11/09/12

Web sales drop 37% for Penney in Q3

The Internet accounts for 7.3% of all sales, down from 8.5% in the prior year.

Mark Brohan , Research Director

It was another tough three months for J.C. Penney Co. Inc. online and everywhere else in the third quarter.

For the quarter ended Oct. 27, J.C. Penney, No. 20 in the 2012 Internet Retailer Top 500, reported:

The web accounted for 7.3% of total sales compared with 8.5% in the prior year.

“Today, Penney is really a tale of two companies and by far the largest part of our store is the old Penney, which continues to struggle and experience significant challenges as evidenced by our third quarter results,” says CEO Ron Johnson. “However, the new Penney centered on the shop concept, is gaining traction with customers every day and is surpassing our own expectations in terms of sales productivity.”

In January Penney began implementing a new strategy–The Shops–designed long-term to transfer J.C. Penney into a specialty department store online and in its stores. The strategy includes permanent discounts and specific marketing and merchandising programs on apparel such as jeans and brands like Liz Claiborne. “While the quarter overall was challenging, the performance of new brands and shops reinforces our conviction to transform Penney,” Johnson says.

But any long-term transformation has yet to help Penney improve its immediate financial performance.

For the first nine months:

The web accounted for 7.7% of total sales compared with 8.8% in the prior year.

Topics:

JC Penney, JC Penney Q3 earnings, Liz Claiborne, Q3 2012 earnings, Ron Johnson, specialty department store, The Shops, Top 500

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