J.C. Penney rebranding designed to affect bottom line for customers, corporation

HOBART | The nationwide rebranding of J.C. Penney & Co. that launched Wednesday brings the 110-year-old department store chain back to its roots yet connects with customers' lifestyles, the retailer's divisional vice president said.

"This is the first day of a three–plus-year transformation. After 110 years, our Fair and Square pricing brings us full circle," Jeff Hicks told employees at the Westfield Southlake mall store before its 10 a.m. opening.

New top leadership started J.C. Penney on this path to "reclaim its birthright and become America's favorite store," Hicks said.

New CEO Ron Johnson joined the retailer in November after serving as Apple Inc.'s senior vice president of retail. He worked for Target Corp. before Apple.

Michael Francis, J.C. Penney's new president, also was with Target, having served as chief marketing officer.

Fair and Square pricing eliminates the need for coupons, multiple promotions and percent-off sales, and simplifies the way to present merchandise, Hicks said.

Red tags are everyday prices that "are the same as sales prices in the past," he said.

White tags are monthlong values, and blue is "the best price reduced to the lowest price it's ever been," Hicks said.

"On the first and third Fridays of every month, the blue pricing will be marked on specific merchandise," he said.

This marketing strategy coincides with about 75 percent of Americans' paydays.

For the company, the multiyear rollout of changes is projected to provide "some pretty healthy profit growth," Hicks said, although exact projections aren't yet available.

Cost-cutting measures are also part of the plan to "get in line with our competition," he said.

Although reductions are taking place throughout the corporation, Hicks said the Hobart store "has not taken any full-time employees to part time."

The company is targeting $900 million in expense cuts to be completed over the first two years of transformation, J.C. Penney Chief Operating Officer Mike Kramer said.

"We will still have our weekly (newspaper) insert and more TV ads," Hicks said.