JCPenney 2007 Annual Report Download - page 5

We recently unveiled a series of programs to empower our Associates
and ensure their energies are directed to making a stronger emotional
connection with our customers and consistently delivering a shopping
experience our competitors cannot easily match…one that is
easy, exciting and engaging.
n By easy, we mean offering navigable aisles, good lighting,
effortless checkout and an inviting environment.
n We want the shopping experience to be exciting because our
merchandise is inspiring and fills a need in our customers’ lives.
n Finally, we will ensure that their visit to JCPenney is engaging.
Our Associates will make our customers their number one
priority above any other task that needs to be done in the store.
Leadership in Our Sights While we have made prudent modifications
to our plans and timing based on economic conditions, our goal
remains the same: to be the retail industry growth leader, and we
continue to believe our Long-Range Plan represents the best strategy
to achieve that goal. This means creating a deep and enduring
connection with our customers by inspiring them with our merchandise
and services as well as the shopping experience we offer. It also rests
on continuing to engage and motivate our Associates, so that we
retain and attract the best people in the retail industry. And it relies on
the continued support and trust of our stockholders as we work to
best navigate within the current environment and emerge a stronger,
more competitive and more profitable Company.
As we pursue our plans, I would like to thank our 155,000 Associates
around the country for their hard work and laser focus on best serving
our customers, and our Board of Directors for their wise counsel and
dedication to JCPenney’s success. In particular, I would like to thank
Ann Marie Tallman, who resigned from our Board in late 2007, for her
service as a director. And I would like to welcome Javier Teruel,
the former Vice Chairman of Colgate-Palmolive and a highly
respected global consumer goods industry executive, as well as Ken
Hicks, President and Chief Merchandising Officer for JCPenney, to
the JCPenney Board.
On behalf of your Board and management, I assure you that we have
deep faith in the strategies we are pursuing, the capabilities of our
Associates and our ability to deliver strong results over the long term.
We look forward to sharing our progress with you.
Myron E. (Mike) Ullman, III
Chairman of the Board and Chief Executive Officer
April 2008
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will put us in a strong competitive position today and when the
environment improves.
We will Moderate our capital spending plan by opening a total of 36
new stores in 2008, compared to our original plan for 50 new stores,
and reducing the number of store renovations we undertake. We are
no less committed to our goal of expanding our business and ensuring
we have stores to meet customer demand in some of the newer and
growing communities across the country, but we are reducing the
pace of these openings to be in-line with the consumer spending
patterns we anticipate will remain for the rest of 2008.
At the same time, we plan to Maintain those initiatives that offer
the best opportunities for growth and profitability. They include:
n The largest brand launch in our history, American Living, an
updated classic, traditional lifestyle brand created exclusively for
JCPenney by Polo Ralph Lauren’s Global Brand Concepts. With
merchandise in 40 categories for women, men, children and
home, American Living is now available in 600 JCPenney stores,
on jcp.com and through our catalogs.
n The continued rollout of our highly successful Sephora inside
JCPenney concept. Today, there are 72 Sephora shops within
JCPenney and they are generating strong sales performance as
well as encouraging “cross shopping” in other departments.
n Further improving our Eight Power Brands: Ambrielle, a.n.a,
Arizona, Chris Madden, Cooks, St. John’s Bay, Stafford and
Worthington. We are committed to continually enhancing these
private brands, making them even more powerful and inspiring to
our customers.
n We are also dedicated to ongoing improvement in our strategic
merchandise flow initiatives, by making even greater progress in
our cycle time reduction processes and more efficient flow of
seasonal merchandise, further refining our ability to ensure that
we have what our customers want every time they shop with us.
Finally, we will Accelerate our plans in those areas where we see the
most substantial near-term potential. For instance, until recently we
had separate buying and marketing teams for our Stores and Direct
(jcp.com and Catalog) divisions. We recently realigned these teams,
so Stores and Direct are served by the same groups, allowing us to
merchandise to our customers with “one voice” and offer a seamless
shopping experience. Other initiatives we will Accelerate include
improving our messaging to customers, as well as more aggressively
enhancing our overall brand awareness to make sure our customers
know that we realize that “Every Day Matters.” Additionally, we will
continue investing in critical areas of our information technology
systems that support key initiatives.
Putting Our CustomerFIRST Across JCPenney, we believe
companies that gain market share in a difficult environment are those
that keep a vigilant focus on best serving the customer. That is why
the primary initiative our Associates will pursue in the current year is
putting the CustomerFIRST.