JCPenney smacks into shoppers' psyches

By Robin Melen on April 4, 2013 12:01:00 am

Thinkstock93855921_SSBLOG_SHOPPING_jcpsalesJCPenney is at it again. Last spring, the department store giant unveiled a new pricing program that was going to change the way shoppers shopped. Remember this? No more sales, just low, bottom-line prices, all the time.

The idea, from new CEO Ron Johnson, was to make it less stressful for the shopper, who wouldn’t have to worry about whether there was a sale on that particular day, or whether to bring coupons, etc. Johnson came to JCP from Apple, where there are no sales, of course.

Anyway, it seemed like a good idea at the time, but we found out an interesting thing about American shoppers: We LIKE sales! We like to hunt for a bargain, and brag about it later to friends. We enjoy the big score. Must be the old hunter-gatherer in us, but it turns out that a lot of the fun in shopping for many is the act itself.

Now JCPenney is going back to the drawing board. Here’s where I think it gets a little weird: The retailer is going to RAISE prices 40 percent on its own brands so it can LOWER them again for sales and promotions. Huh?

I asked consumer research psychologist Dr. Kit Yarrow, chair of the Psychology Department at Golden Gate University, what she thought of JCP’s latest move. She said she thinks JCP made a big mistake a year ago in not talking to consumers before the pricing structure changed. She said, “Many of us feel like JCPenney’s is part of our culture, but when it comes down to spending our money, we’re not going to spend based on heritage. It has to make sense.”

As for the strategy of marking up prices in order to discount them, Dr. Yarrow had harsh words for CEO Johnson: “It’s like he’s mocking consumers.” [UPDATE 4/9: Ron Johnson was replaced as CEO on Monday, April 8, by the man he replaced, Mike Ullman. Around and around they go.]

“I think consumers are a little bit dizzy right now,” she says. “They don’t know what to expect from Penney’s.” She said she thinks they ought to go out with a marketing blitz that says, ‘We made a mistake, we didn’t listen to you, and we’re going to fix it. We’re going to go back to being the Penney’s you’ve always loved.’ She’s not sure, though, that they will.

So the JCP failed to account for the psychology of shoppers. People are motivated to shop by different factors. In a recent Psychology Today blog, Dr. Yarrow explains that people are motivated by lots of things when they shop: the fear of missing out on something, the competition with other shoppers, the perceived value of an item (why a $400 pair of shoes reduced to $150 is perceived to be a better deal than a full-priced pair at $80), and other factors. (Her blog goes on to explain how to counteract those factors, by the way, if you find yourself overly vulnerable to sales!)

So, JCP will try again to get back the consumers it lost over the last year. What about you? Did you continue to shop there? Did you stop because of the no-sale policy? Will you go back now that it’s back to its old policy?

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Robin Melen

Robin Melen

Posted at 12:01:00 AM in
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Cathy

10:26:30 AM on Thu Apr 4 2013

I have bought almost all my clothes from JC Penny for years. In the last couple of years things have changed and I don't mean prices. My favorite items disappeared or changed and lowered in quality. I bought cotton stretch slacks made in USA under St. John's Bay for 12 years. First they changed the maker to Cabin Creek, then they said "made in China". Last ones I bought were awful. Fit, rise, length all wrong. Now not available. I loved Liz Claiborne Stretch Teck bootcut jeans. Wonderful. My friends all loved them too. Well, they are gone. So much stuff I loved there is lower quality or gone. I used to always park outside Penny's when going to the mall, just to walk through. I have stopped that now.

MP

10:37:44 AM on Thu Apr 4 2013

J.C. Penney used to be my go-to store for many things. All that changed when they changed their policy on sales, and especially since they changed the amount of apparel they carry. I can hardly find anything that I like anymore. I dislike the "new" JCP very much and miss getting coupons and sales flyers.

Terri

10:52:41 AM on Thu Apr 4 2013

I don't like the change in apparel. I was used to always easily find something in a style I liked, but not any more.

KN

11:02:28 AM on Thu Apr 4 2013

I used to ONLY shop at JCP. I would run through other stores, but never found anything. I could always count on JCP to have what I needed. No more. I ran through there last weekend just to look - for the first time in over a year. It was awful. I hate the layout of the store. I hate the available selections. I hate the pricing. They have a LONG way to go if they want my business again.

Kathy

11:20:58 AM on Thu Apr 4 2013

I used to love Penny's and was in there at least once a week until the change. Since, I have been in Penny's maybe 3 times. The last time I was hoping they had came to their senses and changed back. The visit was truly sad. They were empty. I have heard the statement, " You can't sell from empty rack". I wish someone will tell that Mr. "apple" Johnson. It looked like a cheap outlet store that was going out of business. Stripped down and cheap stuff. It was sad, Penny's has been such an American icon.

Holly

11:38:06 AM on Thu Apr 4 2013

I was a "casual" JCP shopper for many years -- usually two or three times a year. When the prices went down I thought "great"! However, the quality of the merchandise also went down along with the appearance of the stores. Not a good shopping experience emotionally, estheticly or value wise.

PeoriaCass

01:35:44 PM on Thu Apr 4 2013

One priced strategy is bold and makes perfect sense. For example: I won't go to BB&B without my 20% off coupons and only buy the number of items that I have a coupon for... Quality merchandise at sale pricing daily is an excellent strategy but the plan hasn't delivered. JCP shoppers have whiplash trying to figure it all out.

Danielle

08:54:18 PM on Thu Apr 4 2013

I agree with the sentiments of the other commenters: It wasn't the change in pricing structure that had me veering away from JCP. It was the change in inventory. I used to love going to JCP's petite's section and filling my arms full of clothes. But the quality and styles seemed to change overnight...coinciding with their new price structure. Frankly, had the clothes remained the same, I'd still be shopping there regardless of how they tinkered with the prices.

kayaker

09:09:11 PM on Sun Apr 7 2013

I love the clothes JCP has for kids and teens. They are GAP styles without the GAP prices. I love their new styles. There is an elegant simplicity to the styles and they don't sexualize children and teens. Madonna is not the style icon for my kids and JCP gets that. Their ads are a beautiful and the use of space in the stores is a welcome change from overcrowded racks filled with clothes I wouldn't buy no matter how much they reduced the prices. The store in my town is like a relaxing oasis from the typical mall stores which are overcrowded with merchandise, overlit, and noisy. I sincerely hope they get their equilibrium.

Isabel

02:04:56 PM on Mon Apr 15 2013

I like JCP but they must find a consistency to how they are going to market themselves. The must also save consumer some money by way of not sending out so many ad magazines. These are not thin paper flyers; they is silky mini-mags. They should post to their consumers addresses. Have not stopped shopping there because of Johnson, but I like the old-fashioned approach of pricing and running specials. Keep sending coupons, keep making reductions and get the consumer in house to purchase some of the nice apparel in the market.Just purchased a pair of $70 NB sneakers for my husband and with a coupon only paid %50 and they shipped for free to the store. Like that concept. If they're around, I will shop with JCP!!

lareda allen

03:05:53 PM on Fri Aug 30 2013

I use to shop at JCP haven't been there in quite some time. About eight months ago i went in to purchase a shower gift, i did find something. But womens clothes are so old looking nothing decent for church. All casual items. The pricing is awful please go back to the original system. I use to be in the store for every weekend sale, not anymore.

lucy

12:17:58 AM on Tue Dec 31 2013

i use a fashion apparels, don't like to wear ordinary or classic suits. My most favorite brands are from Tirupur Garment Manufacturers from their own.

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