The struggling department store chain this week is rolling out some of the hundreds of sales it ditched last year in hopes of luring back shoppers who were turned off when the discounts disappeared.
Penney also plans to add new price tags or signs for more than half of its merchandise to show customers how much they're saving by shopping at the mid-priced chain -- a strategy that a few other retailers such as home decor chain Crate and Barrel and the company that owns TJ Maxx, HomeGoods and Marshalls. For store branded items such as Arizona, Penney will show on store signs a comparison of prices from competitors.
The moves are a departure for Penney on the eve of the one-year anniversary when it vowed to almost completely get rid of the sales that Americans covet but that cut into a store's profits. The idea was to offer everyday low prices that customers could consistently count on rather than the nearly 600 fleeting discounts, coupons and sales it once offered.
The bold plan has been closely watched by others in the retail industry, which is notorious for offering deep discounts to draw shoppers. But so far the experiment has served as a cautionary tale of how difficult it is to change shopper' habits: Penney next month is expected to report its fourth consecutive quarter of big sales drops and profit losses.
CEO Ron Johnson, who rolled out the pricing plan shortly after taking the top job in November 2011, told The Associated Press last week that the latest moves are not a "deviation" from his strategy but rather an "evolution." He also vowed he would not be bringing back coupons.
"Our sales have gone backward a little more than we expected, but that doesn't change the vision or the strategy," said Johnson, who previously masterminded Apple Inc.'s retail stores and Target Corp.'s cheap chic fashion strategy. "We made changes and we learned an incredible amount. That is what's informing our tactics as we go forward."
But critics say that Johnson is backpedaling. Walter Loeb, a New York-based retail consultant, said Johnson "is now realizing that he has to be more promotional to attract shoppers."