J.C. Penney Is Bringing Back The Catalog

J.C. Penney Co. is bringing back its catalog for the first time in 5 years. In a recent article posted by WSJ, Suzanne Kapner explains, the new 120-page catalog will feature items from Penney’s home department and will be sent to select customers in March. The move to a traditional marketing approach is an oddity in the digital age, where more retailers are concentrating on investing in their online platforms.

The decision was made to bring back the catalog when the company eventually learned a majority of purchases online were actually catalog shoppers using the web to place orders. The retailer is discovering the catalog can be used as a branding tool that can drive sales. “31% of shoppers have a catalog with them when they make an online purchase” according to retail consultancy Kurt Salmon.

J.C Penney_WSJ_merchandising_catalog

Finally – Zara gets it right when implementing RFID tags on merchandise

Retailers have been trying to implement RFID tags for over 10 years. Retailers such Wal-Mart and JCPenney have tried to put RFID tags on merchandise but fell short because of costs and smart shoplifters. Zara has learnt from others mistakes and is rolling out the technology in a 1,000-stores by the end of this year, according to the Wall Street Journal.

WSJ_zara_merchandising

See the Wall Street Journal article in it’s entirety:

For more than a decade, radio frequency identification chips were touted as a game-changer for retailers. But when they tried to apply the inventory-tracking technology, merchants such as Wal-Mart Stores Inc. WMT -0.68% and J.C. PenneyCo. JCP -0.49% discovered that what looked good on the drawing board didn’t always work so well in warehouses and stores.

Penney, for instance, started attaching RFID chips to merchandise in 2012, but the radio signals interfered with existing anti-theft sensors. Penney removed the anti-theft sensors, but thieves caught on and shoplifting surged. The company scrapped the project.

Now, apparel powerhouse Inditex SA, ITX.MC -0.22% parent of the Zara chain, says it has learned from competitors’ experience and is rolling out RFID technology throughout the operations of its signature brand.

RFID technology ‘gives us great visibility, knowing exactly where each garment is located,’ says Inditex CEO Pablo Isla. AFP/Getty Images

The chips, about twice the size of a standard mobile-phone SIM card, help the world’s largest fashion retailer keep better track of its stock and replenish its clothing racks more quickly, said Pablo Isla, chairman and chief executive of Inditex, which reports first-half results on Wednesday.

“It gives us great visibility, knowing exactly where each garment is located,” Mr. Isla said. “It really changes how we operate our stores.”

RFID chips can store information about whatever item they are attached to and, when prompted, emit that data via radio signals to a scanner. Inditex is burying the chips inside its garments’ plastic security tags, an innovation that allows the “fast fashion” chain to reuse them after the tags are removed at checkout.

By the end of this year, more than 1,000 of the 2,000 Zara stores will have the technology, with the rollout completed by 2016, Mr. Isla said.

The scale and speed of the project is drawing notice in the industry. The Spanish retailer says it bought 500 million RFID chips ahead of the rollout, or one of every six that apparel makers are expected to use globally this year, according to U.K.-based research firm IDtechEX.

Zara, which operates in 88 countries, generates two-thirds of Inditex’s €16.7 billion ($21.6 billion) in annual sales. For the first half ended in July, Inditex is forecast to report sales of €8.08 billion and net income of €908.6 million, according to FactSet. In the year-earlier first half, Inditex reported sales of €7.7 billion on net income of €951 million

Inditex began experimenting with RFID in 2007. Mr. Isla asked his engineers and logistics experts to figure out how to reuse the chips—a solution that would minimize costs and ensure that the tracking devices wouldn’t follow customers out the door, a concern among privacy advocates.

A breakthrough came during a brainstorming session at Inditex headquarters in northwest Spain, Mr. Isla said. An employee suggested putting the chip inside the slightly larger security tags Zara attaches to each item, a combination that experts in the field say no other large company has used.

The security tag’s plastic case would protect the chip, allowing for reuse, and it would be removed at checkout.

