WTF Is Going On With J.C. Penney?

A timeline of the baffling downfall of a company, and what it means for local stores.

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Last week, J.C. Penney announced it will cut 2,000 jobs and close 33 underperforming stores as it tries to reverse poor profit performance. You might also be aware that the struggling department store has had quite the baffling year—from CEO changes and questionable tactics to bizarre commercials and plunging sales. Here, a little timeline of what the retailer has been up to:


-In an effort to pinch pennies, they made the worst decision in retail history risky choice to eliminate all sales and coupons. That was the grand idea of CEO Ron Johnson, a former Apple retail chief, who thought he could entice customers with consistent low prices in lieu of discounts. Yeah, that didn't go over so well. Shoppers left in droves, which led to ...

-The airing of a creepily personal 30-second spot, which attempted to appeal to consumer emotions—"Come back to J.C. Penney; we miss you" is an actual quote from the ad—but ended up seeming desperate and out of touch. The mea culpa came just a month after Johnson vacated his post. (Everyone saw this one coming; rather than move to Texas, where J.C. Penney is headquartered, Johnson commuted from California. And you think your commute is bad?) Note: The commercial is no longer available on J.C. Penney's YouTube channel—are we sensing some embarrassment?

-Then in June, Buzzfeed reported that the company brought an "organizational therapist" to a merchandising division meeting that was attended by hundreds of employees. The therapist's presence was in light of Johnson's firing and a grim year that saw revenue sink 25 percent (s0, not particularly unwarranted). Apparently the Chief Merchant, Liz Sweney, and the therapist "proceeded to compare the experience [of Johnson's tenure] to a bomb explosion and the 9/11 terrorist attacks." According to Buzzfeed's sources, Boatlift, a 12-minute video narrated by Tom Hanks about the evacuation of half a million people after 9/11, was then screened. Um, what?

-Last week, Business Insider went to a few J.C. Penney stores in suburban New York to see what kind of turmoil the retailer was really in. The photos are pretty startling (think: stained floors, vacant racks, and unattended registers).

So about those store closings. These are the Pennsylvania and New Jersey locations that will shut their doors: Exton Square Mall in Exton; Laurel Mall in Hazleton, PA; Washington Mall in Washington, PA; Burlington Center in Burlington, NJ; and Phillipsburg Mall in Phillipsburg, NJ.

But there's a sliver of good news: Beginning in February, about 3,000 sales associates in certain departments will go back to a commission pay system. Bloomerg reports that the system will act as incentive for high-performing employees to stay on, as well as increase home furnishings and fine jewelry sales. The LATimes also says that the company plans to revamp its home section. The closings will save the company $65 million a year, and with former CEO Myron Ullman at the helm, maybe a turnaround is in sight. But as it looks right now, the company has one heck of an uphill battle ahead of it.

  • Ray Kerstetter

    let ‘em sink! Along with the other retailers as well- unless they help bring the manufacturing jobs back to the US. Make all clothes and electronics for starters back here. And maybe, we’ll patronize your stores and spend our hard earned AMERICAN $$$$

    • matthew brandley

      agree!

  • matthew brandley

    Retail foot traffic has declined 50 pct since its peak in 2010. This past Christamas was worse than 2009 in sales. . With walmart laying off 2,300 smasclub workers today , half salaried and half hourly along with 100 under performing stores this year that they have not made public yet do you think jcp will be around? realy? sears is on death bed. So many other retailers such as american eagle . best buy. abercrombie fitch, radio shack will be gone in the next year or 2. Over extended . Baby boomers are retiring at 50 k a week and no longer have the disposable income to spend and theres not enough kids being born to take the place of them. The u s birth rate is at the lowest in almost 50 years. We are on the edge of economic collapse from over seas that nobody is paying attention to from 7 other countries including china. You people just dont get it do you