JC Penney Adds Sales Promotion Back Into the Marketing Mix

Wall Street Cheers CEO Ron Johnson's Latest Adjustment to Pricing Strategy

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JC Penney finally got a little love from Wall Street after it said it would resume holiday-related promotions, beginning with Valentine's Day.

The stock soared the most it has in four months after the department-store company made yet another adjustment to CEO Ron Johnson's pricing strategy.

Credit: Bloomberg

Mr. Johnson, Apple's former retail chief, has eased up on his everyday low pricing model after the company's revenue fell at least 20% for the past three quarters. JC Penney will hold sales on popular items tied to "key events and holidays" such as Valentine's Day, Easter and Mother's Day, said Kate Coultas, a company spokeswoman. There will be fewer than 100 of the events, compared with almost 600 unique promotions in 2011, she said.

That follows on the announcement in November that JC Penney would add suggested retail prices to merchandise so customers can see how much they're saving and will match discounts on national brands such as Jockey when they are running sales.

The company has also been sending e-mails to customers alerting them to clearance merchandise and has worked to win back shoppers through offers such as a $10 in-store coupon, 30% discounts off clearance items, free children's haircuts and free family portraits.

"We continue to believe in the importance of great everyday value," Ms. Coultas said. "It has been and will continue to be the cornerstone of our pricing strategy. Every time a customer walks into our store, they can take advantage of low everyday prices."

Ad Age earlier this year predicted 2013 would bring a return to sales for JC Penney, in order to appease analysts.

~~Bloomberg News~~

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