It’s kind of a no-brainer: when one company loses, its rivals stand to gain. And so it is for JCPenney, amid the turndown in traditional retail sales that’s causing Macy’s and Sears to close stores around the country.
JCPenney CEO Marvin Ellison talked to CNBC about how the issues plaguing the company’s competitors is good news for JCP. Responding to a question from CNBC’s reporter about what happens to JCPenney’s traffic when a Macy’s or a Sears in that same mall closes, Ellison said it’s a win.
“Our historical trends tell us that it is a net positive to JCPenney,” he said. “When we share a mall with Sears and they close, we gain market share. So it’s a net positive for sales growth. When Macy’s closes in a mall, historically, it’s been a net positive,” he said.
What’s more, these store closures are “well telegraphed,” meaning JCPenney knows when and where to swoop in and try to lure customers who used to shop at the closed stores.
“We know exactly when it’s going to happen, so we can take specific steps to get the traffic to flow our way,” Ellison explained. Even if mall operators don’t replace a closed store — which is typically one that’s been underperforming, meaning there’s not really any traffic to steal — with a JCPenney location, he adds that “net positive, we think that it’s going to benefit us and allow us to take market share” regardless.
JC Penney CEO Marvin Ellison Sits Down with CNBC’s Courtney Reagan on “Power Lunch” Today [CNBC]
by Mary Beth Quirk via Consumerist
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