Moving from Apple to…J.C. Penney?

The Apple stores have the image of being hip, young, somewhat
upscale, modern, and forward-thinking. J.C. Penney stores, not so much.

So it certainly is a shock to see Ron Johnson, the man who
created and nurtured the Apple stores, be named
the new CEO of J.C. Penney
(which, according to National
Jeweler’s ranking
, was the eighth largest jewelry seller in the U.S. in

Many commentators think that Johnson’s appointment could
spell a “reinvention” not just for J.C. Penney, but for the whole department
store concept in general. As one commentator wrote:

The most important task is to get
the people of JC Penney to STOP thinking like the people of JC Penney and in
fact, to stop thinking like retailers entirely. The truth is that the department store model hasn’t changed in almost
100 years and unaided, will likely stay just as it is.

His job is to get them to question
everything they’ve ever believed about the department store experience and the
supposed immutable laws of retail. The
most important thing he can do is encourage a sense [of] naiveté throughout the
organization – enabling everyone to see JC Penney through the eyes of an
outsider.  He needs to and reward those
who challenge (not defend) outdated retail thinking.

The Apple Store didn’t come to life
because someone said, let’s create a better computer store. It was born out of an aggressive and
conscious effort NOT to build a computer store—to literally throw away every
computer store paradigm of the time.

It all sounds good, but there are risks here. We all
remember when Zale tried to reinvent itself, as well as the whole mall jewelry
category, a few years ago. Some of the ideas had potential, but they didn’t
necessarily work at Zale, which is fundamentally an often-promotional mall jeweler that sells
mid-priced basics. 

Johnson’s challenge is to revamp J.C. Penney without moving
it too far from what J.C. Penney is. Now, even though Johnson’s been associated
with Apple, he came there after a very successful track record at Target. So
clearly he knows the department store business. 

The question is: How much should, and can, be changed, at
Penney? Obviously, customer service, a strong point for Apple, is something
that could always use a boost; as one commentator noted,
Penney “came from a service background but devolved into employees recommending
customers ‘wait for the sale’ or give them the additional coupon.” But many are skeptical that this can be markedly improved; The Wall Street Journal warned,
“it will be a huge task to engender anything like Apple’s legendary
level of customer service
across Penney’s large work force.” Added a blogger
for The Washington Post

[M]any Apple stores are flooded
with applicants who are grilled on their passion for Apple products during the
interview process. Meanwhile, it’s hard for most retailers to keep turnover of
their frequently disengaged workforce below 100 percent, much less replicate
the sort of enthusiasm and energy that Apple store employees bring to work with
them each day. No matter how cool Johnson remakes J.C. Penney’s stores, men’s
ties and bed sheets will never be a match for the iPhone.

I don’t know; there are people out there who really are
passionate, and knowledgeable, about bed sheets. Maybe not as many people who
love iPods, but they exist. We know there are certainly people who feel strongly about jewelry. Can J.C. Penney find them, and, in the process,
change the department store experience? We all agree, it needs it. 

At the 2010 AGS Conclave in Boston, a professor from Harvard Business School discussed the Apple store as a model for jewelers trying to combat the Internet. Many in the audience assumed the chain’s success stemmed from the popularity of Apple products. The Professor disagreed; yes, he said, Apple products were great, but people can buy iPods anywhere, including online and at Best Buy. And in fact, when Apple launched its retail chain, many people thought they were crazy for just that reason. The reason the Apple stores do well, the Professor argued, is because they offer an experience that doesn’t exist elsewhere: they have excellent customer service and are exceedingly customer friendly. All of which is just basic retail, he said, just taken to the nth degree. 

And so we’ll see how all this applies to a department store. Shopping at J.C. Penney will likely never be as “cool” as shopping at an Apple store. But if Johnson could make it just as interesting, easy, and fun, he may just have something. 

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JCK News Director

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