JC Penney's New Image: Why the Re-Branding Will be Successful

What happens when you take the ideologies of one of the most successful companies of our time (Apple) and combine it with a more than 110 year old retail clothing business? You get a re-branded JC Penney that's what. Earlier this year Ron Johnson, a former Apple employee, became the CEO of JC Penney. Along with years of experience and a knack for innovation in the retail sector, Ron brings a completely new set of ideas to JC Penney. Ron aspires to restore the integrity of the JC Penney brand and completely transform the company by 2015. So just how does he plan to change this company's image and why will it be successful?

One of the key changes that will happen with the JC Penney brand is the way products are promoted. In 2011 JC Penney offered consumers over 590 different sales at cost of more than $1 billion dollars. However, despite their massive promotion efforts, there were no noticeable increases in sales. Statistics showed that over 99% of consumers simply ignored the sales. This was likely due to the fact that this many promotions lead to confused consumers who felt like they weren't getting a good deal.

Ron's new approach to sales will greatly simply the shopping experience for consumers. Instead 590 promotions per year, the new campaign will be reduced to just 12. The simplification of the sales structure will greatly improve the customer experience in the retail store and serve to restore the customer's trust in the JC Penney name.

The next major change that Ron will implement is the simplification of the store's pricing structure. Clearance sales will be eliminated and all products will be priced according to a new 3-tier pricing system. The first tier is the everyday low price (regular price). First tier items are reported to have an average discount of about 40% when compared to other retail establishments. The second tier is the month long sale items. These items will have their prices discounted more than the regular everyday price. The final tier is the "best price" discount which occurs on selected items every 1st and 3rd Friday of the month. The days of seeing 5 or 10 price tags on a clothing item are long gone. This new pricing structure is much simpler than the old method.

In addition to this, all products will have simplified prices as well. Instead of seeing $29.99 for a shirt, you will now see $30. By rounding prices to the nearest dollar, consumers will get a simplified shopping experience. I don't know about you, but I really like this concept. With the simplification of their pricing structure, JC Penney has already sold me on their new image.

Do you remember the days when you had to have a receipt and a long and detailed story just to return or exchange something? Well, when JC Penney implements their new return policy you won't need either of these things. According to JC Penney's website, the new return policy is listed as "happy returns: any item, anytime, anywhere. it’s that simple." Ron's move to upgrade and simplify the company's return policy will restore customer confidence in this brand and the items that they sell.

Just like Ron Johnson's former employer, JC Penney will incorporate the concepts of minimalism in it's advertising. By using focused, simplified imagery and accentuating key colors in a photograph, there will be a greater emphasis on the products themselves. This move will also save the company money in the long run. If you haven't seen their new advertising campaign yet, I suggest that you go and take a look. With a renewed sense of focus on some of the best retail products available, JC Penney's new advertising campaign is sure to win over the hearts of consumers.

The retail setting is where sales are made and business is conducted. A store's layout, organization, and ambiance plays an integral role in how successful a clothing business is. Ron Johnson has big plans for JC Penney's retail stores as well. The first major change that Ron is going to implement is organizing the store with services at the center and products at the perimeter. This is very similar to how the Apple Store is currently laid out.

In addition to this, brand name clothing lines will be confined to small areas of the store called "shops". This is an improvement over the earlier method of having brands organized by sizes or styles because many people tend to shop with specific brand name in mind. Again, the theme of simplification is strongly apparent here. No longer will you have to sort through piles of discarded and cluttered clothing to find your perfect outfit.

With all these changes on the horizon many people are asking about the quality of the merchandise. The fact of the matter is that the quality of the products offered for sale is not going to change. In fact, it may improve in some situations. Through the simplification of many of the business's operations, JC Penney will save itself million if not billions of dollars annually. This difference in expenditures will offset any reductions in a clothing's retail price. In addition to this, Ron plans to add more than 100 new brands to the store by 2015 helping to revive JC Penney's reputation.

With all these changes coming to the store, JC Penney is going to have a completely new personality. Instead of being a dry 110 years old, JC Penney will now be a hip and ageless brand. This is all summed by the use of a new "frame" logo. The logo will be a great addition to the store's new image that will focus on a new simplistic style. In addition to this, it will be easy for the company to implement the logo into an advertising campaign as it can "frame" a product giving it a special focus.

All of the changes that JC Penney is making will forever change the department store model. By shifting gears and taking a new simplified approach to everything, JC Penney has (and will continue to) reinvent the customer experience. With a new image and a new brand, JC Penney is sure to come out the clear winner. Be on the look out for more changes in the future. I plan to follow JC Penney's re-branding effort as I believe there are lessons that we can all learn by watching this endeavor.