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Individual Case Assignment Written Report JCpenney



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    Individual Case Assignment Written Report:


    The purpose of the individual case assignment is to provide the student with an opportunity to research and apply strategic management concepts and content to a real world strategic dilemma. Each student will individually research and compose a compelling eight to ten page case assignment on the brand J.C. Penney.

    Grading Criteria will be:

    25% – Content (presence of required elements, relevant references, proper terminology) 25% – Analysis (analysis of relevant variables, application of strategy theory, integration of class concepts)

    25% – Innovative Solutions: (Evidence of real thought put into turn around strategies) 25% Organization, structure and grammar (proper headings, good paper organization, solid, punctuation, grammar, spelling, sentence structure)

    Each paper should examine J.C Penney in great detail and provide the following sections.


    about jcpenney

    Walk into any jcpenney store and you’ll see that style and fashion matter to us. Talk to an associate in that store and you’ll discover that we really do care about service. Check out our compelling prices and you’ll understand the terrific values we deliver. jcpenney is becoming America’s favorite place to shop for apparel, accessories, and home fashion. Why? Because at jcpenney, we believe great style should be affordable. We’re a unique retailer, one with over a hundred years of experience, but also one driven
    by innovation. And our culture of inclusion and diversity not only makes jcpenney a great place to build a career, but it helps us to serve our communities.

    We make an impact in over 1,100 communities in the U.S., economically, ecologically, and educationally. And we do it all with style.
    our vision

    jcpenney remains one of America’s top retailers and we have a vision for our future – to be America’s shopping destination for discovering great styles at compelling prices. We want to become America’s favorite place to shop for apparel, accessories, and home fashion. We’ll do that by consistently and continually delighting our customers with our merchandise and our unrivaled services. We’re building a company culture that fosters innovation and teamwork. We believe that our associates are the key to our success. We want jcpenney to become THE place to build a retail career. Growth is our watchword. We’re working to make jcpenney the leader in our industry and deliver top financial performance. For more information on our plan through 2014, please visit the Investors section to read our full long range plan.

    History and background of

    J.C. Penny’s original brand position and key business-level strategies

    brands overview

    At jcpenney, what matters to our customers, matters to us. That’s why we offer the most desired brands in retail — brands developed with the unique needs and aspirations of our customers in mind. Spanning family apparel, home furnishings, fine jewelry, footwear, accessories and beauty, customers
    can choose from an array of merchandise available across our three integrated shopping channels: stores, and catalog.

    brand strategy
    jcpenney provides customers with style and quality at a compelling price, offering an array of good/better/best merchandise balanced by national, private and exclusive brands. Together, our private brands — which are designed, developed and sourced in-house — and exclusive brands account for approximately 50 percent of our annual sales. To ensure we continue to offer our customers merchandise that inspires, we’re focused on offering merchandise that reflects the full range of our customers’ lifestyle preferences through a lifestyle merchandising initiative targeted to four lifestyles: conservative, traditional, modern and contemporary.

    brand families

    Today’s consumer is more fashion savvy than ever. But they don’t have to buy costly pieces, over spend, or live in New York, LA, or Paris to dress in the latest styles or to buy the top brands.
    At jcpenney we believe that great style doesn’t have to be expensive. That’s why we’re leveraging our superior trend, design, product development and sourcing capabilities; partnering with the top names in fashion; and providing an exciting shopping experience and superior service to deliver style inspiration to our customers every day.

    jcpenney brand innovation

    Some think of jcpenney as just a store, a retailer. But we’re much more. jcpenney is one of the most innovative fashion industry leaders. We create and produce many of the items you see in our stores, using some of the best designers, both inside and outside our company.

    How do we do it? We focus on what’s new, what an increasingly fashion savvy public wants, and making it faster. We do all this with a focus on high quality and responsible production. And we do it all with an eye on making
    it amazingly affordable.

    meet our designers

    Some of the fashion industry’s top designers work with jcpenney. We’re much more than just a retail store.

