JCP's Berman Brings In New Batch of Shops to Assist Turnaround

Doner, EVB and Victors & Spoils All Tapped to Handle Marketing

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Debra Berman
Debra Berman

Less than three months after JC Penney named former Kraft Foods exec Debra Berman to lead the retailer's marketing strategy, she's brought in a whole new agency team, including Doner, EVB and Victors & Spoils, to step up the company's advertising.

Their first order of business? A holiday campaign.

Ms. Berman, senior VP-marketing, said she determined in September that the holiday marketing plan presented by WPP's Y&R was not "sufficient to build the relationship we want to with our customers." So, she called a whirlwind agency pitch -- it lasted just three weeks -- and invited a select number of contenders. In the end, the campaign idea presented by Southfield, Michigan-based Doner won over the J.C. Penney team.

Doner will handle integrated marketing, including TV and radio executions, while San Francisco-based digital shop EVB and Boulder-based crowdsourcing firm Victors & Spoils will handle social efforts and grassroots marketing. MDC Partners has a minority stake in Doner. Omnicom Group owns EVB and Havas owns Victors & Spoils. In an unusual move for agencies with different owners, EVB and Victors & Spoils pitched the business together.

The appointment of the trio of firms means WPP's Y&R is getting edged out of the picture after just months working on JC Penney's account. Ms. Berman said the agency was "incredibly gracious," noting that the leadership team there was involved as JC Penney handpicked shops -- in addition to the trio of winners, CP&B and DDB participated -- to participate in the swift pitch.

"There was extraordinary collaboration, in and out of this building. [The agencies] spent a lot of time in our stores with our associates. ... They all felt this is the kind of marketing challenge that you're proud to be invited to take a look at," said Ms. Berman, who is well acquainted with the agency space.

Doner familiar with turnaround situations

Before jumping over to the client side to work at Kraft in 2009, she worked at a number of ad agencies, in media, planning and account executive roles. Among them were JWT, Saatchi & Saatchi and DDB. She also spent time at Y&R.

By appointing a new group of external marketing partners, Ms. Berman is putting her stamp on the company -- though she noted an agency review wasn't a condition of her hiring. Y&R was brought on board in April by Sergio Zyman, who worked with the retailer in a consultant capacity beginning last year, under then-CEO Ron Johnson. Mr. Zyman is no longer consulting with the retailer.

Ms. Berman pointed out that, having worked with Chrysler, Doner is intimately familiar with turnaround situations. "I've never hired Doner directly before -- I know some of the talent at Doner," Ms. Berman said. "I was really attracted to their simplicity and strategic thinking and their connection to our customers. There was no gap whatsoever in understanding that target."

For Doner, JC Penney will immediately become one of the best-known consumer brands on Doner's roster, along with the Chrysler Group. The agency's roster also includes accounts such as the UPS Store, AutoTrader.com, Things Remembered, ADT and Sherwin-Williams.

But, it's an account that will also test the agency's abilities.

"JCPenney is one of the great American companies, and we are ready to roll up our sleeves to help this storied brand reconnect with its core audience, drive store traffic and build loyalty," said David DeMuth, co-CEO and president of Doner.

JC Penney has been battling negative headlines for months. Most recently, it came under pressure amid liquidity concerns, and its stock price plummeted. Last week its stock fell to levels not seen since the early 1980s. Ms. Berman addressed that, noting "there is no pressure on marketing budgets, and we are spending in line with what it takes to develop the business."

This morning the retailer provided an update on the status of its turnaround, noting September comparable sales showed signs of improvement, while sales on jcp.com were up 25%, on top of an 11% gain in August. The release also noted the retailer has plenty of cash on hand and is working to right its ailing home business. Customer-service scores are at an all-time high, the company says.

Restoring faith and footsteps

The holiday season will be critical as the retailer looks to attract lapsed customers and prove to investors and analysts that it can -- and should -- continue to exist.

"The critical thing in a turnaround related to marketing is traffic, and we say our first, second and third objective is traffic. So these agencies are acutely aware of that," Ms. Berman said. "There's no friction between this is branding and this is promoting. It's all about a broad tool kit that does both, because that's what the business challenge requires to restore faith and footsteps in JC Penney."

Despite the fact that new agencies are coming on board less than two months before Thanksgiving, Ms. Berman said she's confident the team will be ready.

"A byproduct of having so much leadership turnover is that I'm not sure I've ever experienced a more agile team or a more well-fused marketing team," Ms. Berman said, noting the new agencies will work closely with J.C. Penney's internal creative teams. "There are a lot of yes-I-can folks around here."

JC Penney's marketing plans, in terms of air dates have not changed, Ms. Berman added. In fact, holiday marketing, including a "very robust" promotional schedule, will kick off two weeks earlier than planned. Ms. Berman declined to say when that launch date would be, noting only that it's within the "traditional window." Ellen DeGeneres will not be featured in holiday creative, as she was a year ago, but a spokeswoman said the retailer continues to work with the talk-show host on integrations around her show.

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