One benefit was on display on a recent morning, when store manager Graciela Martín supervised inventory-taking at one of Zara’s biggest outlets in Madrid. The task previously tied up a team of 40 employees for five hours, she said. That morning she and nine other workers sailed through the job in half the time, moving from floor to floor and waving pistol-shaped scanning devices that beeped almost continuously while detecting radio signals from each rack of clothing.

Before the chips were introduced, employees had to scan barcodes one at a time, Ms. Martín said, and these storewide inventories were performed once every six months. Because the chips save time, Zara carries out the inventories every six weeks, getting a more accurate picture of what fashions are selling well and any styles that are languishing.

And each time a garment is sold, data from its chip prompts an instant order to the stockroom to send out an identical item. Previously, store employees restocked shelves a few times a day, guided by written sales reports.

If a customer can’t find an item—say a medium-sized purple shirt—a salesperson can point an iPod’s camera at a barcode of a similar item and, using data gathered by the chips, see whether it is available in the store, in a nearby Zara store, or online.

By the end of this year, more than 1,000 of the 2,000 Zara stores will have radio frequency identification, or RFID, for inventory tracking, with the rollout completed by 2016. A Zara store in Madrid. Reuters

Some early adopters got only limited payback from investment in RFID. Early last decade, Wal-Mart pushed its suppliers to put chips on cases of items or stacks of cases, rather than on individual items. Wal-Mart scaled down the project after suppliers complained about the high cost of the technology—a problem Inditex doesn’t face because it manufactures its own clothing.

But the technology has slowly been catching on. In the U.S., Macy’s Inc. said this week it would expand use of RFID tags after tests showed they helped improve sales, margins and markdowns.

Other European retailers have recently embraced the tracking technology. France’s Oxylane Groupe, owner of sporting goods chain Decathlon, said it will put hundreds of millions of RFID chips on goods it sells. U.K.-based Marks & Spencer, MKS.LN -0.39%which specializes in clothing, home products and luxury food items, said it plans to track everything it sells.

Bill Hardgrave, dean of Harbert College of Business at Auburn University and a consultant on RFID, said his retailer clients have boosted sales between 2% and 30% after installing tracking devices. Traditional retailers usually know where 60% of their inventory is at any time. With RFID technology, accuracy levels exceed 95%, he said.

“Zara might not be the first, but when they implement a new technology, they do it so well that they catch up very fast,” said David Frink, chief technology officer at German clothier Gerry Weber International AG, one of the first retailers to put RFID chips on all its products.

Write to Christopher Bjork at [email protected]

disney-store-within-JC-Penney-merchandising

Disney launching in-store shops at JC Penney

In an effort to bolster their baby and kids offerings, JC Penney will begin opening Disney-branded shops within over 550 of their retail locations. According to Chain Store Age, these stores-within-a-store will offer clothes, toys, and other merchandise aimed at kids and designed specifically for JC Penney.

disney-store-within-JC-Penney-merchandising

From the article:

“The addition of Disney Shops to J.C. Penney will be a major draw in our kids department, offering customers an entirely new selection of high-quality gifts just in time for the holiday season,” said Betsy Schumacher, Penney’s senior VP and general merchandise manager.

In addition, Penney is debuting the giggleBABY, Wendy Bellissino, baker by Ted Baker, Sally M by Sally Miller, and Flowers by Zoe by Kourageous Kids brands in select stores and on jcp.com.

“The addition of these partners means that we’re not only elevating our quality and value proposition, we’re further positioning J.C. Penney as the best place to shop for kids,” Schumacher said.

According to some industry analysts, the Disney shops may be one of the most promising concepts the struggling retailer has as moves into the holiday season.

As new movies are released, the Disney shops inside Penney stores, as well as jcp.com, will be continually updated with new merchandise reflecting characters from Disney’s animated feature films.

JC Penney home department, retail localization

JC Penney Gets a New Home Department

JC Penney unveiled new home department layouts last week. According the Chain Store Age, this revamp was a centerpiece of former CEO Ron Johnson’s plan to turn the retail giant around.

JC Penney home department, retail localization

From the article:

More than 500 stores received a complete home department revamp, with updated flooring, accent lighting, custom fixturing and a widened pathway.

