Two weeks ago, the retailer announced that it is returning to a traditional pricing structure after it tried what some called a radical marketing and pricing strategy.
In 2012, the company declared that it would no longer offer traditional sales and markdowns to customers, just standard low pricing. The explanation was pretty simple: We will no longer insult you, the consumer, with marked-up prices just to slash them every couple of months to make you feel better. Instead, our price will be low every day.
I thought it was a good idea at the time. It signaled to consumers the company respected them. No more clipping coupons. No more rushing to the store for a sale that only lasted one day. No more games, just good deals.
Ultimately, though, shoppers rejected the idea.
According to the Associated Press, J.C. Penney in February is expected to announce its fourth consecutive quarter of big sales drops and net losses with the stock falling and the company’s credit ratings at junk status. As a result, the store will return to running sales and will show a manufacturer’s suggested retail price and the Penney’s “markdown” price on sales tags.
So how does a company that supposedly changed its policies out of respect for the customer return to the original retail practices against which it railed and save face?