Image courtesy of JCPenney
Is JCPenney’s First New Store in 8 Years a Good Sign?
After an eight-year hiatus, JCPenney is making a bold return with the grand opening of its newest store in Wayne, New Jersey. Situated in the bustling Willowbrook Mall, this two-level, 120,000-square-foot space marks a significant milestone for the iconic retailer.
Gone are the days of cluttered aisles and outdated decor. JCPenney’s fresh approach embraces modernity with a sleek, open floor plan spanning 65,000 square feet of retail space. Customers can expect enhanced sightlines, centralized checkouts, and dedicated areas for pickups and returns, which may improve the overall shopping experience.
This new venture is part of JCPenney’s ambitious strategy to revitalize its 121-year-old brand. Following its emergence from bankruptcy in 2020 under the ownership of Brookfield Asset Management and Simon Property Group, the retailer announced a $1 billion investment plan to overhaul its stores, enhance online capabilities, and streamline its supply chain.
JCPenney’s ambitious reinvestment program aims to modernize both its physical stores and online presence. The plan involves updating all 650+ stores with improved aesthetics, technology, and infrastructure. Upgrades include a new point-of-sale system designed to seamlessly integrate with inventory as well as enhanced Wi-Fi networks for faster and more reliable connections.
In a nod to contemporary retail trends, the store also features movable fixtures, allowing for seamless adjustments based on evolving consumer preferences. Enhanced lighting and strategically placed mannequins elevate product displays, creating an inviting atmosphere for shoppers to explore.
One standout feature is the rotating shop showcasing home and holiday items on the first floor, providing a sneak peek into JCPenney’s extensive home assortment on the second floor. The retailer is also shining a spotlight on its private label brands, with upgraded presentations that underscore its commitment to quality and style.
JCPenney’s latest venture into the retail world has left analysts pleasantly surprised. The new location at the Willowbrook Mall marks the first expansion since 2016. However, it replaces an older store nearby, so it doesn’t add to JCPenney’s total number of locations.
The opening celebration welcomed guests like New Jersey State Senator Kristin Corrado and Wayne Township Council President Jason DeStefano. Additionally, JCPenney demonstrated its commitment to community support by donating $11,250 to the local chapter of the Boys & Girls Club of Northwest New Jersey.
DeStefano commended JCPenney’s longstanding dedication to Wayne, recognizing its involvement with local initiatives such as the YMCA and the Boys & Girls Club. Senator Corrado praised the quality merchandise and exceptional customer service offered by JCPenney, emphasizing the company’s positive impact on the community.
The opening weekend exceeded expectations, with sales surpassing targets by 48%, making it the second-highest performing location in the company. Moreover, over 50% of transactions were made using a JCPenney credit card, highlighting customer loyalty.
The revamped store promises customers a fresh shopping experience with a smaller footprint, a carefully curated selection of merchandise, and a conveniently located salon and beauty section. Michelle Wlazlo, JCPenney’s chief merchandising officer, expressed enthusiasm about the new store concept. “The new JCPenney store concept in Wayne, N.J. is bringing a refreshing new take to the in-person department store shopping experience,” she said. “We are dedicated to making the in-store experience more inviting and productive for the diverse, working families we serve.”
Department stores, once thriving hubs for shoppers, have faced challenges in recent years due to the rise of online shopping. JCPenney, a stalwart in the industry, has managed to stay afloat alongside Macy’s and Nordstrom, but recent data suggests troubling trends for the retailer.
According to a financial filing with the SEC, JCPenney reported a significant decline in net sales and total revenue during the third quarter of fiscal 2023. Net sales dropped by 10.7% to $1.5 billion, while total revenue fell by 11.1% to $1.6 billion compared to the same period in 2022.
The company attributed this decline to ongoing “macroeconomic challenges,” impacting both sales and the credit card component of the business. Despite strong credit card approval rates, factors like declining late fees and rising losses contributed to reduced credit income.
JCPenney did see positive results, however, from its $1 billion strategic plan, “Make It Count,” implemented last September. The initiative boosted digital sales, store traffic, and customer engagement. Average customer sales increased by 11%, reflecting customer confidence in product value. The reintroduction of national brands and margin improvements in private brands contributed to higher merchandise gross profit. Inventory decreased by 12% compared to last year.
Already, more than 100 stores have undergone refreshing updates.
Discussion Questions
How might traditional department stores effectively blend physical and digital elements to compete with online shopping while still delivering an engaging in-store experience?
What innovative strategies can struggling retailers adopt to revitalize their brands in the face of changing consumer preferences and market dynamics?
As JCPenney invests in advanced technologies and enhancements, how can it ensure a balance between efficiency and emotional resonance in the shopping experience?