The new department is made up of a collection of in-store shops for popular designers, including Michael Graves Design, MarthaHome, Happy Chic by Jonathan Adler, and Design by Conran. Each shop-has its own distinct look with a size range of about 300 to about 800 sq. ft.

JC Penney Listens, shopper marketing

New ad asks JC Penney Customers to Come Back … Will They?

In the latest effort in the JC Penney turnaround, the retailer has taken to social media to win back their customers. According to an article on Chain Store Age, the ad will run this week on national television and on their social media platforms.

JC Penney Listens, shopper marketing

From the article:

The retailer posted a 30-second ad on Facebook called “We Are Listening.” The spot blends nostalgic images of Penney stores from the 1960s and family scenes. A female narrator acknowledges that the retailer recently made some changes, some of which “you liked and some you didn’t.” The voice-over continues with, “What matters with mistakes is what we learn. We learned a very simple thing – to listen to you.”

The ad ends with: “Come back to J.C. Penney – we heard you. Now we’d love to see you.”

The video also appeared on Penney’s YouTube channel.

Meanwhile, the retailer took to Twitter to ask shoppers to comment about the recent changes, what they liked and what they didn’t. The company created the hashtag #jcplistens.

Apple iPad, POS Retail Solution, Shopper Marketing

Apple’s iPad and other POS solutions playing a larger role in retailer’s bottom lines

With many retail forecasts predicting the demise of the cash register by the end of the year, more and more brick-and-mortar stores are deploying point-of-sale solutions to create an easier checkout experience.

Apple iPad, POS Retail Solution, Shopper Marketing

Many retailers cite Apple’s iPad specifically for its ease of use and shallow learning curve. According to an article on TabTimes, “Apple’s iPad is increasingly currying favor with retailers for its ability to work as a mobile and relatively affordable point-of-sale (POS) device. But now new figures suggest that the tablet is even helping merchants to attain bigger revenues.”

“With the iPad tipped to phase out of the cash register over the next year, it came to little surprise when iPad point-of-sale provider ShopKeep reported some strong sales figures from its clients recently.The firm said that its merchants experienced a 17% in total sales in January over the same store sales from a year earlier.”

JC Penney is deploying a POS solution of their own according to Retail Customer Experience:

“JCPenney spokesperson Kate Coultas in Plano, Texas, said the company began using the new system in August when they launched their in-store Levi’s shops.”

“Nearly everyone on the sales floor of the JCPenney store at Columbia Center mall in Washington state is now carrying one of the devices capable of completing sales from anywhere in the store, the article reported.”

JC Penney sales, shopper marketing

Sales events to make a comeback at J.C. Penney

J.C. Penney is changing course on its no-sales policy. It was just one year ago that the retailer, amid much fanfare, announced it was nearly eliminating sales events from its stores in favor of a three-tier pricing strategy and everyday low pricing. But on Monday the Associated Press reported that J.C. Penney is not only bringing back sales promotions to its stores, but will also add price tags or signs for approximately half of its merchandise that will show the “manufacturer’s suggested retail price” next to J.C. Penney’s “everyday” price.

JC Penney sales, shopper marketing

For store branded items, J.C. Penney will show comparison prices for similar merchandise from competitors. Comparison prices, however, will not be shown for merchandise that is part of the exclusive partnerships J.C. Penney has entered into with brands such as Mango.

J.C. Penney’s decision to strictly limit promotional events, one part of CEO Ron Johnson’s ambitious reinvention plan for the company, has not gone over well with consumers. The company has struggled, reporting three consecutive quarters of drops in sales and profits. Industry analysts expect more of the same for the fourth quarter. J.C. Penney will announce its results in February.

J.C. Penney is not revealing how many sales events it will offer. But the company said the number will be well below the nearly 600 that it used to offer prior to Johnson’s new strategy, according to the report.

Johnson told the Associated Press that the decision to bring back sales was an “evolution” of his strategy.

[via Chain Store Age]

Ron Johnson, JC Penney, mannequins, retail localization

JCPenney’s Secret Weapon For Making The ‘Old’ Parts Of Its Stores Look Less Depressing

JCPenney is in a period of major flux under CEO Ron Johnson, and its physical stores show the stark contract between the old and the new.

