Ron Johnson should return to Apple

He helped design the tech giant's iconic and highly profitable stores and is fresh on the market after a failed stint at JC Penney.

By TheStreet Staff Apr 9, 2013 1:53PM

thestreet logoCEO copyright Photodisc, Getty ImagesBy Chris Ciaccia


Former J.C. Penney (JCP) CEO Ron Johnson is looking for work after being ousted at the retailer for poor performance, horrendous sales figures, a slumping stock price, and concerns about lost consumers. What better place to return to glory than the place that made him famous: Apple (AAPL).


Johnson was relieved of his duties Monday evening after J.C. Penney shares had slumped by 50% since he took over. Johnson's plan was to turn the Plano, Tex., retailer into a mall-within-a-mall concept, taking unused square footage and setting up specialty shops, breaking the traditional department store model.


This was a grand and ambitious plan from the start. But Johnson confused, and in some cases alienated, core customers by taking away coupons and muddling the company's message. The company's most recent earnings report demonstrates that, with revenue down 30% year over year. The year-to-date share price says even more, with the stock off 19.5%, compared with nearly a 10% gain in the S&P 500 ($INX).


Despite concerns about his plan and a seemingly never-ending falling share price, Johnson is still an intelligent retailer, having helped design the Apple Stores you see today and to shape Target (TGT) before that. Apple CEO Tim Cook is looking for a new head of Apple Retail, now that John Browett has been relieved of his duties (TheStreet). Cook admitted that Browett was a mistake, and since October he has been actively looking for a candidate to lead Apple's retail stores.


Johnson worked with then-CEO Steve Jobs to create Apple's stores, which Cook has said are the key to Apple's success. Jobs is no longer there, and the shine is off Johnson, so this would be a different situation than building from the ground up. An appointment of Johnson by Cook could even become a lightning rod for Apple, which has received its fair share of criticism in recent months. From concerns over product innovation to a slumping stock price -- sound familiar, J.C. Penney investors? -- Apple has been left in the dust in the minds of certain investors.


There has even been some criticism from Apple retail employees that Johnson's coming back to Apple wouldn't be the right answer. There are concerns that Johnson is too old and not the young, hip answer Apple needs. But that thinking misses the forest for the trees. In every crisis, there is an opportunity. Johnson's crisis at J.C. Penney could be his opportunity to re-emerge at Apple, allowing the tech titan to continue in its battle with SamsungGoogle (GOOG) and others. 

Johnson, despite his age, is still full of fresh ideas. The idea of turning J.C. Penney into a mall was something that had never been tried and has been lauded publicly. Former J.C. Penney CEO Allen Questrom was quoted recently as saying the new shops "are very creative, very well done," but concerns over whether consumers wanted the shops were another story.


New ideas don't happen often in retail, and Johnson is someone with a track record for innovation in a stodgy industry. Critics shouldn't be so quick to dismiss a Johnson return to Apple just yet. At Apple, he would be out of the spotlight, and have ample ammunition (namely Apple's incredibly strong balance sheet) to put his vision to work.


Apple Stores are still the most profitable retail operations per square footage in the world, surpassing even Tiffany (TIF). Johnson is responsible for a large part of that. Apple was built on innovation, and if Johnson still has any left in him Apple would be wise to at least look his way.

Window shopping never hurt anyone's wallet.


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Apr 9, 2013 3:31PM
Johnson should just go away and never come back..
Apr 9, 2013 2:46PM
he has a poison name for the time being at least.  he nearly took down an old long standing USA company.  i'd bet no one wants him for many months.  he'll have to spend his few million at home for the time being
Apr 9, 2013 3:45PM
a bad choice for apple if he was so good why would they let him go in the first place??? HE LOST TOUCH WITH THE PUBLIC   apple needs to align itself with the shareholders and custumers which mr cook has forgoten       WE ARE THE COMPANY !!!  learn to share the wealth
Apr 9, 2013 5:57PM
Retirement should be the only place he should be headed.  He shouldn't be given a chance to ruin another company
Apr 9, 2013 3:40PM
Apr 10, 2013 9:36AM
It's a great News! Hoorray, Hey Board members of JC Penny, Don't forget to forfeit his every penny. You can excuse him from his jail, but don't forget to snatch every penny he has stolen from jcpenny. someway he should be punished , and punished hard. Whenever a company is in bad shape first blow normally comes to the low-earner, though this is wrong, first the blow should go to the management, because it is their fault and mis management. Unfortunately it never happens this way, as because of dirty power game, management always hide their sharp teeth and nail behind middle class and poor.
Apr 10, 2013 9:53AM

Apple should take him, so he can spoil a bunch more.

Apr 9, 2013 3:37PM
mr johnson may just turn out to be a one trick pony. tech and us oligopolies (cable tv, landlines and the like) are really the only places where you can stuff products down someone's throat. people do not have to shop at penny's. they can go to kohls or sears or tjx. if he has great talent it will show itself again. time will tell
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