Ron Johnson and the Three Ds

In Customer Connections, Management Connections, Uncategorized by Shannon Alter0 Comments

Mercifully, it isn’t a singing group. Ron Johnson’s departure as J.C. Penney’s CEO does bring one thing to mind: if you can’t connect to your customers, not much else matters.   Did he make changes? Yes. Was he quick? Absolutely. Did Penney’s customers sail along with the changes? Definitely not.  This turn of events makes me think of what I call The 3 D’s.

You know the story. When times are tough, we’re tempted to take retailers we might otherwise decline, just to fill our vacancies.  When times improve, we are hopefully able to think more strategically about our center’s tenant mix. We’re rethinking retail. The trick is, we’ve got to get our retailers to rethink it too. Hence, my 3 D’s for what  retailers must accomplish:

Develop their target market and customer profile:  If you’re not sure how important this is, and how exact it needs to be, take another look at Ron Johnson’s experience. Did J.C. Penney’s customers really long for edgier apparel and free kids’ haircuts? True, some customers applauded Penney’s plan to turn its standard floor plate into a desirable avenue of shops, but they weren’t the only ones who got more than they bargained for.

Determine the right price: Gone, gone, gone. That’s what happened to J.C. Penney’s sales. Not only did their sales volumes decrease a whole lot (an estimated 28% for Q4 2012) but the actual, physical store clearance sales that Penney’s customers knew and loved disappeared. What’s the key here? I can answer this one in 3 words: Customer Connection Counts.  Of course, it’s imperative for a retailer to know its competition inside and out. But it’s that customer connection that makes the difference for all of us.

Deliver stellar customer service:  Some things never go out of style. Or do they? It’s always seemed strange to me that when times are down we struggle to make–and keep– that customer connection we worked so hard to establish in the first place. As one colleague so succinctly described it,  sometimes we’re guilty of acting merely as “operators”, leaving connections to go by the wayside.

It may be too soon to determine what J.C. Penney’s outcome will be, but I’m sure you’ll agree that rethinking retail deserves some thought. If you’d like tips on how to merge enterprise and experience, stay tuned for my upcoming article, “When All the World’s a Mall”. 

 

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