Is JC Penney faking its prices?

After taking a stand against phony pricing last year, the embattled retailer is reportedly asking suppliers to concoct 'fake' prices to make discounts look better.

By Aimee Picchi Jan 24, 2013 4:02PM

Customer Service counter at the J.C. Penney store in Westminster, Colorado on February 20, 2009 ( RICK WILKING/Newscom/RTR)Just a year ago, J.C. Penney (JCP) had a bold marketing plan: vanquish "fake" prices and offer simplified pricing that would do without markdowns and sales. 


But a new report says the retailer is still faking -- and this time around, it's allegedly playing the same old mind games that it disavowed. 


Penney is reportedly asking some manufacturers to make up "phony suggested retail markups" for their clothing, reports the New York Post.


Then, to give shoppers the perception of hitting upon a bargain, Penney's stores reportedly tag the clothes and accessories with the chain's own lower prices, the Post reports. In one hypothetical example of how the strategy works, a table with sweaters might have a sign reading $30, but the price tags on the clothing could read $22.


One thing's for sure: J.C. Penney is under a lot of pressure. 


Doubts are swirling about the company's turnaround plan, with UBS analyst Michael Binett earlier this month saying he expected same-store fourth-quarter sales to drop 28%. The company is expected to report fourth-quarter results on Feb. 27. 


Penney is asking manufacturers put in writing the suggested retail prices, to ensure it can back up pricing claims, according to the Post. Penney officials didn't respond to the newspaper's requests for comment. 


CEO Ron Johnson, a former Apple (AAPL) executive, has bet the retailer's turnaround on a "fair and square" pricing strategy. The company debuted splashy ads featuring Ellen DeGeneres making fun of marketing gimmicks.


So far, it appears shoppers aren't buying it. 


Revenue has declined by more than 20% for three straight quarters, while the stock has slumped 47% during the past year.


More in moneyNOW

Tags: Retail
292Comments
Jan 24, 2013 7:31PM
avatar

I guess its simply a matter of "if its worth it to you" then it is worth it to you.  If you think its a fair price, then go for it.  If not, then shop around.  Yeah, some of it is worth it.  Other stuff, maybe not so much.  Its a "buyer beware" situation in the end. 

 

I love their jewelry department, but have had to have several pieces repaired due to cheesy clasps and latches, and chains breaking, etc.  But things like jeans, that are name brand, they are the same.

 

Got some pjs and robes there at Christmas, which don't need to last forever, or be name brand.  They are great. 

Jan 24, 2013 7:28PM
avatar
one problem, pennys stoped catalogs losing i guess many of us who shop that wat, like sears losing their catalog. if these former megagiants continur to screw up, theres walmart, trget u know
Jan 24, 2013 7:25PM
avatar
This isn't new. I worked part time at JCP in the 70s. For the holiday sales, we'd take $20 shirts and mark them 2 for $50 on a table and they'd sell like hotcakes! JCP stopped caring about customers and service waaaaay back. I don't shop there at all anymore, and would recommend no one else should!
Jan 24, 2013 7:24PM
avatar

I occasionally stop at J C Penny but seldom purchase anything there.  In the past, I liked going to J C Penny for both quality and price but they do not seem to be the same company they used to be.  I always felt that J C Penny stores were clean and bright with a half decent selection available.

 

If this story is true, then the end of J C Penny is near.  I see this practice all the time on Amazon and E-Bay and I think that stinks.  I want to not only feel that I am getting my money's worth but I have been dealt with fairly.

Jan 24, 2013 7:24PM
avatar
Even so,  JCP was much more reasonable from my online experience at Christmas than Macy's with Kohls second inline.
Jan 24, 2013 7:20PM
avatar
I don't understand?  I read all these negative comments and I was just at JC Penny and bought a nice shirt and pants.  Are people trying to destroy Penny for something?  It's a good store. 
Jan 24, 2013 7:15PM
avatar
What else is new? Every time you turn around the consumer gets railroaded. You get so tired of the games and the so called sales. Maybe these company's should start focusing on the consumer, realizing that we're not a bunch of idiots.  It's all about the mighty dollar and how deep  these company executives pad their pockets. The clothing is made so cheaply. I especially hate socks that turn around every time you walk and the holes that form from the cheap fabric they use.
Jan 24, 2013 7:12PM
avatar

Im not sure about this article. but I am sure is jc penny has good prices on most of there clothes.. in most cases cheaper than walmart..and its better quality too...What i dont understand is why more people dont shop there..when you can get a blouse for 8 bucks....you cant beat that at walmart...so maybe some ofthe prices are misleading....so what...