Poll
Loading …BrainTrust
Neil Saunders
Managing Director, GlobalData
Dave Wendland
Vice President, Strategic RelationsHamacher Resource Group
Worst things first: there’s a lot to not like about this: the operations-savy among us will note the small proportion of selling space/total g.s.f (apparently this has more-than-little to do with its last stint as a Lord and Taylor; indeed, according to retail*******s, this location has morphed thru enough name plates to suggest a jinx). Next: the fact that so little remodeling was done suggests they’re operating with a thin budget (which brings a mixed reaction of relief that they’re probably not overextending, but concern that what they’re not overextending may not be enough to do much). And finally: a lot of us are probably thinking “and…?” as in What kind of company doesn’t open a new store for eight – count’em e-i-g-h-t – freakin’ years?
And now for the likeable part: one store isn’t much, indeed, one store is only better than no (store)openings at all. But – for the first time in a long, long while – we don’t have to rationalize the worst having come to pass. I wish them well.
This is a good sign inasmuch as it shows JCPenney is trying to revitalize its business. Many of us, especially me, are critical of the lack of investment in department stores and the poor merchandising standards that greet customers. It would be churlish not to recognize a retailer that’s at least making at effort to move the dial. My concern, however, is not with this one store – it’s with how JCPenney revitalizes the rest of its chain. A billion dollar investment is significant, but it doesn’t stretch that far across 650 shops; there is a danger that the changes will be cosmetic adaptations that simply bring JCP to where it should have been several years ago. But any long journey much begin with a single step, and I guess this is JCPenney’s. I will be walking a store with JCP management next week and I am excited to hear about their plans in more detail.
Agreed. Refreshed space without an investment in people and their merchandising skill sets won’t matter much in the long run.
I agree with this. We have discussed JCP at length several times, and the although the investment is substantial, the whole chain was already supposed to be refreshed some time ago. Is this model to used moving forward? What is the key differentiator in this store that will bring customers back to the chain? How has the merchandising changed for the better? Lots to consider and I hope the rest of the company can be upgraded in a quick manner with the appropriate investment in capital, marketing, etc.
Interesting and certainly hope this is the beginning of something good for JCP, but it is only one store. I’d want to see a trend of these opening, doing well, and growing to feel more assured of future success.
I have to congratulate JCP on their approach here. They took an older format store and worked with a constrained budget in order to modernize the store and the shopping experience. That’s the challenge…100’s of stores and a constrained budget. They had to execute a prototype that demonstrated a new approach, that worked, AND was scalable. Scalable…100’s of stores. But budgeting a billion $$$ over 100’s of stores is actually the easy part. Next comes new planning, new buying strategies with new content, new visual merchandising. A lot of old thinking and old momentum has to be addressed. That’s the hard part. Breaking the inertia of old habits and putting new thinking into place across the whole merchandising organization. Sounds like this one store is off to a good start.
And by the way, walking a new prototype store with Neil Saunders is maybe the bravest thing a retailer could do. It means that JCP is in hardcore ‘listen & learn’ mode. I wish them well. The mid-tier market needs a win.
I believe this is less about the viability and strength of the JCPenny brand and more about strengthening the shopping center’s brand and tenant appeal. When JCPenny was bought back in 2020 by the country’s largest shopping center operator, Simon, and their partner Brookfield, the Brain Trust consensus at the time was that the purchase was a strategic play to shore up the anchors in centers across the country. This development confirms that assessment. It gives Simon and JCPenney a place to try things and test the viability of the brand, and its strength and viability as a mall anchor.
I wish them well, but honestly the issues with middle-market department stores are much larger than just one brand or one new store.
While commending & wishing JCPenny well with its new initiatives, I question whether its planned $1 billlion strategic plan spread across 650 stores & online will be sufficient to return the brand to its glory days. Retailing’s transformation brings challenges to JCPenny & others that will require significant dynamic innovation beyond a one store development.
I don’t know if $1Bil is enough either but more so how soon can I get this done to move the needle as a company?>
After many missteps and management changes over the past 15 years, JCPenney is still not at the point of survival that its most recent owners are hoping for. Its 2023 sales fell to under $8 billion, its net income for the year fell by 36%, and year-end inventory rose by 11%. None of these metrics feels sustainable, and JCP has simply lost its relevance.
Replacing an old store with a new location is never a bad idea, if the new site allows for fresher merchandising and presentation. But does JCP really have the capacity to roll out whatever it learns to its remaining portfolio of stores? If JCPenney announced the takeover of dozens of Macy’s sites, that would be a real growth story.
One store does not a “bold return” make. This article reads like a press release for JCP. Put in somewhat less breathless prose, let’s see what they are actually doing. They have 120,000 sg. ft. store, but only 65,000 sq. ft. of selling space. They have technology “upgrades” that bring them up to a minimum best practice retail technology level. And, while $1 billion sounds like a lot of money, retail folks know that isn’t all that much when you start spreading it over 650+ stores. Finally, the numbers don’t look good. How much of that “sales increase” is due to inflation and how consistent will performance look moving forward? I wish JCP all the luck in the world, but it will take more than luck and one new unit to turn things around longterm.
