When Innovation Fails

The JC Penney Innovation Story

www.businatomy.com

How do you fail…

at innovating

…an iconic retailer?

Try to turn it into Apple.

Enter Ron Johnson.Former Apple Executive

Hired to

Hired to

INNOVATE

Hired to

INNOVATEand turn around

Hired to

JC Penney

INNOVATEand turn around

Ron’s Strategy?

Eliminate weekly sales

Create beautiful displays

The problem was…

Best practice innovation doesn’t always work.

Let’s eliminate sales.

Let’s eliminate sales.

Discounts aren’t cool

Let’s eliminate sales.

Sales are not hipDiscounts aren’t

cool

Let’s eliminate sales.

Sales are not hipDiscounts aren’t

coolCoupons are old school

Let’s eliminate sales.Apple would

never…

Sales are not hipDiscounts aren’t

coolCoupons are old school

Doesn’t this sound innovative….

…for an iconic retailer like JCP?

It worked for Apple. Right?

But JCP built business around…

WEEKLY SALES!

WEEKLY SALES!

And coupons.

WEEKLY SALES!

And discounts.

And coupons.

“We worked really hard and tried many things to help the customer understand that she

could shop any time on her terms.”

“But we learned she prefers a sale.”

“At times, she loves a coupon.”

“At times, she loves a coupon.”

Ron Johnson – Former JCP CEO

In 2012, JCP had one of the worst losses ever.

“It’s the worst performance I have ever seen by a company in one year.”

Walter Loeb – Independent Consultant

Apple’s best practices are fantastic.

Apple’s best practices are fantastic.

And beautiful.

But not for everyone.

Best practice innovation must be carefully thought out.

If you have built your business around a concept

or service…

…your customers might be used to it.

And might even like it.

And might even like it.

“At times.”

When Innovation Fails

The JC Penney Innovation Story

http://www.businatomy.com/blog/2013/5/28/3-types-of-innovation

www.businatomy.com