JC Penney discovers the "all-in shopping enthusiast", but omni-channel transformation "problems to fix" still dominate
JC Penney discovers the “all-in shopping enthusiast”, but omni-channel transformation “problems to fix” still dominate
Sun, 11/17/2019 – 21:49
- JC Penney’s CEO has determined the type of customer she needs to entice in order to transform the retailer, but digital transformation successes remain thin on the ground,
In pursuit of the Holy Grail of personalization in an omni-channel retail world, major brands have spent millions of dollars in pursuit of identifying and understanding who their customer is. Thatâ€™s never been as easy as it sounds, particularly when that customer isnâ€™t necessarily even coming into your store anymore and letting you see the color of their eyes.
For all too many brands, the result of this has been to reach for retail cliches – the Millennial customer, the GenX shopper etc. For JC Penney, still embarrassingly at the â€œthoughtful stageâ€� when it comes to digital transformation, the cliche was traditionally â€œMiddle Americaâ€�, a target demographic that frankly it lost touch with a long time ago.
That backdrop was what Jill Soltau knew she had inherited when she took on the CEO role last year and perhaps alluded to when she talked about the need to re-establish â€œthe foundations of retailâ€�. Jump forward nine months and Soltau has an update on who the JC Penney customer is and itâ€™s a new title to add to the cliche catalog: the all-in shopping enthusiast!.
What is an all-in shopping enthusiast? Well might you ask. Soltau reckons that JC Penney has done its homework here though:
We know a lot about our customer focus segment. We conducted holistic research that was broad and deep, speaking to thousands of retail consumers that included those who shop us, those who use to and those who donâ€™t even consider us. Our efforts are centered on cycle graphics and knowing what drives a customer attitudinally and behaviorally truly understanding what’s important to them.
OK, so what does drive an all-in shopping enthusiast attitudinally? Soltau paints a picture:
All-in shopping enthusiasts live life to the fullest and seeks the most out of everything. They are the most confident in their style vision, yet most open to input and expertise. They are most willing to invest the time and money to get it right. They are the most excited by choice and innovation are most connected with their family, friends and community. They pride themselves in making life happen for their loved ones.
Pretty words, no doubt, but what the heck does that mean in practice when it comes to rebuilding a shattered iconic US retail brand to compete in an e-commerce economy? Saltau says:
Learning what this customer wants and what we are not delivering is shaping our actions across all channels, so we can drive traffic and capture more shareâ€¦These are serious shoppers who respond to compelling merchandise and engaging experiences. Our research shows that the all-in shop enthusiast represents over a quarter of all home and apparel retail sales. And the good news is, they are already shopping with us. We need to deliver on what is imperative to this customer allowing us to capture more of their wallet and by getting it right, it will halo onto other valuable customer segments.
Itâ€™s an emotional experience, she adds, literally:
We need to connect with them on important emotional drivers. They told us that no retailer is consistently delivering on these key imperatives. The all-in shopping enthusiast has told us they want a retailer that reflects their lifestyle and makes them feel good about themselves, truly understands the important moments in their lives, big and small, is a place that’s fun to shop and share with others.
As we think about every element of the shopping experience, the exploration, the discovery and the purchasing in-store online and through our approximately, we are working to connect with them on these emotional drivers. We know that nearly 90% of customers begin their path to purchase online. We continue to work on our e-commerce experience to drive traffic across all channels. We are building a viewpoint of what needs to be done and customers will continue to see incremental improvements over time.
In those last two sentences lies all that is wrong with JC Penneyâ€™s strategic direction. To be â€œbuilding a viewpoint of what needs to be doneâ€� as 2019 draws to a close is not indicative of the kind of successes that should be evident from a retailer that kicked off a high profile digital transformation several years ago.
Itâ€™s complicated, suggests Saltau, arguing that retail is a â€œdynamic businessâ€� that needs to adapted to:
Our approach at JC Penney is a very holistic effort. It’s not going to be one single action that changes the trajectory of this organization. I have been very clear on that for the past year. As we think about driving traffic, whether it’s to our physical footprint or to our digital spaces, it will be through a differentiated products and services and experiences.
We need to engage with customers in new ways and develop that emotional connection that they’re saying other retailers don’t doâ€¦Doing this in-store online and in our app in addition to our physical stores is how we will return improved traffic levels to JC Penney.
The physical store aspect of the firmâ€™s omni-channel thinking appears more well-formed than the digital side:
We view our footprint in malls as a way to engage in new ways with customers. Using our space to present our merchandise with a fresh approach and provide experiences and services that customers want and are giving us permission to offer.
That said,Â there are some digital action points to be cited:
As it relates to our digital space, we are enhancing our customer experience, the user experience. We are making it easier to navigate. We are building out storytelling to drive that emotional engagement with the customer, make it easier to find what they’re looking for as well find their style.
We’ve also been working on just the frictionless and seamless effort to shop cross functionally between our digital and our physical space.,,we have a full organization focus on improving our mobile web, our website as well as our app.
Then thereâ€™s the â€˜re-commerceâ€™ initiative with online marketplace platform thredUp to pilot selling second-hand womenâ€™s clothing in 30 JC Penney stores:
We were still very early in our partnership with thredUp, which is currently in 30 storesâ€¦.We are excited about creating a new in-store experience that that makes it possible for our customers to get an expanded offering of some brands that are considered more high end for our current customer base. Our partnership with Thread up caters also to eco-minded consumers that want more sustainable options in their wardrobe. So we are in the middle of the test, things are good and we’re just going to keep moving forward with it.
Amid all the buzzword-compliant talk about â€˜all-in shopping enthusiasts, thereâ€™s one comment Saltau makes that is candid:
I’ve been consistent in the year that I’ve been in the role that this organization has a lot of problems to fix. We’ve been very overt on that and it’s both in our physical and digital space.
The CEO defines JC Penney as â€œa 117 year young American retail iconâ€�. If it wants to get to 118, it needs to start delivering more obviously on a workable omni-channel strategy that reaches beyond coming up with new names for customers.
Image credit – JC Penney