JCPenney ad apologizes for changes made by former CEO Ron Johnson
A TV ad released this week by JCPenney asks customers to "come back" to the department store, alluding to heavy losses suffered from sweeping changes made by ousted CEO and former Apple executive Ron Johnson.
The 30-second spot, posted to the company's Facebook and YouTube pages, atones for the recent changes believed to be the reason for a steep decline in sales, which resulted in a $12.99 billion year-over-year decline in revenue for fiscal 2012.
During his tenure at JCPenney, Johnson, who was the driving force behind Apple's hugely successful brick-and-mortar Apple Store retail chain, made a number of substantial tweaks to the department store's business model. The initiatives, such as bans on sale pricing and the promotion of trendy products in "stores-within-a-store," fell flat.
Under Johnson's one year with JCPenney, sales fell 25 percent and the company posting a net loss of $985 million. As a result, he was fired in April, with Mike Ullman, who Johnson replaced in 2011, called back to his post as chief executive.
Voice over from the commercial:
With Apple in need of a senior vice president of retail, speculation has abounded regarding Johnson's possible return to the Cupertino company. For now, retail operations will continue to be directly managed by CEO Tim Cook with help from Apple's vice president of finance Jim Bean.
The 30-second spot, posted to the company's Facebook and YouTube pages, atones for the recent changes believed to be the reason for a steep decline in sales, which resulted in a $12.99 billion year-over-year decline in revenue for fiscal 2012.
During his tenure at JCPenney, Johnson, who was the driving force behind Apple's hugely successful brick-and-mortar Apple Store retail chain, made a number of substantial tweaks to the department store's business model. The initiatives, such as bans on sale pricing and the promotion of trendy products in "stores-within-a-store," fell flat.
Under Johnson's one year with JCPenney, sales fell 25 percent and the company posting a net loss of $985 million. As a result, he was fired in April, with Mike Ullman, who Johnson replaced in 2011, called back to his post as chief executive.
Voice over from the commercial:
While short ad appears to lambast Johnson's decisions post facto, according to Bloomberg, the commercial was made under his watch. The publication cites JCPenney spokesman Joey Thomas as saying development of the commercial began a few months ago as a result of poor customer feedback.It?s no secret, recently J.C. Penney changed. Some changes you liked and some you didn?t, but what matters with mistakes is what we learn. We learned a very simple thing: to listen to you, to hear what you need, to make your life more beautiful. Come back to J.C. Penney. We heard you.
With Apple in need of a senior vice president of retail, speculation has abounded regarding Johnson's possible return to the Cupertino company. For now, retail operations will continue to be directly managed by CEO Tim Cook with help from Apple's vice president of finance Jim Bean.
Comments
p.s. Tim, bring Ron home.
Originally Posted by digitalclips
Sorry we tried to treat our customers as if they had brains. We are now going back to fooling you with raised prices and discounts coupons.
I came here to say exactly the same thing.
Too bad. I knew it wouldn't work
Hey wait till I correct my Gin & Tonic screwed up English will ya! LOL
In JCP's defense, their store is very useful for us here in Sarasota, FL as we can park outside it easily as their area is usually empty and cut through to the rest of the Mall.
Some people just don't like change, especially a drastic one. The successful invention of one thing does not mean it'll lead to a successful reinvention of another.
I don't disagree. As others have said they didn't give it enough time IMHO. But ... after all is said and done Ron should be flogged for leaving Apple then forgiven and brought back. The Apple model is not easy to duplicate for all the reasons we all know here on AI.
He expedited their decline, for how much longer did you expect them to accept such a drop in sales? How many here want Tim Cook's head for running a successful company with record sales?
Quote:
Originally Posted by digitalclips
p.s. Tim, bring Ron home.
That would be an unmitigated disaster.
The guy's career is finished. If Apple can't find anyone internally to fill the role, it's a major (HR) failure on Johnson's part (before he left Apple).
