We wrote a column a short while ago about how J.C. Penney,
wasn’t really a brand. Not in the classic sense of the term anymore, if you
meant that it was a name imbued with some resonating meaning that
differentiated it from its competitors – oh, and not just on price, which,
strictly speaking, would make it a commodity. And how it had become a
“placeholder,” just kind of occupying a space in the category. Oh, and that the
advertising was, well, not really advertising in the classic sense that it was
actually supposed to motivate people to act positively, but ended up being Ellen-DeGeneres-based-semi-comedic
petit amuses – something TV viewers consumed while they waited to engage with
real advertising and real brands.
Well, you might have thought we suggested something akin to
the end of the world. Readers wrote back and forth about how, since everyone
actually “knew” the J.C. Penney name, there was all the proof anyone needed
that it was an actual brand. It didn’t seem to matter that they weren’t
actually selling stuff, or, to be fair, enough “stuff” to actually make a
profit. Marketers and brand folks nattered back and forth about the commercials
and the humor and the entertainment value and how very “engaged” viewers were
(although in this case “engaged” didn’t have any relationship to viewing
followed by an increased sense by the consumer that the brand better met the
expectations they held for such retailers), a little confused by the “no-deals”
strategy while they laughed all the way to Penney’s competitors, their pockets
and smartphones full of traditional and electronic coupons. So there it was –
we said, they said.
But the marketplace is always the acid test. Or, in the case
of J.C. Penney, it might better be said the jack-acid test. The lack of
positive consumer behavior or “engagement” led to a $310 million dollar loss on
a 21% sales drop. So we were not surprised to see that Penney’s CEO, Ron
Johnson, had to report that the rest of 2012 would be as bad as the first half.
Mr. Johnson indicated that he thought they were still going to face some
problems weaning consumers off coupons, promotions, and low-lower-lowest price
strategies. You think?
Shoppers – that wily band of
wired-directly-into-the-Internet consumers – have been taught well by retailers
to expect that there’s always someplace to get stuff on sale, and often those
things on sale are real brands. So moving away from discounting without being able
to offer any other value (we mean “value” not “price) is hard. Really, really
hard. Mr. Johnson emphasized the turnaround would take time. So far Mr. Johnson
hasn’t been right about a lot but he’s probably right about that. Hard stuff
takes time.
But you know what they say about that. “Time and tide wait
for no man.” And in the brand world, the very same thing is true about
placeholders.
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