Jan 24, 2013 7:09PM
avatar

Department stores for the most part offer the consumer little real value when the BORG have taken over their business model.

Jan 24, 2013 7:07PM
Jan 24, 2013 7:05PM
avatar
Kohl's has my bussiness now ,can'tbelieve they are scewing up a store I used to like !! They have total crap now ,amd JCP on line is not any better !
Jan 24, 2013 7:05PM
avatar

every thing i buy from jc penney is fake, including the table that sits in my livingroom no doubght fake. i suspected that the price was fake as i wrote the check. yup it was fake alright,

Jan 24, 2013 7:04PM
avatar
The fake pricing is a huge problem there.  I used to shop there during the holidays a lot due to really good sales.  I think the sale prices got down enough to be reasonable, but I looked at the regular price of an outfit for my daughter and for a size 4t long sleeve tee and yoga type pants it would have been $50.  Excuse me!!!!
Jan 24, 2013 7:03PM
avatar
I used to shop at JCP for good quality basic women's cotton t-shirts, skirts, things like that.  They don't have those anymore; just cheap-looking items with too much spandex and a sleazy feel.  I've been really disappointed.  JCP was much hipper when it wasn't trying so hard to be hip.
Jan 24, 2013 7:01PM
avatar

So I guess there is a price to pay for treating your customers as if they were morons. People recognize a simple matrix of price and quality and JCP scored poorly.

 

Telling us we are getting a good deal is not the same as delivering one.

Jan 24, 2013 6:59PM
avatar

J.C.Who............OH, that place..........Used to walk through there on the way to go shopping.

 

But then again, I don't even go to the mall any more.

Jan 24, 2013 6:54PM
avatar
Thought that all retailers did that.  Highter MSR with their discount price???
Jan 24, 2013 6:46PM
avatar
I used to love going to Penny's and bought just about everything for our home there for close to four decades.  Now, I never even go into the store anymore.  The whole atmosphere changed a couple of years ago and it just didn't seem to meet my needs anymore.  I now happily shop at Macy's for the bulk of my home purchases.
Jan 24, 2013 6:44PM
avatar
J.C.Who?.............OH, that place..........Use to walk through there on the way to shop at the mall.
avatar

JCP needs new top management. They remind me of K-Mart. When K-Mart was on the ropes they decided to get into political causes. Well that ticked off half their customers and put them into bankruptcy.

Duh! JCP is doing the same thing by alienating tens of thousands of their customers by jumping into the political pit. Serves them right. Anytime a business decides that politics comes before business and customers they are heading down the bankruptcy path.

 

Report
Please help us to maintain a healthy and vibrant community by reporting any illegal or inappropriate behavior. If you believe a message violates theCode of Conductplease use this form to notify the moderators. They will investigate your report and take appropriate action. If necessary, they report all illegal activity to the proper authorities.
Categories
100 character limit
Are you sure you want to delete this comment?

DATA PROVIDERS

Copyright © 2014 Microsoft. All rights reserved.

Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.

Trending NOW

What’s this?

MARKET UPDATE

[BRIEFING.COM] The major averages punctuated a solid week with a subdued Friday session. The S&P 500 shed 0.2% to narrow its weekly gain to 1.7%, while the Nasdaq Composite (+0.1%) displayed relative strength. The tech-heavy index finished the week in line with the benchmark average.

Market participants went into today's session expecting to hear some new insight from Fed Chair Janet Yellen, who delivered the keynote address at this year's Jackson Hole Symposium. Unfortunately, the ... More

MSN MONEY'S