Joe Fresh at JCP

Last month JCPenney launched Joe Fresh pads in almost 700 stores. The 1,000 square foot area is typically at the main entrance and features a gray wood floor, white accent walls, orange signing and an open feeling because there are fewer fixtures than in comparable areas of the store (and fewer items, averaging 800 excluding flip-flops). Joe Fresh is a Canadian brand trying to appeal to a younger, stylish, casual, price-conscious female shopper.

The strategy for JCP is reasonably clear: enhance the image of the store by showcasing an aspirational brand. Unlike Sephora and some of the upcoming Home Store brands, however, the name “Joe Fresh” means nothing to most consumers. And while it looks fresh inside the otherwise fashion-bankrupt JCP, it has no relevance to the JCP customer because of the pricepoints, sloppy storekeeping and styling gambles.

Pricepoints. The goods are priced 20% to 50% higher than comparable merchandise available at H&M, Forever 21 and Gap. This might work for Canadian stores and in Manhattan because it’s not so easy to comparison shop, but in U.S. malls it’s too easy for the customer to walk a few feet to a true competitor.

Storekeeping. JCP’s payroll slashing has come with a cost, and it shows in the seemingly minor customer-frustrating issues seen throughout the store. These are especially egregious in a flagship “welcome to our store” brand such as Joe Fresh. Typical in JCP are misplaced toppers: for example, “$10 Print Tee” sign over a T-stand of blouses, and “$39 Stripe Dress” sign over a rack of colored chino pants. In three stores in three markets, approximately half the signing was incorrect.

Styling. Joe Fresh’s business model depends on limited styles, to hold down production costs and markdowns. This heightens the need to be right. And even if it’s “right,” it might not be “enough.” As an example, at JCP Joe Fresh’s featured blouse is a simple silk item for $39. Simple blouses are available (not in silk, admittedly) for a third to a half of that price, in a range of styles with varying dart features, collar treatments, back interest, button placement and so forth, in all of the specialty retailers listed above and no doubt many more. So the question becomes why would a customer buy this item at this store for this price?