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JCPenney Advertising Is Off Track

10/22/2012

Where Are The Customers?

It’s nearly November 1st. The holiday shopping season, the 6 to 8 weeks, that all retailers prepare all year for. Holiday shopping makes or breaks an entire year for many retail brands.

Unfortunately for JCPenney it’s not likely to be a great holiday season.

CEO Ron Johnson has bet the entire company on a risky reinvention of one of America’s oldest and most successful retail brands. In the main I’ve supported Johnson’s concepts – such as eliminating sale prices off over-inflated margins, shops within the store and emphasizing their own brands.

That’s where it ends. I remain critical of the company’s advertising. JCP’s numbers bear out my premise that the company’s marketing strategies are not connecting.

The second quarter results reported in mid-August had losses of $147 million (or 67¢ per share), revenue was down nearly 23%, same store revenue for stores open at least a year fell 21.7%, and customers dropped by 12%.

Customer traffic counts that are down by double digits indicate the advertising is not doing the job.

Perusing yesterday’s Sunday paper insert revealed something interesting. JCP’s own brand advertising fails while their promotion of other brands works better. Here are examples:

Women’s Outerwear. This is the open 2-page spread of the insert. Featured product are from a.n.a. and xersion brands. Never heard of ’em. Must be JCP brands. The copy is totally throw away for each style. For example, “Temperature rated to keep you warmer and comes in 6 colors.” or this gem, “Ultralight premium duck down provides warmth without bulk and shell comes in 4 colors.”

The lack of benchmark’s is stunning. “Comfort rated” – to what? “Ultralight premium duck down provides warmth without bulk” – HOW? Tell the customer how cold the jacket will keep them comfortable to! Let them know why “premium duck down” achieves warmth without bulk. (For the record – by its very nature down needs bulk to create warmth and while the duck down in this product may be “premium” the down from geese is truly premium.)

Further back a page for Calphalon cookware uses copy that sells, “Our collection of dutch ovens and accessories always helps you put delicious, homemade meals on the table, (emotional connection) and our new enameled selections are no different. Dishwasher and oven safe, (benefit) enameled cast iron offers even and consistent heating and an easy-to-clean matte black interior coating. (MORE BENEFITS!) And if you find any of these items somewhere else for less, we’ll gladly match the price.” (Creating trust).

The distinction between the two examples could not reveal more. CEO Johnson has taken the marketing reins since the Michael Francis’ unexpected departure in late summer. Johnson has bet the farm on reinventing JCPenney. Unfortunately Johnson has not hedged the bet by creating a marketing plan that supports the reinvention.

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