Do you "think" you know your customer?

I’m a GenX person from a small town in Northern Wisconsin. Growing up, we didn’t have many options for shopping, other than a few local retailers. Our closest mall was over an hour away. Anytime we needed clothes, toys, or just about anything for that matter, we pulled out one of two staple catalogs in our home – Sears and J.C. Penney. I remember being so excited when the J.C. Penney catalog would arrive in early Summer, because it meant that I could spend weeks pouring over the pages of the Children’s section to mark items that I wanted for my “back to school” wardrobe. Even before I was old enough to choose my own clothes, I’m fairly certain that my mom ordered at least one jumper like the one shown here in a catalog from 1975:

jc penney catalog image

Fast forward 30 years (boy am I dating myself!), and catalogs have become all but obsolete. I still live in a more rural setting, but the first thing I do when I need something, is search the internet. With such a drastic change in retailing since the rise of the internet, it’s no wonder that the 111 year old retail chain wanted to make changes in an effort to compete. I’ll admit, when I received the first “new” J.C. Penney catalog in the mail last Spring, I was intrigued. The new logo was modern and fresh; the clothing featured was much more trendy than the classic career wear and St. John’s Bay resort wear that have long been staples for J.C. Penney. And the ads featuring Ellen DeGeneres shopping without the burden of sale prices and coupons were somewhat clever. But, even though I was slightly more inclined to stop in a J.C. Penney store the next time I was near one, I couldn’t help but wonder how the typical J.C. Penney customer would react to the changes.

The team behind the “new” J.C. Penney was headed by Ron Johnson – one of the main people behind the success of cult-like brands Apple and Target. Unfortunately, the sweeping changes, from store layout to pricing strategy, weren’t so successful, and J.C. Penney posted an operating loss of more than $1 billion in 2012. It was announced last week, that after only 17 months at the helm, Ron Johnson and 3 others from his executive management team have been fired, and the former CEO, Myron Ullman, is not wasting any time in rolling back the changes in efforts to gain back customers lost to Macy’s and other competitors.

So, what happened? How could Ron Johnson have been so successful with Target and Apple, yet failed so completely with J.C. Penney? The answer is simple… Ron Johnson and his team didn’t understand the demographics and psychographics of the J.C. Penney customer base. They assumed that strategies that were so massively successful in their past, would be equally successful with J.C. Penney. They wanted to attract new customers to their stores, but didn’t consider that they might alienate their loyal customer base in the process. It seems that my early observation about the typical J.C. Penney customer was spot on. The end result was a 25% decline in sales, during the same time that direct competitor Macy’s was posting a 38% increase in profits (Q1 2012).

What lesson can we learn from Ron Johnson’s failure with J.C. Penney? First and foremost, that you can’t have a “one size fits all” strategy when it comes to customer experience. Emulating the customer experience of another company will not be successful, unless your corporate strategy is exactly the same. As noted in the book, Outside In, “you need to focus on defining the customer experience that best aligns with the corporate vision your executive team has put forth – your company’s target market, value proposition, unique strengths, financial objectives, and core values.”

The first step in a successful customer experience strategy is to define your customer persona(s) and the journey he or she will take within your company. The process is known as “Journey Mapping“, and entails identifying the points of interaction that a customer has through the 6 basic, but distinct phases of the customer’s relationship with your company. Only once you understand that journey, and the key “moments of truth” within it, are you prepared to define your customer experience strategy.

Want to learn more about Journey Mapping? Join us on Thursday, May 9th at 9:00AM (CDT) for a free webinar: “Using Journey Maps to Optimize the Customer Experience“. My wonderful colleague, Valerie Vogt (@valeriaav) will illustrate the value of this process through a real-world case study of Red Wing Shoes.

Or, are you ready to get started? The Avtex Strategic Consulting Team is currently offering a special promotion on Journey Mapping. Our seasoned team of customer experience experts can help you define your customer persona and journey, and jump start your customer experience strategy.

Now that we have watched such a brilliant visionary in customer experience fail, it can seem even more daunting to define and execute a customer experience strategy within your company. If there is a lesson to be learned from J.C. Penney, it is this – make sure you know your target market! Do you “think” you know your customer? Have you thought about all the points of interaction they may have with you?

Categories: Customer Experience.