This morning JC Penney reported a third-quarter, $143 million loss. It was the first earnings call by its new CEO, Ron Johnson, who joined the company on Nov. 1 from Apple.JC Penney certainly doesn’t have the dedicated following that Apple does, but it’s hoping that Johnson will be able to bring the innovative strategy he used to develop Apple’s retail stores — including concepts like the Genius Bars — to the department chain.
It’s a huge task, given the dowdy image that JC Penney has right now, but Johnson is surrounding himself with the right talent in order to make high-level changes to the company, including:
Michael Francis as president, who previously worked with Johnson at Target
Michael Kramer as chief operating officer, who previously worked with Johnson as CFO at Apple
Daniel Walker as chief talent officer, who held the same title while working with Johnson at Apple
To revamp the JC Penney brand, Johnson says the store needs more designer labels. He may instill a strategy he used while at Target, bringing in exclusive lines from high-end designers like Michael Graves.
During the earnings call, executives spoke about how JC Penney’s “home business is the worst business,” and that it plans to restructure its online business, which is currently weighed down by 50% home products. The company is also looking at a new pricing strategy and ways to reach the “underrepresented market of 18 to 35-year-olds” — and said “this is a transition year, and it’ll be a painful process.”
Bloomberg reports that there probably won’t be any major, visible changes changes at JC Penney in the coming months. But Johnson is smart to begin strategising with successful innovators from Apple and Target — and people that he knows he works well with.
Meanwhile, Apple is actively searching to replace Johnson with a new SVP of retail who can successfully roll out the Apple store concept in China.
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