Ron Johnson, JC Penney, mannequins, retail localization

Johnson’s new shops — small, branded boutiques within the big department stores — are slowly rolling out, but the vast majority of the retailer’s floor space is still filled with the “Old JCPenney.”

So, what’s JCPenney’s secret weapon to spruce up the old parts of its stores?

Mannequins.

Lots of mannequins — 40,000 of them.

“Customers don’t know what to buy. They love a mannequin that shows you how to put the outfit together,” JCPenney CCO Michael Fisher told Reuters. “We find anything we put on a mannequin sells out.”

The whole idea of the store revamp is to make the place look more upscale. That means less ordinary and more specialty.

Johnson himself is a huge fan of mannequins too.

[via Yahoo]

JC Penney concept store, levi's, retail localization

JC Penney: ‘Almost transformed overnight,’ says Staten Island shopper

A new layout and a fresh look had shoppers at JC Penney grinning ear-to-ear as they hunted for good buys Monday afternoon.

Those inside the store at the Staten Island Mall were recently introduced to the store’s “Shops” concept, a configuration that places select brands in their own special niches.

JC Penney concept store, levi's, retail localization

Levi’s, i jeans by Buffalo, and The Original Arizona Jean company were the first Shops to be set up in the store in time for the back-to-school shopping season at the end of the summer.

Izod, Liz Claiborne and jcp — a new JC Penney exclusive brand dedicated to high-quality fashion basics — were added last month, according to company releases.

Levi’s is situated in a “Denim Bar” that offers an experience JC Penney expects to redefine the way customers find jeans they want to buy. Specially-trained Levi’s Fit Specialists are in place to help male and female shoppers settle on just the right pair.

“The Levi’s brand epitomizes classic American style and effortless cool. We kept this spirit in mind when we envisioned a new way to shop for Levi’s jeanswear inside JC Penney,” said Liz Sweney, chief merchant for the company. “Now, customers can pull up a stool at one of our Levi’s Denim Bars and work with a specialist to choose from a curated selection of Levi’s jeans that best expresses their personal style.”

Levi’s offers 11 fits and 88 washes and most styles are priced at $40, says the company.

Buffalo’s jeans are for men, women and children, and the i jeans by Buffalo style introduces European trends into a comprehensive collection of sportswear, outerwear, accessories and denim — all featuring quality fabrics and trims.

The entire Arizona line has been reinvented with better quality fabrics, including updated prints, washes and stitching details related to this heritage brand. With JC Penney’s “Fair and Square” pricing, customers can find essentials at bargain prices, such as Arizona skinny jeans starting at $17.

The Shops plan is set through 2014 and serves as one way JC Penney is working to create an “unforgettable store experience that will make customers love shopping again.”

Shoppers were delighted while touring the revamped store Monday afternoon.

“It’s opened up a little bit,” said Richmond resident Len, who was grabbing some Izod outfits for a golfing trip. He even spotted sweatshirts for $10.

[via SI Live]

Disney Store, JC Penney, Retail Localization

Disney shops to open in J.C. Penney

Disney has joined the roster of brands that will be setting up shop in J.C. Penney Co., with Disney children’s boutiques opening in Penney stores next fall, Women’s Wear Daily reported.

Disney Store, JC Penney, Retail Localization

The in-store boutiques will feature products designed and sourced by Disney Consumer Products exclusively for J.C. Penney’s as well as Disney stores and theme parts, according to the report.

Women’s Wear Daily got a jump on the story and reported this morning that at least 520 J.C. Penney stores will be getting the shops in time for next year’s back-to-school season.

While J.C. Penney and other major retailers including Wal-Mart, Macy’s and Kohl’s sell Disney licensed products, the goods stocked in J.C. Penney’s Disney shops will be made by Disney Consumer Products exclusively for Penney and its own Disney stores and theme parks.

J.C. Penney chief merchant Liz Sweney told fashion industry publication WWD that the shops “will command prominent space.”

[via Chain Store Age]