It's Personal: More on Penneys' effort to bounce back

"We went back to the things that we knew [customers] loved," a Penneys spokeswoman said.
"We went back to the things that we knew [customers] loved," a Penneys spokeswoman said. (Bloomberg)
Posted: November 20, 2013

When she called Monday to explain J.C. Penney Co.'s holiday strategy to win back customers, senior marketing vice president Deb Berman ticked off a ton of fixes aimed at recapturing $4 billion in sales that vaporized last year.

No longer will Penneys stay shut until Black Friday, as it did in 2012 while frenzied competitors threw their doors open on Turkey Day. Hustling for every penny now, the department store will open at 8 p.m. Thanksgiving.

And returning to the sales floor on Black Friday are even more signs of the old Penneys: Cooks kitchen appliances (the discount store brand drastically cut back under the leadership of now-ousted chief executive Ron Johnson), door-buster sales such as $19.99 women's boots (to draw disaffected Penneys bargain-hunters), and - unlike last year - enough of that cheap stuff in stock so it doesn't run out before day's end.

"We went back to the things that we knew [customers] loved, we got those things at great deals, and we are stocked up and waiting for them to come through the doors," said Berman, days after my Nov. 13 column on the beleaguered retailer. Our talk coincided with the company's making public its Black Friday promotions.

It is a Hail Mary pass, but the Texas-based retailer is pulling out its old playbook - one that newly returned chief executive Mike Ullman has retrieved from the ashes of Johnson's failed bid to reinvent Penneys by ripping it apart and starting over.

"Mike has been back for about 200-plus days," Berman said. "And when he came back in, he said, 'There aren't three big things that are broken; there's a hundred fundamentals that need to be shored up.' "

According to Berman, Penneys lost 30 percent of its customers to the failed experiment that Johnson, who had helped engineer the famous Apple store concept, attempted during his 18-month stint as CEO.

That's a lot of people who, in the past few years, swiped their credit cards anywhere but the chain's many locations across the Philadelphia region.

To lure them back - a tough task, given the retail mantra of "It is easy to lose a customer, harder to win one back" - Penneys is not just loading up again on discounted goods. It has scrambled to rebuild its home-goods offerings, to make the items more shoppable.

For one, towels are again displayed together in one department, rather than tucked into the separate displays of different brands that Johnson scattered across each store, Berman said.

"You could not easily compare, which is exactly what our smart, savvy customer wants," Berman said. "It was more work than it should be."

Special sizes for children's clothes, including boys' husky sizes, are also back. So are women's petites - more casualties being rehabilitated.

Dramatic changes, of course, will take more time. Too much was done under Johnson's reign - in some cases complete and drastic store renovations and merchandise overhauls - than can be reversed in a matter of months. (Johnson was fired in April.) Berman said more display changes are due in March.

Meanwhile, investors who hold Penneys' low-priced stock are watching closely to see how well the corporation pulls in customers during the holidays. Will shoppers take the bait? Register receipts will answer that question soon enough.

215-854-2431 @Panaritism

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