Posted April 10, 2013 by Jessica Wright in Business

J.C. Penney decides to oust CEO

Ron Johnson ousted as J.C. Penney CEO.
Ron Johnson ousted as J.C. Penney CEO.

J.C. Penny has been struggling for a while now and the department store announced today that they are planning on letting go of the Chief Executive after he failed to attract any investors’ new shoppers using his strategy. They also announced that they are planning on hiring Myron Ullman, the previous CEO, to try to revive the department store again. Keep in mind that the department store experienced a 25% decrease in their sales. This was a decision that was somewhat shocking to many people especially after the chief executive has been trying so hard to regain the position of the company but obviously this didn’t take place at all and all the strategies he tried implementing ended up failing.

He tried doing this by implementing a new strategy that involves replacing traditional coupons or sales events with decreasing prices of products on a daily basis. He also began carving the department store’s larger collections to collections of other branded boutiques such as Joe Fresh. He also has plans to open 100 new shops in 700 new locations all over the world. However, all these strategies weren’t working as the department store continues to experience a serious decline in their sales and customer loyalty on a daily basis.

Even though some of the shops ended up showing improvement, many customers of the department store, who are known for being obsessed with deals, ended up balking on this pricing strategy and the main problem here is that he didn’t even bother testing why. By the end of 2012, the department store ended up experiencing a $950 million profit. Even though this was outstanding comparing to the state of the economy during that time, this was $500 million less than their profit for 2011 and this is why they tried to implement all these new strategies.

It is unknown what strategies the previous CEO is planning on implementing, but what is clear is that the new strategies aren’t going to do anything with decreasing prices as obviously this isn’t working anymore. It is expected that the new replacement is going to start working within two weeks but the department store has urged him to test any strategies he wishes to implement first to at least figure out what customers’ response is going to be after it is completely implemented. For now, it is obvious that JC Penny are doing everything they can to regain their position again.

Jessica Wright

Jessica Wright graduate of Northwestern University getting both Bachelor’s and Master’s Degrees in Broadcast Journalism. Jessica has been Senior Correspondent focusing on the impact of political decisions and office holders. Jessica is our seasoned investigative, political and community-oriented reporter and columnist whose work has won awards locally, statewide and nationally. Her awards have come from the National Federation of Professional Writers, the Ohio Newspaper Association, the Cleveland Press Club.