endless sales to offer simple everyday low prices. It seems Americans don't want that. They want to be jerked around with sales. Go figure!

I think the days of the department store are numbered. Bye bye JCP, Sears, Macys, Dillard, etc.


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 Post subject: Re: J.C. Penney
PostPosted: Mon Jun 18, 2012 11:55 am 
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Some people just love the idea that they're sticking it to a company with a product that is 50% and they use a 30% coupon on top of that. Part of the fun of shopping (at least for my wife) is trying to get the best value for the money. Everyday low prices at JCP are actually now more expensive in many cases.

And what about the JCP catalogs that offer one color? What if you're a summer, spring, autumn and the color is a winter color for the month? Seriously. What wacko marketing genious came up with that.

Apparently the market doesn't like this much either. See http://www.nasdaq.com/symbol/jcp

52 Week High / Low: $ 43.18 / $ 23.14

Or maybe now is a good time to buy JCP stock? Lol. ;)

But I hear you. I think just like the car inudstry box stores will have to restructure/consolidate to adapt to the changing economic reality. Target, Walmart, Ross's, and others are giving them a run for their money in the low end. Khol's and Macey's are hitting them hard in the mid tier. Sears is struggling period. Dillard's is just way over priced.

What about firing Mr. Johnson and bringing in a woman instead?

Didn't American Airlines do something like this "Value Pricing" concept in the early 1990's with a standard tier strategy? It was a complete failure as competitors offered lower prices and American Airlines switched back.

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 Post subject: Re: J.C. Penney
PostPosted: Mon Jun 18, 2012 12:26 pm 
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I think these are all an outcome of changing technology, notably the internet.

Department stores grew because they served distribution and placement purposes. They moved goods to where consumers were and made them available. They added value in the process by performing those logistics and marketing functions.

But for the most part the internet more effectively serves the promotion function at lower cost and UPS performs the logistics function. Stores selling branded goods are generally destined for demise. Stores selling unbranded items that are highly personal, like Ross, are doing much better. Walmart succeeds because they have extremely efficient logistics and they offer every day items. Even stores like Target are suffering because more consumers use them as showrooms to try out products before buying them online.

The same thing has happened with the music industry, books, and several other sectors where distribution and promotion can be effectively done online. You won't see a successful online furniture store but anything that is a commodity or is easily tried out online will soon only be sold that way.

Incidentally, my wife shopped as Ross about 18 years ago and suggested we buy a couple hundred shares of stock. We now own several hundred shares and have sold a bunch along the way. It has been an extremely good stock for us. I would not buy more though at the current price and have actually been selling over the past couple of years. I think it will do ok compared to other retailers but I don't think the future of retail is very bright.


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 Post subject: Re: J.C. Penney
PostPosted: Tue Jun 19, 2012 8:44 am 
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Well, the head of marketing at JCP stepped down yesterday. They hired him last October with something like a $50 million signing bonus. (You'd think with that kind of pay he led the league in 3-pointers)

Now they are saying they'll go back to the sales...


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 Post subject: Re: J.C. Penney
PostPosted: Tue Jun 19, 2012 5:57 pm 

Joined: Mon Feb 07, 2011 6:33 pm
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Location: Illinois
DoingHomework wrote:
Well, the head of marketing at JCP stepped down yesterday. They hired him last October with something like a $50 million signing bonus. (You'd think with that kind of pay he led the league in 3-pointers)

Where do I sign up for that gig? I'd be happy to spend 8 or 9 months failing at a job for a measly $50 mil


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 Post subject: Re: J.C. Penney
PostPosted: Wed Jun 20, 2012 10:39 am 

Joined: Fri May 04, 2007 8:14 pm
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But http://finance.yahoo.com/blogs/daily-ticker/believe-not-jc-penney-strategy-working-says-analyst-172735462.html!


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 Post subject: Re: J.C. Penney
PostPosted: Wed Jun 20, 2012 12:57 pm 
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VinTek wrote:
But http://finance.yahoo.com/blogs/daily-ticker/believe-not-jc-penney-strategy-working-says-analyst-172735462.html!


Sound's like a big "I meant to do that."