Quote:
Originally Posted by scotty321
The only mistake that Ron Johnson made....
The only mistake?! Have you even been reading the news?
People truly don't get that Apple Executives were managed heavily by Steve. He never hesitated to tell each and everyone of these egos that they are effin' up and need to show more or hit the door.
People bent to Steve's vision and will, not the other way around. He helped create a lot of people who then left thinking it was all them. There is a reason so few people from Apple actually go on to be huge successes in their own start ups. They never had that 1% vision to lead.
Great talents each in their own rights, but never seem to grasp they never had `it' in the first place.
The same goes for Microsoft, Oracle, IBM, Sun, SGI, you name executives doing their own start ups.
Technically brilliant, artistically brilliant to managerially talented but never about vision.
Steve bounced ideas constantly off of brilliant people in a hope to get a symbiotic relationship built. He had very few of those and those he did have he had for very specific roles at Apple.
Tim Cook leaving Apple to start his own business would ultimately be a disaster as well. Bertrand or Avi's own start ups will amount to nothing beyond getting some technology bought out.
Ron should have stayed at Apple. He peaked at Apple.
Completely appropriate judging by their demographic.
So jcpenny's plan is
Failing business. Fire CEO and bring in that Apple retail guy
Apple retail guy shakes things up. The few remaining customers we had don't like it (and we don't know if we will get new customers, because we didn't give it enough time)
Fire that Apple guy
Bring back old CEO
Beg customers to come back. Saying, "don't worry! We will return to our old failing business model with our old failing ceo"
Sounds like a plan.
The Apple premium model will never work in a department store. He should have known that from the start (too much time in a RDF). The premium model works for Apple because Apple is a brand and they have high loyalty and strict control over distribution and pricing.
Why would people pay $50 more for a product at JCP's store-within-a-store, when they can in 4 minutes walk to the other department store and buy the EXACT product for less?
JCP is not a product like Apple. JCP sells other peoples' products.
Apple is also very inelastic and as shown by JCP "mistake" what they sell is very very elastic.
Quote:
Originally Posted by starbird73
So they brought back the CEO they fired to bring RJ in for, right?
So jcpenny's plan is
Failing business. Fire CEO and bring in that Apple retail guy
Apple retail guy shakes things up. The few remaining customers we had don't like it (and we don't know if we will get new customers, because we didn't give it enough time)
Fire that Apple guy
Bring back old CEO
Beg customers to come back. Saying, "don't worry! We will return to our old failing business model with our old failing ceo"
Sounds like a plan.
Quote:
Originally Posted by starbird73
So they brought back the CEO they fired to bring RJ in for, right?
So jcpenny's plan is
Failing business. Fire CEO and bring in that Apple retail guy
Apple retail guy shakes things up. The few remaining customers we had don't like it (and we don't know if we will get new customers, because we didn't give it enough time)
Fire that Apple guy
Bring back old CEO
Beg customers to come back. Saying, "don't worry! We will return to our old failing business model with our old failing ceo"
Sounds like a plan.
LOL!
What's so sad is that JCP couldn't find anyone more qualified to take the job than their last, failing CEO. I guess when you are the Titanic, not many people want to work there.
So... they didn't give Johnson nearly enough time to turn the Titanic around and shift an entire brand... then booted him and put JCPenney not in the hands of someone new, but in the original hands that were sinking the ship to begin with. Then they apologize to the passengers and promise a return to their former course of doom
Meanwhile, my only real gripe with JCPenney concerns clueless and terrible staff--and although I blame Johnson in part for not fixing that, it's certainly not the result of Johnson's plan (in fact it would seem to be the antithesis). If the staff now rapidly become more able to answer questions and do basic things (like ring up an order without making you roam for miles looking for signs of life) ...then I'll consider saying it was all Johnson's fault. And I'll still give Johnson credit for the no-games pricing that I found genuinely appealing.
(Would be cool to see him back at Apple.)
EDIT: Great minds think alike, AZREO!