Former JCPenney CEO Allen Questrom went on CNBC's Fast Money Halftime Report today to talk about the retail world, and he had some strong words to say about what Ron Johnson is doing at JCPenney.
Questrom is a retail legend, with an illustrious career that included jobs at the helms of JCPenney, Nieman Marcus and Barneys.
He criticized Johnson's decision to kill discounts at the retailer:
"His first part of the strategy, which is the elimination of the discounts and the coupons, has clearly been a failure. I've never seen a strategy of some company this size drop that much in the two quarters that he's had. And I guess it's a pretty good indication that it may be something he believes in, but I believe the customer does not believe in it."
He also explained that the effects of promotions and sales are different for a retailer like Walmart, since people are going there for things that they really need.
What Questrom is particularly surprised about is the way Johnson is going about the redesign of JCPenney's stores. Again, he voices his concern about what the customers really want:
"Now as far as the second part of the strategy, which is the redo of the stores, I can't tell. But one thing I will say is I'm shocked that they're going forward with this without even testing one or two stores to see how the customers like it. I've always believed that I try to do things based on customers telling me they like something ... We've all renovated stores over the years, and we always learn a lot from each time we do one, but to do all of them at one time without testing the first one, you have to question what kind of a strategy that is."
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