JC Penney's Pricing Strategy

When talking about competitiveness, we don’t have to look only at sporting events. We can look at all the retailers at your local malls striding to gain your attention and money. These stores are trying to lure you in with several marketing tactics involving promotions and different offers. The mall is full of boutiques and departments stores indulging into these tactics. This includes the JC Penney, the department store that will be the focus. JC Penney has been going through a lot in recent years. New leadership within JC Penney has been challenged in how to reinvigorate its merchandising, supply, and pricing strategies in the competitive department store wars. This paper will concentrate on the pricing aspects of JC Penny new directions. First, a brief description of Johnson’s pricing strategy, also providing background on the company and department store industry. Secondly, an explanation of why Ron Johnson’s pricing strategy did not work. The environmental factors such as economy, the competition, and changing consumer behavior will be the focus. Next, what could have Johnson done better? While explaining this, take into account JC Penney's segmentation,

Johnson’s pricing strategy eliminated promotions and focused on selling recognized brands. JC Penney marked up prices so there would be room for promotional discounts. In contrast, Johnson’s Everyday pricing strategy set prices lower. This did away with the need to use sale prices. Johnson pricing strategy used whole numbers rather than ending with .99 cent. Johnson removed the manufacturer’s suggested pricing. JC Penney incorporated .99 cents into its strategy. These strategies differ. Johnson innovations were bad for JC Penney. JC Penney logo change was a welcome sight. Johnson removed every old logo and this was a success by