J.C. Penney vows change after customer service scores plummet

Dive Brief:

J.C. Penney’s turnaround has taken hold, but its customer service leaves much to be desired, the Dallas Morning News reports.
Penney's “Net Promoter Score,” a standard followed by most in the industry, fell 10 points last year, behind Macy’s, Kohl’s and Old Navy, and barely above Wal-Mart’s perennially low scores.
Joe McFarland, J.C. Penney's EVP of stores, told store managers gathered at an annual staff meeting that regional managers and other top brass plan to pare down the paperwork moving forward, pointing to a huge stack of printed emails that executives sent out over the course of just a month.

Dive Insight:

While discounting has long been a sign that the customer is in the driver’s seat in retail, many brands have nevertheless fallen down on customer service. J.C. Penney is making it clear that trend will end, telling managers that it aims to free them up to better train employees to take care of customers, encourage entrepreneurial spirit among store staffs, and emphasize "local differences" to better meet customers’ needs.

J.C. Penney plans to streamline its dealings with its store managers, sending out weekly playbooks rather than forcing managers to fill out reams of paperwork. The company also will be improving in-store Wi-Fi and checkout processes, developments that were met with applause, according to the Dallas Morning News.

It’s not clear from the report what executives mean by “local differences,” but experts have told Retail Dive that successful hyper-localization entails attending to what customers desire at the store or local level.

“There are things that you carry in your store that make it who your store is, and [customers] expect them when you walk into that chain,” Michael Stefanakos, VP at “lean retail” analytics firm FieldStack, told Retail Dive. “Then you have things that are regional, and hopefully you’re looking at analytics” to figure out what those will be."

J.C. Penney last month reported Q4 revenue that beat expectations. Q4 sales increased 2.5% to $4 billion, driven by strong sales of home goods, footwear, handbags and its Sephora concessions. Same-store sales in the holiday months of November and December rose 3.9%, thanks in part to strong e-commerce and success in sales of Penney's private brands.

“Our focus on private brands, omnichannel and revenue per customer is clearly resonating as we continue to win market share in a competitive environment," J.C. Penney CEO Marvin Ellison said in a statement accompanying the Q4 earnings report. "I would like to thank our over 100,000 associates who embrace our strategy and come to work each day focused on driving sales and providing excellent customer service."