J.C. Penney’s “Fair and Square” Pricing Strategy Harvard Case Solution & Analysis

As a he gets prepared to discharge 2nd quarter 2012 results, Ron Johnson, the innovative CEO of department store J.C. Penney, is reassessing the remarkable changes he pioneered for the business model and brand image of his company. A fresh pricing scheme he put in place in February, dubbed "Fair and square", was a central part of the brand new policy. The scheme originally had three pricing tiers and eradicated typical sales promotions in an effort to make simpler the shopping experience for customers; thereby transferring J.C. Penney off its previous high low pricing practice.

Other elements of the brand new strategy comprised a new store layout, the inclusion of several well known brands, and having special lines designed by well-known designers. Nonetheless, troubling first quarter results that continued into the summer months appeared to signify that J.C. Penney shoppers, accustomed to receiving JCP Cash coupons and circulars advertising the week's specials, were slow to embrace the new pricing structure and began leaving the retailer in droves. Under the tremendous anxiety to improve matters as the all important back-to-school and holiday shopping seasons were forthcoming, Johnson decided to make alterations to the preliminary pricing scheme that were established to go into effect from August 1st. Were these alterations enough to over turn things? Should Johnson persist on the additional aspects of his efforts that are repositioning? Is Johnson's expertise in setting up Apple shops helping or hurting him as he attempts to attain his goal of making J.C. Penney "America's favorite store"?

PUBLICATION DATE: September 21, 2012 PRODUCT #: 513036-PDF-ENG

This is just an excerpt. This case is about SALES & MARKETING

Share This

SALE SALE

Save Up To

30%

IN ONLINE CASE STUDY

FOR FREE CASES AND PROJECTS INCLUDING EXCITING DEALS PLEASE REGISTER YOURSELF !!

Register now and save up to 30%.