    At jcpenney you’ll find that we not only carry the top national brands, but some of the most innovative designers in fashion today bring their special talents directly to jcpenney in exclusive offerings. Why? Because we care about fashion, are really interested in innovative and groundbreaking design, and over half the country shops at jcpenney, giving these designers a broad stage where they can share their vision.


    power brands/exclusive brands

    discounted prices—-main ideal

    first JC Penney, Golden Rule…called employees associates not employees

    in the beginning trained customers to wait for sale
    switched back to old CEO bc he was the only one that showed progress

    – 2013 environmental (internal and external) assessment: – Competitive assessment
    – SWOT assessment J.C. Penney


    digital experiences

    jcpenney was the first department store to launch an online store. has evolved into one of the largest apparel and home furnishing sites on the net. But we didn’t stop there. We’re continuing to create an integrated digital platform to reach customers where they are, drive additional sales in-store, and create a sense of discovery that inspires our customers, helping them to discover everything that we have to offer. -Our approach to the digital experience is far more than simply e-commerce. We recognize that people aren’t just shopping online. They share information with each other, compare prices, research options, and scrutinize opinions. They explore, play, and engage. Our approach is to make it possible for our customers to do all of that. -This is why jcpenney has become one of the leaders in not only e-commerce, but also in mobile experiences. And social. Even in-store digital experiences. We integrate our in-store and online shopping experiences in fresh and exciting ways. -For jcpenney, digital isn’t just a trend or a fad; it’s an essential part of how we do business. We look at the digital experience as integral to everything we do. Digital and online experiences are part of a continually evolving and experimental approach we’re using. It’s part of the transformation that’s always taking place at jcpenney. is one of the largest apparel and home furnishing sites on the Internet today. Customers use to shop and buy online, but also to get store directions, “pre-shop,” check product availability, compare prices, review trends, and then visit our stores to see, touch, try on, and purchase. lets shoppers find the latest fashions easily and uses up-to-the-hour information to insure the products they want are at their local stores. And product reviews, from customers, help shoppers base their buying decisions on unfiltered, direct information.


    Over 96 percent of the U.S. population owns a mobile phone or other device.
    They’re becoming a central part of the shopping experience. Our mobile site,, is “optimized” for the small screen experience with out the compromises. It’s about more than just shopping.

    Shoppers can quickly find, see, and purchase, all from their mobile phones. But that’s just the tip of the iceberg. We’re using QR codes and MS tags to provide shoppers with detailed information and special offers. We’re using location-based technologies to allow customers to “check-in” to our stores for discounts and special offers. We’re experimenting with mobile advertising and opt-in programs. We’re even assisting shoppers with driving directions using their phones’ GPS capabilities. We’re finding ways of combining print, store signage, even outdoor marketing with mobile experiences to connect with customers in new and exciting way.

    And we expect this to be a rapidly growing part of the jcpenney shopping experience.

    Findmore Fixture

    One of our most innovative digital experiences is our in-store findmore smart fixture. findmore is a large electronic touch screen kiosk where shoppers can discover more products or more about the products they’re looking for. They can even place orders for product or other sizes and colors right on the findmore screen. “Fun,” “Easy to use, “ and Saved me time from going home or looking online” are just some of the customer comments we’ve received on the findmore fixture.


    THE JC PENNEY DISASTER TIMELINE: How Ex-Apple Guru Ron Johnson Is Destroying The Company

    Update: Michael Francis, president of JCP, announced his resignation on June 18, 2012. Francis was hired by Johnson during JCP’s c-suite overhaul. -Ron Johnson, the former retail boss at Apple, became CEO of department store
    chain JCPenney in November 2011. -Since then the company, which had a very good 2010, has implemented a series of gigantic overhauls to nearly every aspect of its business. -It’s resulted in the shedding of customers, sales, employees, and profits. It’s so bad, one employee warned, “I fear we are turning into Sears, the laughing stock of retail.”

    -Johnson inherits a company that didn’t notice a looming cotton crisis.

    The company did well in 2010 (increasing profit 36 percent over the year prior). But cotton wreaked havoc on the clothing industry in 2011. Flooding and other shortages caused cotton prices to hit an all-time high. Rather than staying conservative with expectations, J.C. Penny raised its earnings expectations at the beginning of the year, as if cotton prices weren’t an issue. JCP shares dropped nearly 5 percent as a result.

    -At the end of 2011, JCP fired its longtime ad agency.

    Saatchi & Saatchi and JCPenney “mutually decided” to part ways after five years in December of last year. It came only a few weeks after PMK-BNC was brought into replace M Booth & Associates, the company’s PR agency for the last six years. Now things were changing — really quickly.

    -In January, Johnson lays out his vision with a Steve Jobs-esque keynote.

