Monday, July 30, 2007

JC Penney -- Leading the Way in Multi-Channel Marketing

JCPenney is leading the way towards a successful retail-oriented multi-channel marketing approach. Through the utilization of micro-websites targeted to their specific customer segments, they are driving more traffic online. In addition, by advertising these websites in their retail stores and catalogs, they are increasing sales in all channels. This is smart direct marketing at it's best -- using the traditional, more-costly channels to drive traffic to the less-traditional, less-costly channels while increasing sales in all channels. Brilliant!

In the recent DM News article, is Linchpin in JCPenney's Multi-Channel Marketing Strategy, Senior Editor Chantal Tode reports that in "hoping to encourage in-store shoppers to purchase more at, JCPenney devised a program to take advantage of the complementary nature of the retail and direct assortments in its newborn/infant/toddler business, where 90 percent of in-store sales come from apparel and 87 percent of online sales are generated by furniture and strollers. The pilot was launched during the third quarter of 2006 in 40 stores with several in-store displays featuring signage communicating the expanded department available online. Shoppers could also pick up a catalog highlighting baby furniture or learn about JCPenney’s Baby Solution microsite, where pregnancy advice and tips for decorating a nursery are available. Results from this multichannel strategy were encouraging enough that JCPenney is planning to roll it out nationwide."

This strategy has proved so successful for the infant/baby/toddler market segment that JCPenney is continuing to use this synchronized approach across channels to launch many of their new brands across market segments. And as their retail strategy (in terms of store size and location) continues to evolve, the article reports that this internet-focused, multi-channel approach also helps them to better determine new store type and location.

We often discuss the importance of using multi-channel marketing as part of your direct marketing strategy. In fact, we're so passionate about this subject that we've created a white paper on best practices for Multi-Channel Integrated Marketing. JCPenney is proving how a traditional retailer can embrace the use of all channels to not only better target their customer segments, but also to decrease costs by efficiently driving traffic to the less-costly channels. It'll be interesting to track the success of as they continue to expand and to see the overall impact to JCPenney's bottom-line. We think profitability is bound to rise!