J.C Penney’s stock tumbles after key exec’s abrupt exit

“J.C. Penney’s shares are tumbling a day after the department store chain announced the sudden departure of Michael Francis, a former top Target executive brought in last October to help redefine Penney’s brand,” Anne d’Innocenzio reports for The Associated Press.

“Penney’s terse statement Monday gave no reason for Francis’s exit. As president, he was responsible for marketing a new pricing plan that the company says replaced hundreds of sales events per year with lower prices overall as of Feb. 1,” d’Innocenzio reports. “Francis also oversaw merchandising and product development and played a big role in signing up new brands as part of larger plan to transform the company under its new CEO, Ron Johnson.”

d’Innocenzio reports, “The departure is the latest sign of tumult at J.C. Penney, which last month reported a bigger loss than expected and a 20 percent drop in revenue as shoppers fled in confusion over the new pricing strategy, which Johnson spearheaded. During presentations at a recent industry conference this month and following the first-quarter earnings report, Johnson continued to back his pricing strategy, saying the problem was that Penney’s marketing didn’t clearly spell it out. ‘Our marketing, while it is gaining a lot of mind share, is not doing the work it (must) to communicate our pricing strategy and to drive our traffic,’ Johnson told investors last month. With Francis’s departure, Johnson, who came to Penney from Apple Inc., will assume direct responsibility for and oversight of marketing and merchandising.”

Read more in the full article here.

MacDailyNews Take: The current situation makes you wonder if Johnson’s prior success was more about the extraordinary products he was given to sell by Steve Jobs, Jony Ive, and Tim Cook than with his innate retailing abilities.

While we’re not ready to give up on him just yet, there no denying that, so far, Johnson’s reign at Penney’s has been Elopian.

Related articles:
J.C. Penney reports loss and plummeting sales in 1Q – May 15, 2012
Why Ron Johnson left Apple to head JC Penney – April 30, 2012
J.C. Penney lures another executive from Apple – April 26, 2012
Steve Jobs’ ex-lieutenant Ron Johnson adds $1.5 billion to J.C. Penney in two days – January 30, 2012
J.C. Penney CEO Ron Johnson: What I learned building the Apple Store – November 21, 2011
New J.C. Penney CEO Johnson hiring former Apple co-workers – November 9, 2011
Why Apple’s retail genius Ron Johnson is paying for the privilege of running J.C. Penney – June 15, 2011
Apple’s retail store chief Johnson off to J.C. Penney; expected to become CEO within months – June 14, 2011

43 Comments

  1. Basic lack of understanding of the J.C. Penney shopper … My wife works in the industry and what the target Penney’s shopper want is to fine ‘the deal’ (not have it given to them through every day low prices). Yes they want value, but they also don’t mind working a little for it. For them, part of the process is finding the deal and then bragging about it.

    MDN readers are for the most part not the typical or target Penney’s shopper. I understand why the appeal of acceptable quality products at ‘every day low prices’ would appeal to some , it just isn’t the target shopper Penney’s is trying to reach.

  2. If Johnson thinks he can turn Penneys into Nordstrom, I fear he has a long road ahead of him. At least when Jobs came back to Apple in the 90s, Apple still had some of its legacy intact as an innovator. What does Penneys have for a legacy? The only thing I can think of is that it is not Walmart or Sears. Hard to built a premier shopping experience from that foundation.

  3. Everyone focuses on the price thing. How do you know the everyday price is so red hot? You don’t. What the liberal press fails to note is that the decline in sales to long time customers took a major hit when Penny became Gay C Penny and hired Helen DeGenerate to be their spokes person. While all that might go over fine is San Francisco, it went over like a lead baloon in Kansas. I tore my Penny card in half and gave the store manager a momento of my last visit to Penny. I now go to Khols instead since they have a similar product line but don’t rub gay marriage in my face.

    1. Nice rant BIGOT.

      Might as well leave the Apple platform, the CEO is gay and the corporation provides benefits to same sex couples..It’s all a conspiracy to turn you gay. Idiot..

  4. Why give your customers real overall savings when you can sucker them with hundreds of narrow sales events per year?

    If J.C. Penney’s customers want to be robbed blind by sales/marketing people, then they get what they deserve.

  5. Jobs would never had let Johnson run the Apple Stores if the man was not incredibly smart and talented. The problem, I think, is that smarts and talent are often non-fungible – the same qualities that allow one to excel in one setting and surmount one set of challenges, can end up offering no particular advantages in others. Johnson’s retail approach works very well for unique, outstanding products and for customers who value effectiveness and simplicity over cheapness. That’s not really the place JCP is or can be, however…

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