retail watch | Oct 28, 2021 |
JCPenney has a new CEO and the same old challenges

JCPenney has a new president, a renewed home furnishings strategy, a new approach to the beauty business and the same old challenges in finding its place in the retail landscape.

Earlier this week the company finally filled its vacant corner office, naming Levi’s executive and retail veteran Marc Rosen as its new permanent CEO, filling a role that had been held on an interim basis since the start of the year by an exec at one of its principal owners, mall real estate operator Simon Property Group.

Rosen, who helmed Levi’s direct-to-consumer and digital business and previously spent 14 years at Walmart, steps into an office with significant issues to address. He is the fifth CEO in the past decade and assumes a job that has not had a permanent officer for at least two of the past four years. Jill Soltau, the last president to hold the office on a permanent basis, left Penney at the end of 2020 following its emergence from bankruptcy and sale to new owners, including Simon.

Rosen comes on board as Penney has stepped up its home furnishings game under chief merchant Michelle Wlazlo. In a recent online interview with Home Textiles Today, she outlined the company’s plans in home, a perennial strength for Penney but one that has been challenged with repeated changes of direction under prior management.

“JCPenney has always been a powerhouse in home, but to be honest we had lost our way a little bit. And it’s important for us to get that back,” Wlazlo said in the interview.

She also said the store’s home assortment had gotten too narrow and a bit too traditional. Wlazlo has had Penney focus on four “architectures” that were used to reposition its strategy in its home business: merchandising, price, aesthetic and brands.

Overall, the store is about a 50/50 split between national and private brands, but in categories like soft goods, the mix skews heavier towards its own labels, accounting for as much as 70 of its sales. “But that’s a strength, I believe, because people consider many of our brands to be national brands,” said Wlazlo. “Really, Penney introduced its first brand in 1914 and we’ve always been about private brands. We’ve had the credibility in private brands.”

Right now, the store focuses its house brands around four names: Liz Claiborne, for classic quality; Home Expressions, which has been repositioned as an essentials opening price point collection; Loom & Forge, with an “approachable modern” aesthetic; and Linden Street, for the casual customer. On the national brand side of home, there are two recent additions: Fieldcrest, a long-time name that was once a department store staple; and The Novogratz, a more contemporary upscale look from design duo Robert and Cortney Novogratz in 50 stores as well as online. “And there’s more coming,” Wlazlo hinted.

Penney’s challenges are significant. It is rebuilding its e-commerce side after it had lagged under previous managers, while many of its stores are located in indoor malls where traffic was suffering even before the pandemic. And with the departure of Sephora’s in-store beauty shops to Penney’s biggest rival, Kohl’s, it has had to start from scratch to launch an offering in that key merchandising category. Plus, like Kohl’s and Macy’s too, it competes in the middle market which is being squeezed from above and below by competitors who are either larger or more focused on a narrower demographic.

But with a cleaner balance sheet, stores that have just gone through a major reset and now a permanent CEO with impressive retail street cred, it has as good a chance to succeed as it has in more than a decade. It may not happen—and it certainly won’t be easy—but for the first time in a long time JCPenney’s future is clearly in its own hands.

Homepage photo: Courtesy of JCPenney

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