Image from: Biz Journals
JCPenney’s quest to change the department store shopping experience has been hard to ignore. The iconic retailer has hired Ellen as its new celebrity spokeswoman to tell consumers that prices have been slashed, return policies have been made more flexible and that JC Penney is a cool place to shop.
Competitors and industry analysts alike have openly questioned whether such a strategy can be pulled off. February sales numbers were down 4.9% from the same month last year.
Despite lackluster sales, all of the hype is paying off in the form of increased interest in its site. JC Penney attracted an additional 2.3M unique shoppers – a 13% increase – from February 2011 to February 2012.
The challenge for JC Penney will be finding creative ways to promote its site that give shoppers a reason to come back several times in a month given that their new model is focused on decreasing the number of sales offered each month in favor of everyday pricing. Few weekends go by when competitors Kohls or Macys are not running some sort of sale that inevitably causes spikes in traffic to their respective sites.
An early read of cross-shopping between Kohls, Macys, and Sears to JCPenney.com suggests that the everyday lower pricing is not yet beating out the drumbeat of weekend sales that each of the three department stores are running.
Analysis conducted by Compete shows that shoppers who visit Kohls, Macys, and Sears online are increasingly cutting JC Penney out of their online consideration set.
Cross shopping rates between competitors and JC Penney are down anywhere from 5-8% when compared to February 2011.
JC Penney is not going to win this race by merely telling people prices are the same or cheaper than its competitors. They are clearly betting that their newly recruited executive talent from Target will be able to change the consumer mindset through branding – that JC Penney’s a cool, hip place to shop. That type of strategy takes time to set in. The question is how much time does JC Penney have given the treadmill of monthly same-store sales reports that drive the retail industry.