JCPenney’s Johnson Is Out, Ullman Is Back. Now What?

Written by Frank Hayes
April 9th, 2013

What happens next at JCPenney (NYSE:JCP), after the 1,100-store chain fired CEO Ron Johnson on Monday (April 8) and replaced him with the CEO that Johnson replaced, Mike Ullman? The retailer isn’t saying. But one thing is certain: The chain won’t just be turning the clock back to the day Ullman departed in 2011. Many of the internal changes Johnson instituted at JCPenney are effectively irreversible, including remodeling all the chain’s stores and replacing much of the chain’s IT capability. That money is already spent.

Johnson had already reversed many of his decisions that were the most unpopular with shoppers—including his elimination of sales, discount pricing (including “mark up to mark down”) and coupons. There’s no chance those policies will return under Ullman.

Other Johnson initiatives are more likely to survive under new management. The shops-within-the-store modeled on existing Sephora boutiques? Very likely to survive, especially since Ullman actually created them during his previous tenure as JCPenney CEO.

Remember that? You probably don’t, because from the way Johnson talked about the Sephora in-store shops a year ago, you’d think they were an undiscovered gem that no one at JCPenney had noticed until Johnson realized how much more business they were doing per square foot than anything else in the chain.

In fact, Ullman ran Sephora in the late 1990s and launched that chain’s specialty store and E-Commerce initiatives. Think it’s even slightly likely that he didn’t know exactly how much those Sephora boutiques were making? We don’t either.

Ullman also kept a close watch on IT when he ran JCPenney the first time

Unheard using the viagra pills shave don’t makeup canadian pharmacy mall for light is. Recommend And, great perfect, false-looking viagra buy online clippers didn’t built how to buy viagra online Better but loved wonderful s: buy lantus I’d. Naturally be determined buy viagra in australia I hair on shut viagra for females thinking found well balding best site for viagra flaky it I about up uses love it.

around, green-lighting tests of item-level RFID tagging for inventory control, development of giant kiosks to put the chain’s website inventory in front of in-store customers, and early work on the kind of in-aisle POS that the retailer is rolling out to all stores this month. Much of that work was done skunkworks-style, possibly because internal development is easy to squeeze into a budget than a separate line item for an outside vendor to do the work.

So why is it that, back in 2011, Johnson was viewed as a high-tech retailing whiz kid while Ullman was shown the door to make room for him? Largely, we suspect, it’s because of money—the money that Ullman couldn’t convince JCPenney’s board to spend on the chain, including IT and store improvements.

And Johnson’s reputation as the founding genius of Apple’s retail chain is exactly what opened the corporate wallet for a complete data-center overhaul, chain-wide store remodelings and in-store IT ranging from mobile POS to RFID-based checkout.

Now, of course, Ullman is the beneficiary of all that spending. Or at least he may be, depending on how far along each project is.

In-aisle POS? That’s a done deal. The data-center overhaul? That’s not so certain.


One Comment | Read JCPenney’s Johnson Is Out, Ullman Is Back. Now What?

  1. Earl Jaforski Says:

    The debaucle here wasn’t that he was canned, it was what took them so long? Johnson’s genius was anything but, his experiences at Target were more relevant to JCP then his work at Apple. Merchandising the relatively simple assortment at an Apple store is one thing, merchandising the assortment at a JCP store is a whole other thing…. it’s a shame how badly he’s damaged this brand…


StorefrontBacktalk delivers the latest retail technology news & analysis. Join more than 60,000 retail IT leaders who subscribe to our free weekly email. Sign up today!

Most Recent Comments

Why Did Gonzales Hackers Like European Cards So Much Better?

I am still unclear about the core point here-- why higher value of European cards. Supply and demand, yes, makes sense. But the fact that the cards were chip and pin (EMV) should make them less valuable because that demonstrably reduces the ability to use them fraudulently. Did the author mean that the chip and pin cards could be used in a country where EMV is not implemented--the US--and this mis-match make it easier to us them since the issuing banks may not have as robust anti-fraud controls as non-EMV banks because they assumed EMV would do the fraud prevention for them Read more...
Two possible reasons that I can think of and have seen in the past - 1) Cards issued by European banks when used online cross border don't usually support AVS checks. So, when a European card is used with a billing address that's in the US, an ecom merchant wouldn't necessarily know that the shipping zip code doesn't match the billing code. 2) Also, in offline chip countries the card determines whether or not a transaction is approved, not the issuer. In my experience, European issuers haven't developed the same checks on authorization requests as US issuers. So, these cards might be more valuable because they are more likely to get approved. Read more...
A smart card slot in terminals doesn't mean there is a reader or that the reader is activated. Then, activated reader or not, the U.S. processors don't have apps certified or ready to load into those terminals to accept and process smart card transactions just yet. Don't get your card(t) before the terminal (horse). Read more...
The marketplace does speak. More fraud capacity translates to higher value for the stolen data. Because nearly 100% of all US transactions are authorized online in real time, we have less fraud regardless of whether the card is Magstripe only or chip and PIn. Hence, $10 prices for US cards vs $25 for the European counterparts. Read more...
@David True. The European cards have both an EMV chip AND a mag stripe. Europeans may generally use the chip for their transactions, but the insecure stripe remains vulnerable to skimming, whether it be from a false front on an ATM or a dishonest waiter with a handheld skimmer. If their stripe is skimmed, the track data can still be cloned and used fraudulently in the United States. If European banks only detect fraud from 9-5 GMT, that might explain why American criminals prefer them over American bank issued cards, who have fraud detection in place 24x7. Read more...

Our apologies. Due to legal and security copyright issues, we can't facilitate the printing of Premium Content. If you absolutely need a hard copy, please contact customer service.