Interesting piece in the Washington Post about how JC Penney, like many retailers, “has failed its most loyal shopper: the middle-aged, middle-income mom of middle America. Analysts say retailers, caught up in a millennial-chasing frenzy, have invested heavily in new store formats and trendy brand partnerships,” which has both made middle-aged, middle-income moms “feel unwelcome” while “eating into companies’ bottom lines.”
Part of the problem, analysts tell the Post, “is economic. Rising inequality and stagnant wages have squeezed middle-class Americans, leaving them with less disposable income to spend on clothing and housewares. As a result, they are trading down from department stores to chains such as Target, Walmart and T.J. Maxx, where business is booming.”
But companies like Penney and Kohl’s and Dress Barn find themselves sinking in the mushy middle, with expectations that tariffs on imported goods only will make things tougher in the short term.
Part of the problem, analysts tell the Post, “is economic. Rising inequality and stagnant wages have squeezed middle-class Americans, leaving them with less disposable income to spend on clothing and housewares. As a result, they are trading down from department stores to chains such as Target, Walmart and T.J. Maxx, where business is booming.”
But companies like Penney and Kohl’s and Dress Barn find themselves sinking in the mushy middle, with expectations that tariffs on imported goods only will make things tougher in the short term.
- KC's View:
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One place where I think I’d disagree with some of the analysts quoted in the Post story is the conclusion that the short tenure of Ron Johnson - the former Apple Store exec who wanted to reduce the chain’s reliance on coupons and promotions and create a store-within-a-store approach - may have been the beginning of the end for JC Penney.
I’ve long believed that while the implementation was flawed - to say the least - Johnson was right that JC Penney was so invested in a promotional strategy that it no longer had a compelling story to tell to shoppers.
The middle, I think, doesn’t have to be mushy. I think it can provide a solid foundation for a retailer, but it has to be built upon with imagination and innovation … offering a compelling narrative.
