"Two Hands on the Same Steering Wheel" Almost Drove JC Penney Off a Cliff
Jun 20, 2012 - by Lester Brathwaite
Imagine, if you will, JC Penney CEO Ron Johnson is Louise (Sarandon) and Michael Francis, the recently-departed president, is Thelma (Davis). The blue convertible is JC Penney. They're driving along, maybe killed a man along the way, it happens. But they've both got their hands on the wheel. And as a result they're heading towards a cliff at full speed...
At least that's kind of the way Johnson puts it. After Francis abruptly left his post yesterday, Johnson explained:
Its very simple. Michael and I had full agreement on the business strategy for Penneys. We are huge believers that we are on track, and that ultimately we will carve out a winning position. But the marketing has not resonated with our core customer. My job as CEO is to really take responsibility for everything. I felt compelled to dive in and help with the new strategy. Michael and I both concluded we didnt need two hands on the same steering wheel. The marketing I largely left to him. The fact that it hasnt resonated [meant] I had to get involved.
After all, Louise is the one who killed that dude so there's no point in both of them going down. So maybe Thelma decides to jump out the car before it soars off the cliff. Or maybe Louise pumped the brakes and kicked Thelma out for reading the map wrong the entire time. Either way, the car's backing up and JC Penney's going to be doing things a little differently.
And this time Louise is goin' solo.
Johnson's number one priority is communicating "the benefits of our changes to our core customers. Thats what we need to do better. Adding, At this point, I am going to take direct responsibility. I will not be searching for a replacement.
A confusing pricing structure led to Penney's completely shit first quarter performance, during which the company reported a $163 million loss and an 18.9% decline in sales. To remedy that situation, Johnson's doing away with the confusion by creating a simpler pricing strategy. And making sure they're customers know about it.
The key thing is weve got to make sure the customer understands that our pricing is really terrific every day. We havent been able to communicate that simply to our core customers. We are going to refine the pricing and marketing to make it really clear that our everyday pricing is exceptional.
One can also expect stores within stores for the likes of Sephora and Martha Stewart and new labels including Marchesa. Come fall, according to Johnson, JC Penney will have an increased fashion component and will be doing a much better job of including core items in our advertising.
Let's just hope that little blue convertible can make it -- it's already been through so much. Plus, I wouldn't put it past Thelma to shoot holes in the tires. [WWD, sub req'd]