On April 18th, Nick Wooster resigned from his position as SVP of Product Development at JCP (formerly JC Penney's). This happened a week after Ron Johnson (who hired Wooster) resigned as CEO. During their 16 month tenure, sales tumbled 32%.
Wooster gave WWD an honest quote on how the company could gain back the customers it lost: ".... make cute shit." Can't blame the guy for cutting to the chase right?
So what went wrong?
In my opinion, this can be summed up in two broad hypotheses that I'll try and detail out:
1. The company rebranded its image without changing its product offering.
2. The company confused its core customers with inconsistent messaging.
Listen, the rebrand was fine in my opinion. I actually like it. It's a little too similar to the GAP rebrand fiasco a couple years back but, in general, it does a good job of keeping the core values of the brand (especially since they're HQd in Texas) but also making it not seem too fashion-forward. I don't really see this hurting their image and think it will actually help them in the LONG run.
Johnson & Wooster
Sounds like an evil law firm right?
JCP hiring Nick Wooster to helm Product Development was the equivalency of Sears hiring a fashion blogger to run their Product Development. Oh wait... no that's exactly what happened. I don't know the semantics involved in Wooster's position and/or if he was hired as a figure head or he was actually making critical cost-analyzed decisions but I doubt the latter. I don't doubt his ability to trend forecast for a second but 16 months went by and the only thing that changed at JCP was how the brands were advertised; not the ACTUAL brands. Therein lies the blunder.
Nick Wooster will take a lot of heat and association with the changes done in how they advertised the brand but the fact is that I reckon he had very little influence in the overall communication strategy. I credit Johnson for that. And the sad thing is that I LOVED it.
Check out the results of Johnson's communication rebrand below:
Awesome right? Truly remarkable, beautiful, engaging, soul-touching, fashion-appropriate, lifestyle appropriate. This COULD have worked.
Why didn't it work then?
That brings us back to Nick Wooster and his responsibilities.
If you're going to rebrand your image from top to bottom, then you HAVE to alter the product offering. As engaging and exciting as these ads were, it must be recognized that the advertised brands were IZOD, MNG by MANGO, LIZ CLAIBORNE and LEVIS. Wooster either had his hands tied or he simply failed to convince better retailers to jump on board.
Why did they lose 32% of their customer base?
Take a look at this ad below that was released on February 24th, 2013 entitled "Dear America"
Now take a look at the ad below released on April 11th, 2013.
The above ad is titled "Dear Smart Shopper". Super interesting right?
Here's the key things to look at in these videos:
- It's the same footage from the same shoot.
- Dear America has no prices in it.
- Dear America has no friendly lady talking behind it.
By REMOVING pricing and value from their advertising, they lost a majority of their core customer base. This is pretty obvious to me and it, honestly, should have been anticipated to some degree by senior executives and strategists.
What should / could they have done?
As I stated above, they should have anticipated that they would lose a large portion of their core customers. Companies who go through this severe of a rebrand need to be able to back it up with an updated product offering. I don't really see any scenario where JCP would be able to secure the same retailers as Barneys or Neiman Marcus but they really needed to secure at least a couple more style-forward / fashion-forward retailers in order to attract a new customer base. Even though The Shoppes at Target and H&M Collaborations are growing tiresome, it could've worked at JCP (and with a better partner than Liz Claiborne).
In the least, they could've saved themselves a lot of headaches by easing into the rebrand instead of ripping the bandaid off.
What can other brands learn from this?
Plain and simple, know your audience and fully recognize the risks. Detailed:
- If you're going to rebrand, make sure that you have good reason to and that it is for the betterment of your company.
- If you're going to drastically change the messaging and branding of your company, critically consider if you need to change your product offering as well.
- If your marketing and advertising communication has been focused on value and sales based efforts, know that deviating from that will result in immediate and drastic sales dips.
- Don't hire fashion bloggers as SVPs of anything.
Thoughts or comments? Leave em in the comment section or email me at email@example.com.