    Johnson got to witness the master of keynotes work many times during his tenure in Cupertino, Calif. In January, he held an Apple-style conference that made it clear: JCP was going to try to be like Apple. It was awkward how many times Apple was mentioned during the keynote, but that’s what the people wanted to hear. The key takeaways:

    Marketshare is king.
    Retail prices have risen, while retail value has remained stagnant. This leads to discounting, which hurts brands like JCPenney.
    JCPenney ran 590 promotions in 2011, consumers ignored 99 percent of them. As such, Johnson only wants 12 promotions.
    Sales were removed in favor of regular pricing with the best prices offered the first and third Fridays of each month.
    Rather than one big store, Johnson wants brands to have smaller shops within JCPenney locations, a Genius Bar type concept will be placed in the middle.

    -And he introduced a new logo.
    Johnson showed off the new logo during his keynote, it was the third logo in three years. The new logo captured JCP’s newly-launched “fair and square” pricing strategy fairly well, but it didn’t make customers want to adopt the pricing model any quicker. -In April, JCP laid off 10 percent of its corporate staff.

    Johnson hoped to save $200 million by firing 600 of JC Penney’s 5,900 employees at its sprawling Plano, Texas, headquarters. It was described as a streamlining effort and couldn’t have helped morale going into what would be a disastrous May.

    -Including all its top execs.
    The speed at which Johnson replaced nearly all of the company’s top executives was remarkable. It created a situation that makes it impossible for Johnson to avoid credit or blame — right now it’s the latter.

    -And then it axed ‘thousands’ of middle managers.
    Even now, it’s unclear how much of middle management was fired in early May, but one source told us “thousands.” The JCP PR team was once again explaining the importance of long-term goals, while the mood amongst the retail staff was grim. One employee described how things went down:

    “One hundred store managers across the country were quietly laid off two days before they announced the home office reductions and the call center closing. The rest, phase two, happened Monday. They said it was done purely on year-end appraisal ratings, but someone in my store got a higher rating than I did (and was laid off anyway), and also they changed what the ratings stood for this year, and eliminated performance improvement documentation,
    so that they did not have to wait longer to do this. If my name or even state comes out I will lose my severance.”

    -Then Johnson got rid of commission for retail employees.
    JCP ended commissions for its sales staff. The company spokesperson tried to explain how it would help “personal growth and development,” but the real reason is simple: economics. Employees described May 9 as having a “funereal atmosphere.” The stock was falling, people were being laid off, salaries were cut, and sales and promotions were becoming extinct. It was not a great time to be an employee at JCP. -Macy’s was reaping the benefits of the mess at JCP.

    When Johnson announced his master plan for the company’s success, at the top of the list was controlling marketshare. Unfortunately, despite positive surveys regarding the changes, its customers are leaving for Macy’s. Unlike JCP, profits at Macy’s were up 38 percent in Q1 and Macy’s head Terry Lundgren was confident enough about how bad things were at JCP that he told Women’s Wear Daily that market share was going to continue to increase. -5/16/12: WORST DAY EVER.

    Here’s how the collapse started. Q1 numbers were a big miss:
    Sales of $3.15 billion, missing expectations by $250 million
    Loss of 25 cents a share, 1.5x expectations
    It didn’t take too long after the announcement for the stock to plummet. It dropped 19.7 percent in a single day, leading many to describe it as the company’s worst day ever. -In June, ‘sale’ was brought back.

    When Johnson took over, he argued that the constant discounting of items created a cyclical degradation of the JCP brand because of a stagnant value in face of growing price.But this year, JCP admitted “month long savings” was not an effective replacement for “sale.” So, after only a few months, it brought back the word “sale.” An analyst for CITI claimed 2/3 of JCPenney’s customers did not understand its new pricing system. -But the customers are continuing to shop elsewhere.

    On Friday, Morgan Stanley put out a report indicating the constant rebranding of JCP is driving its core customers away. While it might not be easy for JCP to see internally, for outsiders the problem seems obvious: a complicated pricing structure and constant image makeovers.

    And now there’s a deadline on Johnson’s job.
    August. That’s how long one Citi analyst thinks Ron Johnson has to start turning the company around. If that truly is the case — it’s time to bring back the coupons. Johnson’s massive overhaul was either going to be genius or an utter failure. Currently, it appears to be the latter. Q1 2012 sales at JCP were down 20 percent from the year before. It closed five of its 1,1100 stores in Q1, after axing seven the year before. And still same-store sales were down. The stock is down 30 percent. The book may be about to close on Johnson, unless he’s got something unexpected up his sleeve for the rest of 2012. Read more:

    – Identify five high level strategies that will drive future growth based on the environmental assessment. Each strategy should have a key performance measure linked to it

    customer interaction

    Catering to Our Customer

    -We’re one of the largest retailers in the US. Literally half of all Americans shop at jcpenney. And we don’t take that for granted. -We know shopping is not just about price; it’s also about service and a shopping experience that is personalized to you. -How do we create that experience? We ask questions and we pay attention to the answers. We devote considerable resources to continually surveying our customers and listening closely to the feedback we receive from surveys, from online, and from our jcp insider program. -And we focus on our czommunities. We have used what we discovered from our increasingly diverse customers to shape what we offer, how we
    market, and continually improve our service. jcpenney is becoming more successful by embracing inclusion and diversity in our customers and communities and it’s making us better positioned to become even more successful in the future.

