J.C. Penney hopes for a home run with new launch

CEO Mike Ullman foresees growth in what has long been the retailer's worst-performing category.

By MSN Money Partner Jun 7, 2013 2:14PM

CNBCJCPenney celebrates the launch of its new Home department at Moynihan Station on June 6, 2013 in New York City (© Larry Busacca/Getty Images for JCPenney)By Courtney Reagan

 

J.C. Penney (JCP) hopes its new home products will boost flagging sales and help return the retailer to glory, the company's CEO told CNBC.

 

"We are very excited to be back where the home building business is picking up. Our dot-com business is likely to grow to over 50% home in the near future," Mike Ullman said Thursday.

 

Home goods have been the retailer's worst-performing category for seven years and have accounted for only 12% of its sales over the past fiscal year, compared with 21% in 2006.

 

But when asked whether its new home department could get the retailer back to where it was seven years ago, Ullman said it "gives us a chance to grow our business back to historical levels."

 

J.C. Penney's sales per square foot have fallen precipitously over the past year, but Ullman added that the higher price point of some of the designer home goods would help boost the key metric.

 

"Of course, (home) is a big space commitment. It's expected to earn its way," he said.

 

Big-name designers

It's been a year since J.C. Penney revealed that Jonathan Adler, Michael Graves and Terence Conran would join previously announced Martha Stewart as home design partners, and two months since the merchandise began showing up at stores and online.

 

In what J.C. Penney called its "biggest home launch ever," over 500 of its 1,100 department stores now have new home "shops," and an additional 145 are selling the merchandise.

 

Graves is optimistic about the success his brand has seen at J.C. Penney during the soft rollout.

 

"We are really happy with selling 1,600 kettles last week, that's a phenomenal number, and we never did that at Target," he said.

 

The kettle he's referring to has been at the center of recent controversy -- with some Twitter users saying an image of the tea pot on a billboard looked just like Adolf Hitler.

 

On Thursday, J.C. Penney kicked off its new home launch in a traditional way… with a sale. Select home department items have been reduced by up to 40% until June 16.

 

Some analysts expressed concern over the higher price points of some of the new designer home goods, but Ullman isn't concerned. He likened the home "attractions" (the term he uses instead of shops) to Sephora, the first shops he brought into J.C. Penney stores in 2006.

 

"Sephora today is the most successful thing in the store," he said. "It's the only thing that grew last year, and was profitable last year in the store."

 

"So I think many of these attractions will have the same effect. People are going to come for the core which they are used to at J.C. Penney, and they are going to start to notice these things -- they are going to find out it's not as expensive as it looks."

 

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Tags: JCP
21Comments
Jun 7, 2013 4:47PM
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Better get a grip on who your demo is before launching into high priced furniture. The average joe wants St. John's Bay and other men's lines like American living. Women WANT WORTHINGTON  BRAND BACK AND OTHER MIDDLE CLASS CLOTHES lines.Wake up beore it's too late.You can recover but give the people what they want, just like eating we like what we eat.
Jun 7, 2013 5:02PM
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I too used to like to shop at JCP but not anymore!  The selection of clothes is now targeted at the very young, tall and skinny person.  I would NEVER wear any of that stuff let alone even try to wear it to work!  Who wears a mid-ruff skirt to work?!  Common on - that's NOT professional work attire!   And what happened to the nice work clothes you used to carry???  JCP used to be the store to go to for work clothes but not anymore!  It's quite a shame!  And what's up with this Joe cool theme and the high end department store look??  You hardly have any merchandise, let alone a good size selection?!  REALITY - you are NOT a boutique you are a department store - that was your BIG mistake!!!  

JCP used to be the place to buy curtains and such - but that too has become a thing of the past!  I went in recently looking for a nice displays of curtains (since it used to be the place to check out the latest fashions on trends)  and that area was being re-modeled.  And you no longer have catalogs.  That ALWAYS had more options than the store could display and trying to match a color on-line just isn't the same as in person!  ANOTHER HUGH MISTAKE for JCP!!!  Bring back your nice curtain displays and not a Martha Stewart line like you were supposed to be getting!  YUK!!!!  You can get that at K-Mart - come on JCP!!!  GET IT TOGETHER!!!!! Or you will be out of business before the end of the yr!  You've lost WAY too many customers with your stupid changes just trying to make another buck and look where it's landed you - on the soon to be out of business list!

