Rebranding in the Retail Industry

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Abstract

The current economic environment, shifting consumer preferences, and technology advances have aggressively increased competition in the Retail Industry. Companies have been forced to reevaluate strategies, appearance, and overall brand to stay competitive. This paper aims to evaluate reasons companies choose to rebrand, the process of rebranding, and the impact it has on the company. The author presents JC Penney and its failed attempts in rebranding. The paper examines the rebranding decisions JC Penney made and the impact these decisions had on the company. The author provides alternatives and recommendations, as well as implementing methods, risks, and challenges for JC Penny to consider in overcoming its current dilemma in brand identity.

Introduction

In today’s retail environment, companies are faced with tough competition. Forced to make changes, the companies are renovating past designs, marketing plans, and store environments to remain competitive. Rebranding is making it possible for companies to start fresh with modernizing the company’s trademark. Although rebranding helps companies achieve a renovated image of the company, it also can damage a company if the proper steps aren’t taken. One company that has recognized the need to rebrand was JC Penney. The company chose to rebrand and has done so several times. Over the past one hundred years, JC Penney has made several changes to the company’s image and in recent years, the company began to make major changes to revamp the company’s image. Opening its doors with a new appearance, JC Penney hired a new CEO, Ron Johnson, who successful innovated companies like Apple and Target, to execute this new campaign. Renovating the company inside and out, Ron Johnson made major changes at the company, specifically to the name, logo, marketing visuals, store environment, pricing structure, product mix, and promotions. Although, all of these changes were made in attempt to successfully rebrand the company, the campaigns didn’t receive the approval it was hoping for. Ron Johnson remained confident in the decisions that were made, but others were not. Business analysts criticized the decisions the company made with the new campaign, stating that the company’s new campaign was confusing and customers seemed to agree when 1st quarter sales reported a 19% drop. Listening to its customers, JC Penney revised some of the decisions and presented a 3rd campaign with changes to pricing and promotions. Still analysts criticized the company and believe the changes weren’t enough for the company to survive. Second quarter reports showed no improvement as the company revealed its largest undertaking; the renovated store environment. The rebranding of JC Penney has been a rollercoaster ride of uncertainty. As the company is looking more optimistic, some changes the company has made are still negatively affecting the company. The paper explains rebranding, analyzes the Retail Industry, and evaluates JC Penney. This provides support of the recommendations proposed for the company to overcome these failed rebranding attempts. Overview of Rebranding

Successful companies have many things in common; one in particular is brand identification. When customers can recognize a brand without the company’s name on the product, it shows that the company successfully trademarked itself to the customer. Branding is significant to a company’s success. For instance, Nike has branded itself by using an image of a swoosh mark and the slogan, “just do it.” Customers now can identify immediately if a product is Nike by seeing these trademarks on the products or in commercials. Successful branding of a company is challenging and can take a long time for a brand to develop. Rebranding is when a company is seeking to provide a clear message to its customers and in response renovates its brand by creating a new look and feel for the company in order...
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