    Customer FIRST

    -Serving the customer is in our company DNA. It was one of the first things that set jcpenney stores apart over a hundred years ago. That’s something that hasn’t changed. Our founder wanted to keep the name “The Golden Rule Store” [link: jcpedia], because he believed deeply in the truth of treating others well. Even though we took his name instead, the desire to provide great customer service never left us. -When you walk into one of our stores, anyone you see wearing a jcpenney badge can help you. In fact, they’ll drop what they’re doing and make sure you get the help you need. We call it CustomerFIRST and it’s a big part of our associate training. It’s what makes our customer service both different and amazing. If you call us, our customer support representatives, based here in the US, are empowered and ready to help you. They’re part of CustomerFIRST, too! Our CustomerFIRST program is designed to empower our associates to give each customer the support and attention that they need, when they need it. Everyone that a customer might interact with, from associates on in our stores to representative at our call centers are trained to make decisions that surprise and delight our customers. – Service like that may be unusual other places. But at jcpenney it’s just how we do business. -The right associate attitude makes a significant difference in how customers feel about shopping at jcpenney. Our CustomerFIRST initiative is about providing valuable customer service beyond what is expected and focuses on empowering every jcpenney Associate to make customers their No. 1 priority. At jcpenney, we believe our customers are more than just a transaction. CustomerFIRST includes three key initiatives: GREAT! (Greet, Respect, Engage, Assist, Thank and have fun!) is an easy-to-remember formula for improving customer satisfaction, and it describes how associates interact with customers. Yes We Can! empowers our associates to take care of customers without always having to ask for permission from a manager or supervisor. I Can Help
    trains all store associates – not just our selling floor associates – to assist in serving customers. Our associates know that they play a vital role in improving the customer service experience. That’s why its CustomerFIRST, tasks second.

    Inclusive, Diverse, Multi-Cultural

    -We have ads in Spanish and special messages targeted to the Asian market. In selected markets we display signs in Spanish and identify our Spanish-speaking associates, too. And you’ll find that even the merchandise in our stores is influenced by our Asian and Hispanic customers. -Our associates are as diverse as our customers and they help us shape our stores, our merchandise, and our messages. We proudly align ourselves with cultural advocacy groups that help us to understand our customers and to shape our business, our stores, our merchandise, and our actions for today’s customer.

    Getting the Inside Track on What Our Customers Think

    Our research team has many sophisticated tools, but the most effective one is this: we ask our customers. We read the comments from shoppers on about the items they bought. We have a special online community for customers called jcpinsiders. They’re part of our jcpcommunity and have a big impact on what we sell and how we do business.

    You’ll also find us on Facebook [link] and Twitter [link]. Yes, we’re listening, we’re paying attention, but we’re also asking questions. And that’s why when you come into our stores or shop online you’ll find the latest styles at compelling prices. Just what you’re looking for.

    Marketing Optimization

    One of the biggest expenditures that any retailer makes is marketing. We
    spend literally millions of dollars every year to attract and educate potential shoppers.
    [callout quote] “I know I waste half of my advertising dollars…I just wish I knew which half.” Henry Proctor
    Today we know a LOT more about the effectiveness of our advertising and marketing expenditures and we’re seeing the results. We’re measuring our marketing in ever-greater detail. And we’re targeting our marketing at both traditional markets as well as increasing our messaging to increasingly local, minority, and emerging demographics. And we’re marketing online and in new digital and social media.

    Spending our marketing dollars more effectively means increasing our effectiveness and sales and reducing our overhead.

    – Reference page(s) (no fewer than 10 references)

    One hard and one electronic copy of the individual case assignment are due to Dr. Kelley at the beginning of class on October 28th.

    There is an automatic one grade deduction for late papers.

    Individual Case Assignment Written Report JCpenney. (2016, Dec 18). Retrieved from

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