Not only is this not an addition to the store count, but this is a replacement store for the one shuttered across the street. I will take a wild guess and say there is a net loss of square footage from the original store.
True. I remember a short time ago, Sears did the same thing, but I don’t see where that moved the needle.
Kudos to JCPenney for efforts to revitalize the brand, the store, and consumer appeal. I agree, however, with many of my fellow commentators, one store does not a recovery make. The entire chain needs resuscitation and I’m not sure if shoppers are willing to wait (or rediscover) that.
First of all, this is not a new location. It’s relocated from across the street. Second, it fills a 4 year hole left by the departure of L&T. And guess what? It’s a mall owned by Brookfield. It’s also a WAY smaller store than is typical. At 65,000 square feet it’s now a box that would be much more leasable to an alternate tenant (Primark anyone). What this says mostly is that their owners are committed to keeping A locations of JCP afloat of at least a couple of years. Beyond that this is mostly a PR move that helps a blight on the Brookfield portfolio.
Yes, this is all about real estate, little or nothing about retail, and certainly not a sign of a comeback. Empty stores kill a mall. This is Simon’s fix.
I hope the results are good. I’d like to see a resurgence of in person shopping as it has societal benefits as we are turning into mushrooms ordering from Amazon in our t-shirts and pajamas. I assume the location was also chosen as presenting a low crime risk.
Don’t throw the JCP obituary away. There is nothing here that smacks of resurrection. Simon Properties is simply filling an embarrassing anchor spot at a key property. It isn’t even a net add of a store as they shuttered the JCP that was across Rt. 46.
JCPenny has always been an iconic retailer. However, the past decade (or more) hasn’t worked well for them (and many retailers). I see this new store, its contributions to the local community, and its investment in technology as an experiment. I’m sure they have done their due diligence and determined the numbers are probably in their favor, minimizing the risk of failure. Now, it’s time to see if it works.
I’m encouraged (mainly for employee and the Wayne, NJ community) to see this change for the better. I’m less confident that it will be spread throughout the chain in time to resuscitate JCP.
I wonder if the new store will have as many employees as the one it is replacing.
Department stores are dead dead and dead. Very few will survive. I hope I am wrong, but this ship has sailed. We are in an age, when, say, Harrods will probably be a thing, maybe Harvey Nichols, but Belk? Macy’s? JC Penny? Maybe a short resurgence will happen but this category is finished.
JC Penney’s recent efforts to remodel and open a new store in Wayne, New Jersey, indicate their commitment to improving the customer experience through a mix of digital and physical enhancements. This includes implementing modern technology like mobile apps and click-and-collect services, alongside creating engaging in-store experiences that resonate with today’s shoppers. It also means staffing shops with engaged help
However, it’s important to recognize that this is just one store’s renovation out of many that will need similar attention. The real challenge lies in whether JC Penney can regain consumer interest and trust across all their locations, considering the brand’s struggles in recent years. To upgrade an entire chain will take significant capital investment. Will it be enough to win the customer back? If the payoff does not meet expectations, will leadership stay the course? The effectiveness of these initiatives in rekindling customer loyalty and attracting new patrons will be critical in assessing the potential resurgence of JC Penney in the competitive retail market. The journey of transformation is underway, but it remains to be seen how the consumer base will respond on a larger scale.
Well, I Like JCP, Full Disclosure, I Shop JCP, I persoanlly like their Stafford brand. I WISH them the BEST! This IS however ONE store. Let’s hope that all the “Not floor space” is being used as fulfillment for BOPIS, Or Local delivery stock??? I Do Applaud them — Willowbrook is a nice mall and hopefully this store will do well and can go into the future. Hopefully they will learn some things that they might be able to uplift the shopping experience in their other stores. Most stores need updating and refreshment. This problem is certainley NOT related to JCP alone! I do think they deserve credit for trying! (This also by the way is a Brookfield Mall!) Thanks All!
To effectively compete with online shopping, traditional department stores must seamlessly integrate physical and digital elements. This entails offering omnichannel experiences like Buy Online Pick-Up In Store (BOPIS), interactive digital displays, and mobile apps for personalized recommendations.
Additionally, these stores can create engaging in-store experiences through events, workshops, and immersive product demonstrations. Retailers who might be struggling at the moment can revitalize by rebranding with a modern touch, collaborating with popular influencers, and introducing exclusive product lines.
For JCPenney, striking a balance between efficiency and emotional resonance means leveraging advanced technologies like AI for streamlined operations while maintaining human touchpoints like personalized service and community involvement to foster meaningful connections with customers.