JC Penney shares plunge after president quits
Michael Francis, a key member of the 'dream team' the retailer assembled to transform its operations, is leaving just months after his arrival.
By MSNMoney partner Jun 19, 2012 12:07PM
Reuters
Shares of J.C. Penney (JCP) slid 11% Tuesday after its president abruptly left the department store operator after a botched advertising campaign that was a linchpin of the 110-year-old chain's turnaround plans.
Penney said on Monday that Michael Francis, a key member of the "dream team" it assembled to transform the company's image, merchandising and pricing, was leaving just months after he joined from Target (TGT).
Post continues below.
"The turnaround envisioned in January has not gained traction, and the company has made basic mistakes such as introducing 'branding' marketing before the product (or) stores had changed," Nomura analyst Paul Lejuez said in a client note.
"Francis may be taking the blame for the marketing mistakes. Alternatively, maybe Francis is giving up on a turnaround plan he helped create."
CEO Ron Johnson, who took over in November after coming from Apple (AAPL), acknowledged last month that Penney's ads had not clearly explained to shoppers a shift in its pricing strategy, central to its turnaround efforts.
Penney's ads have been criticized for confusing shoppers and not focusing on product and prices.
Copyright 2012 Thomson Reuters
Shares of J.C. Penney (JCP) slid 11% Tuesday after its president abruptly left the department store operator after a botched advertising campaign that was a linchpin of the 110-year-old chain's turnaround plans.
Penney said on Monday that Michael Francis, a key member of the "dream team" it assembled to transform the company's image, merchandising and pricing, was leaving just months after he joined from Target (TGT).
Post continues below.
"The turnaround envisioned in January has not gained traction, and the company has made basic mistakes such as introducing 'branding' marketing before the product (or) stores had changed," Nomura analyst Paul Lejuez said in a client note.
"Francis may be taking the blame for the marketing mistakes. Alternatively, maybe Francis is giving up on a turnaround plan he helped create."
CEO Ron Johnson, who took over in November after coming from Apple (AAPL), acknowledged last month that Penney's ads had not clearly explained to shoppers a shift in its pricing strategy, central to its turnaround efforts.
Penney's ads have been criticized for confusing shoppers and not focusing on product and prices.
Copyright 2012 Thomson Reuters