Dive Brief:
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After a second sexual misconduct charge emerged against Def Jam Recordings co-founder Russell Simmons, J.C. Penney has discontinued sales of his apparel label, Argyleculture, which Simmons founded in 2012, a representative from J.C. Penney confirmed to Retail Dive. "In light of the recent allegations against Russell Simmons, J.C. Penney has decided to discontinue selling Argyleculture merchandise," a spokesperson said in a statement emailed to Retail Dive.
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Simmon's collaboration with J.C. Penney was announced last year. "I have finally found the right retail partner for my brand," Simmons said in a blog post at the time. "J.C. Penney is perfect for Argyleculture. I can now make quality clothes at a great price."
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The clothing line reflected an updated classic vibe that suits more conservative customers as well as younger ones and was available in 80 J.C. Penney stores and online.
Dive Insight:
News of allegations against Simmons would have been problematic for J.C. Penney at any time. But, with the current no tolerance temperature in the aftermath of the Harvey Weinstein sexual harassment allegations, as powerful men across industries (including Roy Price, the head of Amazon’s movie and TV unit) have been fired for similar allegations, the retailer had no choice but to immediately yank Simmons' label from its racks.
When it comes to the nuts and bolts of J.C. Penney’s merchandising, though, the moment comes at a bad time. The retailer’s struggles stem mostly from its problems in women’s apparel — the company in October attempted a drastic reset and swept away much of its women’s inventory as it warned of a critical sales slump in the third quarter. Last month, the retailer announced the departure of longtime merchandise chief John Tighe.
Recently, the company did manage to beat estimates from analysts and itself: Q3 revenue grew to $2.90 billion from $2.76 billion, and same-store sales grew 6.4%, topping FactSet analyst estimates of a 5.7% increase. CEO Marvin Ellison said Q3 gross margins and earnings "exceeded our expectations.”
While its men’s sales may not play the critical role its women’s apparel sales do, the retailer’s partnership with Simmons by many accounts had been a welcome addition to its lineup. Both Simmons, J.C. Penney executives and vendors last year said that sales were brisk, according to a report last year from MR magazine.