I can't believe this analyst. First he says they were successful in driving away customers with higher prices. Then toward the end he says things will be better next year because they won't have to do as well to look good. What?


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 Post subject: Re: J.C. Penney
PostPosted: Wed Jun 20, 2012 2:10 pm 
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DoingHomework wrote:
VinTek wrote:
But http://finance.yahoo.com/blogs/daily-ticker/believe-not-jc-penney-strategy-working-says-analyst-172735462.html!


What?


I echo this sentiment. Was this supposed to be funny VinTek?

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 Post subject: Re: J.C. Penney
PostPosted: Wed Jun 20, 2012 2:14 pm 

Joined: Fri May 04, 2007 8:14 pm
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Eagle wrote:
DoingHomework wrote:
VinTek wrote:
But http://finance.yahoo.com/blogs/daily-ticker/believe-not-jc-penney-strategy-working-says-analyst-172735462.html!


What?


I echo this sentiment. Was this supposed to be funny VinTek?

Yup.


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 Post subject: Re: J.C. Penney
PostPosted: Thu Jun 21, 2012 9:50 am 

Joined: Fri Sep 12, 2008 12:29 pm
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Location: Seattle, WA
People say that they want simple pricing. But when push comes to shove they aren't willing to give up their perceived discount. It's the same reason there are few to no "no haggle" dealerships. So we end up with sales, coupons, rebates, etc. The same applies to low prices coupled with fees and taxes.

Recently my state got out of the liquor store business. I don't drink that much liquor but for the liquor I did drink, it was nice to know I could walk into any liquor store and the prices would be the same there as if I had driven across town. Now I have to shop around or accept that I am choosing to not get the best price I can. In isolation, it's a good strategy for a store/manufacturer/industry to set no haggle/no discount prices. In practice, if competitors discount then the no discount store will lose businesses to those competitors. Then you get adverse selection where only people who would have been willing to pay a higher price, go to the no haggle store (but not enough of them for the store to stay afloat).


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 Post subject: Re: J.C. Penney
PostPosted: Thu Jun 21, 2012 10:15 am 
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stannius wrote:
People say that they want simple pricing. But when push comes to shove they aren't willing to give up their perceived discount. It's the same reason there are few to no "no haggle" dealerships. So we end up with sales, coupons, rebates, etc. The same applies to low prices coupled with fees and taxes.

Recently my state got out of the liquor store business. I don't drink that much liquor but for the liquor I did drink, it was nice to know I could walk into any liquor store and the prices would be the same there as if I had driven across town. Now I have to shop around or accept that I am choosing to not get the best price I can. In isolation, it's a good strategy for a store/manufacturer/industry to set no haggle/no discount prices. In practice, if competitors discount then the no discount store will lose businesses to those competitors. Then you get adverse selection where only people who would have been willing to pay a higher price, go to the no haggle store (but not enough of them for the store to stay afloat).


It is an interesting phenomenon. Isn't Carmax supposed to be like that? No haggling and no hassle? Curious.

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 Post subject: Re: J.C. Penney
PostPosted: Fri Aug 10, 2012 9:40 am 
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Update...

Net Income: Loss $147 Million

Revenue: Down 23% - over 3 Billion

Lowest quarterly sales since 1989.

Stock is up. $1 Billion Dollars in cash.

http://video.foxbusiness.com/v/1780143434001/jcpenney-posts-ugly-earnings/?playlist_id=87185

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 Post subject: Re: J.C. Penney
PostPosted: Sun Aug 12, 2012 3:56 am 

Joined: Thu May 24, 2012 4:20 pm
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Eagle, I agree with your original post. I went there recently and compared it to a visit before they changed what they were doing. I did not find the prices to be better on anything. In fact, I found things to be more expensive than ever before. I could not find anything that was anywhere near the lower prices they had before---and I'm comparing the same things, really.

Sorry but these are no where near everyday low prices, DoingHomework.


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 Post subject: Re: J.C. Penney
PostPosted: Thu Sep 20, 2012 11:51 pm 

Joined: Thu Sep 20, 2012 11:41 pm
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hi!

you know Eagle, i think it will survive. i honestly don't see any reasons why it wouldn't

p.s. i am wearing a JCP t-shirt right now ;)

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