Penney Looking For 2013 Turnaround
How often have you heard a radio news report attribute a bump in a company’s stock price to the hiring of a mid-upper level merchandising executive? But that’s precisely what happened on a Wall Street Journal report on WCBS NewsRadio 88 in New York last evening. Indeed, Street Insider.com also reports “J.C. Penney was up 1.4% … following news that it tapped former Abercrombie & Fitch Co. executive Brandon Tonniges as its director of visual merchandising.”
Bloomberg’s Sapna Maheshwari writes that Tonniges was a vice president in Abercrombie’s brand senses division, “which the teen retailer’s website calls the ‘creative force’ behind its store experience.” He will be helping with the revamping of layout and designer at the struggling retailer’s outlets, which in large part are turning into collections of branded shops.
But what has garnered the most attention -– not only among observers in the media and on Wall Street but, more importantly, consumers -- has been the elimination of coupons for everyday “fair and square” pricing. “Making every day a great day to shop” is a great idea, at least in theory. Problem is that less people are taking advantage of the new policy under CEO Ron Johnson, the former Apple Retail wunderkind, than before he took the reins.
“Revenues plunged $1.1 billion or 27% in the third quarter and sales at its stores opened at least a year have sunk to a level worse than JCP’s performance during the recession,” Wendy Lee tells us in a report filed for Southern California Public Radio station 89.3 KPCC earlier this week.
Culver City, Calif., store leader Matt Taylor informs Lee that he’s confident that fortunes will turn around at Penney once CEO Johnson’s changes take full effect in the coming year. The stores are already far less cluttered and the branded shops make it a lot easier for someone looking to match, say, Levi’s jeans with a Levi’s top.
“It takes a while to get this transformation rolling,” Taylor says. “2013, I think you’re going to see a different J.C. Penney. I think you’re going to see an upswing in sales.”
But many outsiders remain skeptical.
“It reminds me of a gentleman that wants to drive a pickup truck over a cliff. You know, driving over a cliff might be fun, but you ultimately crash and die and that’s exactly what they’re doing to that company,” Britt Beemer, CEO of Charleston, S.C.-based America’s Research Group, tells Lee. “They’re destroying Penney’s with every week without a promotion.”
In other bad news, Penney was listed as No. 7 on a list of the slowest shippers of online merchandise among the Top 25 retailers, according to a study by STELLAService. Packages from JCPenney.com take an average of 5 days and 2 hours to reach their destination (as did those from Macys.com, we should note).
Esquire’s Jonathan Evans, meanwhile, has an expansive Q&A with Nick Wooster, who joined Penney as vp of Brand, Design and Trend for Men's in April. An industry veteran who Evans calls “perhaps the most famous man -- and definitely the most famous moustache -- in men's wear,” is looking forward to February 1 with a mixture of exhilaration and terror. That’s when “his presence will finally be felt” with the release of the new, in-house JCP line.
“I have a reputation that was sort of built on suits and boots, so I'm a huge fan of the sartorial equivalent of a mullet, where you're business on top and party on the bottom…,” Wooster tells Evans. “So it's a jacket with a tie, or a suit with a tie, but with boots on your feet. I think it's really stylish, but useful as well.”
One of the photos accompanying the piece shows Wooster striding down the street in a dark blazer and orange pants. That’s definitely not the J.C. Penney of your Uncle Clyde from Dayton. But the good news may be that the Harris Tweed jacket in the back of your closet will be very much back in style next fall if Wooster’s enthusiasm for it has anything to say about it.