JCPenney: Shops Concepts Outperforming Rest of Store

Plano, TX—Comparable store sales are trending 20% higher at JCPenney’s new shop concepts—such as Izod, Liz Claiborne, Levi’s, etc. according to an update by JCPenney CEO Ron Johnson, the former retail chief at Apple.

Speaking on a call to investors on Wednesday, Johnson said the “shops within the stores are doing much better” than other parts of the department stores, but it is “way too early to draw conclusions” as the retailer is still rolling out the strategy.

The shop concept is a key part of JCPenney’s turnaround strategy, one that has been controversial since the store eliminated sales and couponing in favor of everyday low prices.

And while the “10 shops in place now only represent 10% of each store,” Johnson said they are “doing well above what we planned.” The rest of the store still is in a sales slump however,, having falling 20% versus a year ago through July.

“We had a back-to-school (season) that … continued like it started; we were pretty pleased with it. The last two weeks have been much tougher than we planned,” Johnson said.

Johnson said consumer focus groups also showed a clear change about shoppers’ impressions of the chain after they had a chance to experience some of the new store changes.

JCPenney plans to roll out some 500 Walt Disney boutiques in its store this fall, too.


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