Not entirely surprised. I went to check out the appliances after it was first announced and installed which I'll get to in a sec, but a few things first.
Our store received a complete Ron Johnson remodel and it looked and still looks fantastic. Making the excuse of Ellen, or mom mom and dad dad ads is really just an excuse.
The problem really was JCP did not have the money to really undertake those remodels. They also didn't have time to wait out the flat dollar pricing strategy to be accepted.
I think both were good ideas, but they alienated the usual shoppers who wanted gimmicky coupons and high low pricing. Mostly older folks who've shopped there a long time. That doesn't work. If it did everyone would be shopping at Sears because Shop Your Way is the best rewards program in existence. Only a handful of people will mess around with that stuff. The reason Sears wasn't successful with SYW is because its a gimmicky rewards program that largely caters to younger people who use rewards programs and the internet, but most of their shoppers are older just as they were at JCP, Macy's and Bon-Ton.
Now JCP backed themselves into a load of debt and were losing sales. I'm sure it would eventually have turned around but instead they ditched Ron Johnson and went back to the same old formula. It helped reverse things to some degree but didn't differentiate them, it was back to same old same old.
So then they decide to bring in appliances. I don't know what the precise reason but it likely had to do with Sears' issues. Except Sears was still competitive in appliances despite their struggles and had everything in place, allocated and designed to sell appliances. JCP had none of it other than the floor space to do it. They started it off in a few stores then for some unknown reason did a mass rollout. However they never really advertised it.
So they put the appliances in. They looked nice, the displays were modern and nice looking. Except no one was shopping them. The times I went there there were no customers and one associate. Soon there were no associates and an empty department.
One problem as I mentioned was lack of advertising. I saw a scant few ads for appliances. Can't sell what no one knows you have. Secondly the pricing was not competitive. Lowe's was almost always cheaper at the outset. Sears always had some of their typical gimmicks like free delivery or financing. Best Buy had better sale prices. Home Depot had better sale prices. Local places had better service because they advertised and had associates to sell the stuff.
There was simply no compelling reason to shop at JCP for appliances.
While I'd have stuck with it if I were them mainly because they have plenty of floor space I doubt appliances have enough turns that they wouldn't have gotten stuck with old models. They simply are not selling in necessary volumes to avoid it. With their questionable financial situation they probably can't afford to invest in it.
With Eddie wheeling and dealing to try and keep Sears alive and the talk of new small format stores, since he's somehow managed to keep this Sears stuff going so long if he somehow makes it last another year, two or longer those big debt payments JCP has coming were likely a factor in their decision to exit.
Had they had more money to stick with it it would have been one thing but they were out of the game too long and didn't market it well.
They need sales now. Not hopes of future sales. They don't have some rich hedge fund money manager like Fast Eddie wheeling and dealing to keep the game alive, nor the time to wait until he finally gives up on this Sears dream he can't seem to let go of. If you look at the track record of stores that were in Sears' financial situation with years of losses, almost all of them are already memories.
JCP also didn't have the luxury of having a still well known private brand like Kenmore to slap on anything they see fit.
JCP should focus on something more manageable that they're still somewhat known for like housewares, small appliances and cookware. Try and drain sales from Bed Bath and Beyond instead. Otherwise I could see them going in the same general direction Sears did but the more likely outcome isn't surviving bankruptcy even if the survival is short lived.
Rumor is JCP is reducing their appliances tomorrow. I'll be going to check it out and get pictures of their display setup because it looked quite nice.
Our store received a complete Ron Johnson remodel and it looked and still looks fantastic. Making the excuse of Ellen, or mom mom and dad dad ads is really just an excuse.
The problem really was JCP did not have the money to really undertake those remodels. They also didn't have time to wait out the flat dollar pricing strategy to be accepted.
I think both were good ideas, but they alienated the usual shoppers who wanted gimmicky coupons and high low pricing. Mostly older folks who've shopped there a long time. That doesn't work. If it did everyone would be shopping at Sears because Shop Your Way is the best rewards program in existence. Only a handful of people will mess around with that stuff. The reason Sears wasn't successful with SYW is because its a gimmicky rewards program that largely caters to younger people who use rewards programs and the internet, but most of their shoppers are older just as they were at JCP, Macy's and Bon-Ton.
Now JCP backed themselves into a load of debt and were losing sales. I'm sure it would eventually have turned around but instead they ditched Ron Johnson and went back to the same old formula. It helped reverse things to some degree but didn't differentiate them, it was back to same old same old.
So then they decide to bring in appliances. I don't know what the precise reason but it likely had to do with Sears' issues. Except Sears was still competitive in appliances despite their struggles and had everything in place, allocated and designed to sell appliances. JCP had none of it other than the floor space to do it. They started it off in a few stores then for some unknown reason did a mass rollout. However they never really advertised it.
So they put the appliances in. They looked nice, the displays were modern and nice looking. Except no one was shopping them. The times I went there there were no customers and one associate. Soon there were no associates and an empty department.
One problem as I mentioned was lack of advertising. I saw a scant few ads for appliances. Can't sell what no one knows you have. Secondly the pricing was not competitive. Lowe's was almost always cheaper at the outset. Sears always had some of their typical gimmicks like free delivery or financing. Best Buy had better sale prices. Home Depot had better sale prices. Local places had better service because they advertised and had associates to sell the stuff.
There was simply no compelling reason to shop at JCP for appliances.
While I'd have stuck with it if I were them mainly because they have plenty of floor space I doubt appliances have enough turns that they wouldn't have gotten stuck with old models. They simply are not selling in necessary volumes to avoid it. With their questionable financial situation they probably can't afford to invest in it.
With Eddie wheeling and dealing to try and keep Sears alive and the talk of new small format stores, since he's somehow managed to keep this Sears stuff going so long if he somehow makes it last another year, two or longer those big debt payments JCP has coming were likely a factor in their decision to exit.
Had they had more money to stick with it it would have been one thing but they were out of the game too long and didn't market it well.
They need sales now. Not hopes of future sales. They don't have some rich hedge fund money manager like Fast Eddie wheeling and dealing to keep the game alive, nor the time to wait until he finally gives up on this Sears dream he can't seem to let go of. If you look at the track record of stores that were in Sears' financial situation with years of losses, almost all of them are already memories.
JCP also didn't have the luxury of having a still well known private brand like Kenmore to slap on anything they see fit.
JCP should focus on something more manageable that they're still somewhat known for like housewares, small appliances and cookware. Try and drain sales from Bed Bath and Beyond instead. Otherwise I could see them going in the same general direction Sears did but the more likely outcome isn't surviving bankruptcy even if the survival is short lived.
Rumor is JCP is reducing their appliances tomorrow. I'll be going to check it out and get pictures of their display setup because it looked quite nice.
