Customer Shopping Experience

In order to enhance customer shopping experience and to tap in the specific customer segment, Johnson followed the below mentioned strategies:

• Johnson strategy included grouping of vast array of merchandise crowded on racks and shelves to 80-100 stores-within-store to stimulate customer buying experience
• He separated the merchandise according to the people and gave them value by coming out with programs that helped customer to enhance their purchases. Ex: The first shop in the stores-within-store was devoted to jeans, had a trained fit specialists and Levi’s innovative curve ID program that helped women to find the right jeans for their body type.
• Shops were designed to pull in young customers.
• Instead of giving a discount over some fictitious price, Johnson used “Fair and Square” Policy to give consumer a fixed price.  
• Johnson stated that by setting the store monthly and maintain the best prices will make customer shopping pleasant and convenient
• Johnson instituted a design that made the returning of items hassle free and called it as “ Happy Returns”

Corporate bases Strategies:

• Switching of high-low pricing strategy to “Fair and Square” pricing.
• Johnson scrapped the old design and hired an agency to redesign its new logo that evoked the American flag with red, white and blue colors and letters” JCP”  written within a square in lower case font which represented “ Fair and square”.
• Company planned to install two to three new shops each month over a span of 4 years.
• Company added value to the customer by offering free hot dogs and ice creams and “Go USA” Olympic t-shirts during summer Olympics and free haircuts for children.
• Company introduced “Fair and Square” Pricing plan that had three pricing tiers.

1. Average reduction of price by 40% to offer consumer “Every Day Fair and Square” Price.
2. Special prices on seasonal items had further reduction in price by 20-29%.
3. Special deals to clear 20% store’s stock at price 1/3 of everyday price on first and third Fridays of every month.

• Introduced Ellen DeGeneres as the new brand spokesperson.
• In Aug 2012, Johnson eliminated name “Fair and square “ and modified names of the Best Price Fridays to “Clearance”.

     Competition bases strategies:

• Created new lines of J.C Penney-Specific Merchandise lines by forging relationship with top brands like Martha Stewart and hot designers like Nanette Lepore.
• Designers Nanette Lepore, Vivienne Tam and Cynthia Rowley created low cost line for the retailer to compete against H&M and ZARA.

Even though Johnson was very pleased with the 67% sale in the first three months following the launch, customer perceptions about the brand was not so pleasing. The analyst from Deutsche bank reported that J.C Penney was actually cheaper than other brands but customers rated J.C Penney lower on perception values. This is because most of the customer felt that price offered by old J.C Penney was much better than the new “Fair and square” Model. Some customer even complained that they were no longer receiving any coupons from J.C. Penney and that made them shop more in Target and Walmart. The Loyal J.C. Penney customer gradually decreased in numbers.

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