This was a group project of the JCPenney Company and shows the breaking down of their strategies financially, economically, competitively, etc. These strategies define their operations and its ups and downs throughout the company’s history. This ppt. was made as a visual aid for our presentation back in the Fall of 2012.
2. Overview
History
Industry Overview
Current Business Plan
Major Competitors and Competitive Rankings
Current Competitive and Firm Financial
Performance
Environmental Factors
SWOT
Major Competitive Issues
Recommendations and Results
Risks
3. James Cash Penney CEO Ron Johnson
Established 1902
1915 1920’s 2012
83 647
1102
13. General and Specific Environmental Factors
Segment/Trends and Events Positive Neutral Negative
Demographic
Aging Population X
Changes in Ethnic Composition X
Greater disparities in income levels X
Sociocultural
More women in the workforce X
Postponements of family formation X
Political/Legal
Increases in Federally mandated X
Minimum wages
Technological
Emergence of Internet technology X
Miniaturization of computing X
technologies
Economic
Unemployment Rates X
Consumer Price Index X
Interest rates X
Global
Increasing global trade X
Emergence of the Indian and X
Chinese economies
15. SWOT Analysis of JCPenney
Strengths: Long History
Brand Recognition
Established Locations Nationwide
Exclusive Popular Brand Names
Weaknesses: Decline in comparable store sales
Decrease in popularity
Changing business strategies
Lack of coupons
16. SWOT Analysis of JCPenney
Opportunities: Internet Sales
Exploring Niche Markets (Maternity or
Big&Tall)
Attracting New Customers
Complete overhaul of marketing strategies
Launching new exclusive private label
brands
Threats: Rising Labor Costs in the U.S.
Increasing competition in industry
Internet-customers comparing prices
Weak consumer spending
17. Major Competitive Issues
• Changing of brand image
• Selling Strategy
• Marketing Strategy
• Environmental Factors: Aging Population,
Women in the Workplace, Unemployment
Rates, Interest Rates, and Minimum
Wages.
18. Strategic Recommendations and
Results
• Explore niche markets, for example,
Big&Tall and Maternity
• Move more aggressively into online sales
• Allow customers to use coupons again
• Launch new exclusive and private label
brands
• Fire the CEO if sales continue to decrease
19. Risks Associated with
Recommendations
• Implementing new strategies could result
in more confusion for customers which
could lead to a further decrease in sales.
• If reaching out to a niche market,
JCPenney could suffer financially if it
doesn’t work.
• A change in management would cost the
company a considerable amount of time
and money.
JCPenny was founded in 1902 by James Cash Penney and William McManus. At the bottom you can see how the department stores grew. The Current CEO of JCPenny is Ron Johnson.1962- entered catalog service1981- Moved away from auto & appliances and focused more on clothing and home.Today sales are dropping because of the abandonment of key customers.
The department store business is very competitive. Onforbes Global 2000 list, Macy’s is the department store industry leader, ranking in number 405, than followed by TJX at 546.From the list you can tell that consumers are taking advantage of discount stores like TJ Max and loyalty stores like Khol’s. JCPenney’s changes has moved them down the list. http://www.forbes.com/global2000/#p_1_s_a0_Department%20Stores_United%20States_All%20states_
Goal: to become “America's Favorite Store”. With using their new price and shops strategy to help. They are focused on price and the younger market. The pricing strategy was created by the CEO and is called “Fair and Square”.The strategy JCPenney has in campuses their vision: “On every visit, customers will discover great prices every day in a unique Shops environment that features exceptionally curated merchandise, a dynamic presentation and unmatched customer service
Chart shows the return to its Investors over 5 year periodJCP = (-36.91 %) HSN (+183.6%) Sears(-43.19%)
Chart shows track of overall sales since 2007 and predictions for future sales
4 major strengths. Weakness: decrease in popularity among competitors such as Kohl’s and Macy’s. Business Strategies leave customers confused. Lack of coupons leads to a lack of loyalty.
Internet Sales-Marketing and Selling Products Online. Niche Markets abandoned by other retailers. Become “America’s Store.” Internet-allowing customers to compare products to find lowest price.
Environmental Factors-Many more “Baby Boomers”, more women in the workplace, and unemployment is high. If interest rates increase, it may deter customers from shopping, and if minimum wages increase, they may be forced to lay off workers, or their costs will increase.
By catering to a more focused group, JCPenney’s sales may increase as well as customer loyalty. Marketing and Selling more products online.
A change in management may not lead to an increase in sales.