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J. C. Penney Company, Inc. Message Board

  • jcpenneyman85 jcpenneyman85 Aug 23, 2013 8:32 AM Flag

    JCPenney: Where It's Possible To Have A Sales Loss With Increased Traffic

    Across JCPenney land support leaders gathered their staff and discussed the whirlwind of activity about to unfold. August was about to begin and it was time to pry open those file cabinets of sign holders and fill the copy machine full of sign paper. The bugler had blown, it was time to get busy doing something that looked productive.

    I watched from a distance as a leader told her crew it was time to change gears. I didn't have the heart to tell her she was shifting to reverse. Walk into any JCPenney today and you'll see a sea of magnetic signs on virtually every rack. What a difference a year makes.

    Increased promotions has increased traffic that much is true. But what good is increased traffic flow if it doesn't add revenue?

    Her crew was busy putting up signs for the doorbusters. She delegated one person to run off copies of the $10 off $25 coupon to put at the each entrance. Team members also taped them to their registers and scanned one for every transaction. The intent of the coupon I suppose is one coupon per customer per shopping visit. That's not what happens. Customers are allowed to routinely separate piles of $25 purchases and use one coupon per stack. So in essence a customer making a $100 purchase is getting the benefit of the normal sale price, typically 50% off, plus a $10 off coupon off each $25 transaction. that's 4 $10 off coupons one customer.

    Now you know how we have increased traffic but yield, a 29% gross profit and negative growth.

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