Jun 7, 2013 6:43PM
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Was I the only man in America purchasing the J.C. Penney STAFFORD Pocket T-Shirts? I think J.C. Penney needs to bring back the middle class clothing lines and wool suited separates.  I guess its much too much to reorganize the store so I can find what I am looking for.  At present, most J.C. Penney stores look like a tornado hit them.  A lot of people around to help, but no way to shop quietly and find what you want.
Jun 7, 2013 3:45PM
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JC Penny like Sears was once a great place to shop..... no more and it may be impossible to survive the competition. I have found new places to shop better than either of the old school institutions.
Jun 7, 2013 3:25PM
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I just took a look at their furniture pricing on line.  It's still WAY too high.  They'll never be able to compete against most furniture stores.  They'll probably do well with small kitchen appliances (hence, the good week for kettles) but if they want to crack open the furniture market, they'll have to get serious with the pricing.  I haven't been to penneys.com in years.  Now I won't go on again for years
Jun 7, 2013 4:29PM
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I used to enjoy shopping at jcps but the selection on clothes is horrible for people who are a bit obese...I'd rather pay a little more at shops like the Woman's Barn or something like that than  buy clothes that are cheap and unflattering on my body type.  Even Sears is hard to shop at anymore...
Jun 7, 2013 5:10PM
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I received their Catalog yesterday which was a great surprise for I have not shopped or been near a J.C.Penny store in over 5 years since my argument that the Sectional I received was NOT the same as the one in the store that I sat in. The one in the store had a high back which I need to support my neck due to arthritis. At the time I bought it it was on sale and so they said no returns. So I have avoided their store like the plague ever since.. So their Marketing Maggots must have reached "way back" into the time capsule to find people who used to shop there. I am not impressed with the catalog, Name brand Designers or famous designers to me just means "Over priced" Merchandise, plus their still pushing that ugly baby poop green, gosh I hate that color even more so than the Orange they pushed a couple of years ago.Ugllllllllllly!..Martha's stuff is still made over seas as well as most of the people they pushed in the catalog. Nothing, especially the prices made me want to drive the 25 miles to their closest store. I see the same quality Towels at Bed, Bath and Beyond and I believe cheaper too and I am not crazy about the color selection.  I am a heterosexual single male who wishes someone would manufacture Furniture, Linens, Bathroom and Kitchen stuff for me. And I do not mean with Sports decals all over it or Fishing etc. etc.  Just some nice decent male colors and not something designed by a Jail Bird or someone with Purple spiked hair and nose rings. So I am saying here is "Strike one". The catalog reminded me of a Target store presentation come to think of it and I rarely shop there anymore either.
Jun 7, 2013 5:02PM
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....as long as they get rid of Ellen and the gay dad's campaign......

 

I'll then return to JCP after refusing to shop there for the last 3 years.

Jun 8, 2013 10:39AM
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when I said the store should have ridding carts, a lot of you said "why don't you loose weight" or "buy your own" and some other nasty things.  First of all I weight 125 lb, I have had spinal surgery and still recouping with more surgery to come.  Thank all of you for your kindness and understanding.  May you have your health always and never need the help of others..
Jun 7, 2013 6:33PM
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Well I did not find sealy yesterday when online shopping.  Sealy is a medium priced bedding and bath product.  Don't let that one go JCP.  You must keep the catalog, enhance online shopping, I liked the Wednesday Deals.......always spent money on that day.  Bringing back the 60's summer charm schools for young girls.  Even the manners for boys and girls.  Don't get stuck on this high end.  Keep prices fair and offer some products for all income levels.  Keep the sales going, colorful ads, and incentive to give you our money.  I like the rewards, the special offers, etc.  Reward those that are loyal to you.
Jun 7, 2013 8:12PM
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Waiting for return of denim pants with elastic in waist. Have tried finding different clothing items and hit stonewall on my size and choice of color, always out. I liked Stafford and St .John's Bay and their price range.
Jun 7, 2013 4:08PM
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_JCP if you want people who will spent money in your store, put in rider carts.  I was in your store  just yesterday and had to leave because my leg hurt so bad  with no place to sit .  Sorry, you lost money that day.
Jun 9, 2013 7:02AM
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We just received the very slick JCP snail-mail catalog --- and Macy's prices at JCP will not get us back in the store.  For us, JCP just priced itself out of business.  Fancy names aside, it's just too darned expensive for what you get.
Jun 8, 2013 11:30AM
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I think there is a Greeter at WalMart, named Steve....OMG.
Jun 8, 2013 11:28AM
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Barbara...You more or less opened yourself up to this group and the remarks, gotta be careful..

Many of us have, severe or several problems, but don't expect JCP to cater to just us..Good Luck.

 

There are also signs on the windows and doors stating,

 

NO HOMOPHOBES or PUS-FACES ALLOWED...Go to WalMart or Target...

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