Can everyone be Target? Probably not, but many retailers continue to pursue the "bullseye" (Monday is now bad pun day) of low-priced fashion. Today's Women's Wear Daily(sub. required) profiled J.C. Penney's new commitment to service and more stylish products and the Wall Street Journal (sub. required) reported on Payless Shoes revamping of both stores and merchandise. Both companies also plan to test higher pricepoints, which pushes them out of competing with Sears and Wal-Mart but puts them squarely in the crosshairs of Target and even Macy's. Ultimate success is still TBD, but what both companies are doing right is linking store environment and service to product and marketing. This is where Wal-Mart failed famously, launching a fashion campaign in Vogue without upgrading the Wal-Mart experience to match. And, particularly in the case of Penney's, it is refreshing to hear a CEO not only talk about increasing customer service but also linking that to engaging their employees in the new brand mission by paying and treating them well. As reported in WWD:
Because Ullman believes a company is only as good as its employees, he sends them to Penney's retail university, where for one course students spend two days in a classroom with Ullman and the head of human resources. "We're invested in the associates and store managers," he said. "We see a 200 basis-point [increase in] profit when we engage the associates."
Associates today care about different things than they did a decade ago, including corporate responsibility, the environment and career opportunities. "They have expectations of us," Ullman said. "We need to engage them in a noble cause. They need to have the tools and the wherewithal to make decisions. If not, they're clerks." They also want to be paid fairly, so Ullman admonished the group to "be competitive with compensation. Pay the median and no less for talent."
Yet more hard evidence linking doing good with doing well. You can bet when our local Penney's store revamps, we'll be stopping by.