JCPenney: innovating a 100-year-old brand

Innovation is never easy in the fast-moving world of retail, and it can be an even greater challenge for heritage brands.

Department store chain, JCPenney, has been in business for more than 100 years, and the company’s Executive Vice President of Omnichannel, Mike Amend, shared the brand’s latest strategies for meeting the needs of digital consumers at Shop.org, Retail’s Digital Summit.

“Surviving, let alone thriving, means constant change,” was Amend’s opening remark. While the department store chain has a strong history of evolving to stay relevant – from pioneering private brands to being an early ecommerce adopter – some of its greatest innovation demands have occurred with the comparatively recent dawn of omnichannel retail.

One shift that has fundamentally impacted JCPenney’s approach to commerce is the values that consumers place on their shopping experience. No longer is a good encounter a matter of price; time and effort are equally important to the modern shopper.

Among the initiatives that JCPenney is introducing to increase consumer convenience is a buy online, collect in store service. Following a successful pilot programme, in less than nine weeks the brand rolled out click-and-collect across 775 stores nationwide, maintaining 94% fulfilment accuracy across all channels in the process.

Speed of innovation is very important to JCPenney, and underlying its rapid approach to implementing new initiatives is an acute focus on who its customers are. Amend admitted that there was limited understanding of who the typical JCPenney was until recently, when the company carried out a detailed research piece to analyse who was shopping with them, and what they wanted from their retail experiences.

“Our customers no longer wanted to be marketed to,” he remarked on the findings. “They are looking for conversations, inspiration and interactions.”

With this knowledge in hand, JCPenney was able to launch some innovative initiatives over a relatively short space of time. For example, it recently re-entered the home appliances market, covering concept, research, contractual negotiations and an ecommerce pilot in the space of four months. It then replicated this offering across its store estate, building more than 400 showrooms and training 2,000 staff members in just eight weeks.

But while the store came second in its home appliances launch, overall bricks-and-mortar very much remains the number one focus for JCPenney, particularly when it comes to shopper engagement.

“It is no longer capable just to be an item level retailer,” warned Amends, commenting that more than 50% of JCPenney’s sales touch a store in some way, and this will increase as it seeks to further leverage associates and inventory

“At JCPenney we fully intend to use our stores as the norm,” he concluded, noting that, for other retailers, processes like in-store fulfilment are only used as a last resort. The department store chain is happy to buck this trend, as it looks to embrace the changing needs that digitally-led consumers crave in both the online and offline space – before they need to innovate reaches critical mass.

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