Branding A Business: The Lessons We Learned From JCP’s Failed Rebranding Effort

In less than shocking news, Ron Johnson was recently ousted as CEO of J.C. Penney after a continued decline in recent sales.  Johnson came into JCP during one of the worst times for the company.  He had hoped to rebrand the retail chain in order to have it come back as a successful store, but his tactics failed to cause a turnaround in profits.

ronjohnsonLast year, when Johnson rolled out his first series of changes, we recorded our opinions and predictions.  Now that Johnson has been let go by JCP, we have noted a few things that are crucial for rebranding initiatives that Johnson seemed to leave out.

1. Research, Research, Research

The key to a successful branding is complete research.  This means analyzing the company, the consumers, the competition, and the market.  After collecting all there is to know, a company can decide on the most successful strategies to be implemented.  Most of JCP’s rebranding woes could have possibly been predicted according to their current consumer trends.  JCP severely underestimated the backlash of ditching their coupons for the value pricing system.  The company learned almost immediately how important the promotions were to current customers, which is something sales records could have demonstrated.  When in a crisis, companies should always evaluate what is working for their company versus what isn’t.  The backlash on the pricing policy change has lead us to question the validity of the research that was completed.

2. Consumer Testing Is Key

Customer is king.  If the customer does not like the strategies you are using, it will bleed through into your sales.  Consumer testing helps a company try out some of their newest tactics and get some feedback before rolling out anything to the wider market.  Judging from consumer reactions, Johnson skipped this step.  Customers were immediately annoyed by the new television commercials, and posted their negative almost immediately. jcplogo

3. Make Sure Everyone Is On Board

According to various reports, Johnson was always very mum on changes to come.  Only a few select people would know what was next for the retailer.  However, branding, by definition, is about sharing with the public the culture that is alive inside the company.  That means that every employee has to be on the same page, providing a united front in what the brand stands for.  But, with Johnson keeping everyone in the dark, workers did not know what their next attitude change had to be.

Where else did Johnson fail in his rebranding?  Or what were some of his successes?  Tell us your takeaway in the comments, and on our Facebook & Twitter!


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