Home > Advertising, branding, ECMPN, public relations, Uncategorized > JC Penney’s New Pricing Model – Yay or Nay?

JC Penney’s New Pricing Model – Yay or Nay?

This recent conversation with Christina has given me fodder for a new (and much needed) post. It is referencing the new pricing strategy that JC Penney is taking in their retail stores. Goodbye to “Lowest Prices of the Season” sales….and “BIG Savings”….and “70% Off Storewide”…Yes – you can probably even hear that woman’s voice on the commercial telling you time and time again that there are great deals to be had.

JCP New Pricing StrategyHowever, over the last several decades, they were training people to not come into their store unless there was a sale going on. Realistically, that was pretty much all the time, but still – I, personally, wouldn’t buy anything unless it was on sale. Tragic, I know. And the only time I would purposely make a special trip there was if they were having a big sale. Otherwise it was by coincidence.

What?! No Clearance Sticker?! Omg….someone get me a latte….

Imagine if you went into JC Penney and there weren’t any sales. ???? Would you still shop? I think I would feel like I walked into some kind of sci-fi movie where everything looks kind of the same, but at any moment….some creature’s going to pop out from behind the clothes rack and eat my brains………………!!



Promoting Value, Not Price

That’s all they used to promote in their ads – the sales. Now, instead of devaluing their products by saying “oh, these really aren’t worth the regular price, so we’re lowering the price” or “people didn’t really like this stuff this season, so we’re clearing them out for cheap”, I wonder if they’ll take the route of promoting the value of the products they’re selling. I wonder if that means we’ll hear commercials like “JC Penney offers brands that fit your lifestyle, AND your budget.” or “Feel good about shopping with us – JC Penney is giving back….”

Or maybe they’ll get creative and offer supervised play areas while mommies shop. (I, personally, LOVE that idea.) Not only will they have to promote the products in their store, but the product that is JC Penney. What else can they do to change the experience of shopping there that will get people thinking about something other than the fact that there aren’t any sales going on?

Retraining a Generation on How to Shop

Ok – so here’s another thought – how do they educate their customers about their new pricing? They’re essentially going to have to retrain an entire generation on how to shop. When the economy is on a rocky road anyway and people are pinching pennies whenever possible, how do they tell their customers that they’re going to be paying full price? Even if they do call it a “value price” or “everyday value” or whatever – it’s still full price in the eyes of the consumer. So how do they say – ‘we’ve been doing this wrong for the last 100 years, and now we’re going to show you the actual value of these products’?

Here’s a familiar story that I’m sure many of you can relate to: My mother-in-law always gets the Sunday paper and finds the ads – it’s almost like a ritual – we find the good ones (yeah, the BIGGEST Sale of the Year!) and make a trip out of it with the girls or the kids. Then afterwards, we share with each other the great deals we found. We are always so proud of ourselves for being such savvy shoppers.

So, there’s another retraining that has to go on. Looking for sales has become part of our lifestyle – part of our social rituals…..and now JC Penney is going to be left out of that. Or are they?

Getting Them All On Board…or not?

Many retailers use this promotional pricing strategy, but it’s so overused that, as consumers, we don’t really know what the value of a product is. As marketers, how do we know what people are really willing to pay so that we know how to price our products?

So my question is: for marketers, how does this affect consumers and how they think about retail shopping? Will they appreciate the ballsy move of JC Penney and finally say to the other stores “Hey! We’re not stupid! Stop trying to sucker us into buying your stuff!”? Or, will they say to JC Penney “Hey – you’re so much more expensive now, I’m not shopping there anymore…I can’t afford it.”?

Do you think the other big department stores will follow suit? Or will they take advantage of this new environment and continue to fool us with their flashy signs and super-duper-awesome-amazing low prices (a.k.a. prices-still-with-enough-margin-to-make-the-company-a-little-money)?

My opinion? I think it is a start in the right direction. I think it’s going to be tough because most people don’t care….they just want it cheap, fast, now. But – if JCP can prove themselves and offer stories of how people are still saving by buying at their store AND getting good stuff, I think the idea will spread and it will be good for them – and good for consumers. A long road awaits…..we’ll see how it goes…..

More stories about this:

Article from ABC News on this: http://abcnews.go.com/blogs/business/2012/01/what-to-expect-j-c-penneys-new-pricing-strategy/

From Harvard Business Review blog: http://blogs.hbr.org/cs/2012/01/understanding_jc_penneys_risky.html



  1. March 1, 2012 at 8:16 AM

    Thanks for including my blog in your article! I wonder if JCP knew how much controversy they were going to create with this new pricing strategy, because there’s certainly been a lot of it. You’re right, there’s a long road ahead of them 😉 Thanks again!

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