Hello-Hello, welcome to another wacky week here at the Prepatorium.
Today we talk about a topic I keep meaning to mention, as it is one I am eager for feedback on. We’re speaking about JC Penney and it’s many different pricing strategies the past six months. Is everyone familiar with coupons at department stores? This is from January, it was a coupon for Penney’s.
A bit of background on retailers and coupons: in some circles they are privately referred to as ‘crack,’ because once a store starts offering them it can prove habit-forming, if not outright addictive. Some retailers have found it nearly impossible to get away from the strategy of using coupons to lure customers into stores.
So back to Penneys: things started to change there when a new executive came on board; JCP hired the man responsible for Apple’s wildly successful stores, Ron Johnson. And Mr. Johnson decided there had been way too many of these.
Mr. Johnson’s antipathy is understandable, almost 75% of Penney’s products were being sold at discounts of at least 50%. So the company decided it was time to get rid of the coupons, they announced a new pricing strategy. What was going to replace the never-ending cycle of promotional pricing and coupons? A multi-tiered price structure with:
- Every Day Prices: items were going to be about 40% less than the inflated prices previously created just so the store could say something was ‘on sale’ and __% off (fill in the blank for the percent off regular price)
- Monthly Sale merchandise: some merchandise would be put on sale. For a month.
- ‘Clearance’ merchandise: marked down items sold at clearance prices on the first and third Friday of each month.
Now, I don’t know about your memory, but the older I get the worse my rememberer functions. A company wanted my little pea brain to keep track of certain things being priced lower every other…. Friday? Seriously? And then have enough brain matter left to know what things were on ‘monthly special’? Ah, no. Not even remotely possible.
Why would any retailer want to make things this hard for customers? It’s one thing to say “Hey, we know the pricing thing got a little wacky, and all of the promotions were kind of crazy.” But thinking any customer is going to get their daytimer out to track the price of your merchandise on certain days of the month is lunacy. Penney’s seemed to think changing the design of actual price tags would help, more from Time’s Moneyland:
What’s more, J.C. Penney will simplify its price tags so that shoppers won’t get confused: A red tag for the “Every Day” price, a white one for “Monthly Value,” and a blue tag for a clearance deal, a.k.a. “Best Price.”
Well, that didn’t do the trick either.
More from Forbes:
An exciting advertising campaign featuring Ellen Degeneres tried to raise the bar, but the campaign did not close the loop on where the company is headed. Whether that was due to the message or the messenger is undetermined.
If you are reading this and shaking your head, you aren’t alone. Business has not been good: shoppers have not responded well to the changes. So now we move to Plan B (or C, pick a letter, any letter), the Journal offered this update last Thursday:
Under the new policy, which kicks off in August, Penney will get rid of monthlong specials that cut prices of select items by 20% to 29% and instead will permanently mark down a large amount of merchandise in stores by similar amounts…
The company is implementing the changes in-store and online, here is what customers see when visiting the website and clicking on the “Best Prices” link.
To be fair, Penney is implementing what are hypothetically nifty concepts and products, including Sephora boutiques inside its stores. But as the Forbes story points out, customers are sparse:
The new Sephora launch is gorgeous, but the store sales floors are empty, with no customers there to see it.
The retailer is also adding other lines in boutique environments, like Levis and iJeans, along with new lines, including Canadian retailer Joe Fresh. Frequent visitors will recall the issues surrounding
that nasty fight and the lawsuits the little spat between Macy’s and Martha Stewart about her planned boutiques at Penney.
And ABC/AP report other things are in the works:
To go along with the new pricing, the company will tweak its ads. That will include inserts in newspapers every Friday during the back-to-school season that will highlight specific products like jeans. A TV ad will tout free haircuts that the stores will offer students during the back-to-school season.
In one TV spot, for instance, a dog continuously jumps through a hula hoop that a young girl is holding. The text reads: “No more jumping through hoops. No coupon clipping. No door busting. Just great prices from the start.”
Full disclosure: we haven’t been inside a Penneys for years following a less-than-stellar shopping experience. Here at the Prepatorium we would love to see the company succeed, it is a storied American brand. Hopefully this latest plan will work.
Our other tidbit today involves a grill. No, not one of these.
We’re talking about these:
For those not entirely familiar with “grills,” here is more from Wikipedia:
a grill (also front or golds) is a type of jewelry worn over the teeth. Grills are made of metal and are generally removable. They began to be worn by hip hop artists in the early 1980s, and upgraded during the 90s in New York City,
Recognizing it is a new low when your fearless leader is reduced to reportage of this nature, we soldier on, believing some might get a giggle out of knowing that TeamUSAGoldMedalWinningSwimmerRyanLochte (that is his new name I believe, all one word) enjoys wearing a mouthpiece with a US flag motif “grill”.
That is Mr. Lochte and his grill above, evidently the ‘dental embellishment’ caused a problem when it came time to accept his first Gold Medal of these Olympics. More from USA Today:
In some of those photos — if you look close enough — you’ll see he’s wearing a stars-and-stripes, jewel-encrusted “grill” across his top row of teeth.
That patriotic mouthpiece almost cost Lochte his medal, he said afterwards. Lochte said he was told he wouldn’t receive his medal if he wore the grill on the podium Saturday night, a USA Swimming representative said. Lochte put the grill on after he got his gold.
Perhaps there’s an opportunity for Gucci here? Louis Vuitton?