Question

Please read the case "Is JCPenney Killing Itself with a Failed Strategy?"1 in your textbook and answer the following questions. Type your answers on a Word Document (make sure to include your Name Surname and Student ID Number on it) and submit to the Homework inbox on Moodle. Questions: Each question is worth 25 points. 1. What (business level) strategy was the new CEO at JCPenney trying to implement given the generic (business level) strategies found in Chapter 4. 2. What are the major competencies of JCPenney in the given case? Why do you think they are struggling to use these competencies to solve the problem they face? 3. What kind of innovative approaches can be used to solve the problem in this case? What kind of risks do you think they should take? 4. Suggest the most appropriate business level strategy for JCPenney. Discuss why.

Answer 1

1. The new CeO adopted store - in- store model with value pricing mechanism and offering additional discounts to existing and new customers base.
2. The major competencies here for JCPenney is global brand image, customer awareness, strong recall value, high distribution and marketing. However due to brand cannibalization and poor strategic marketing is causing the customer base to fall.
3. Here innovation based strategy like referral marketing and affiliated marketing can help steal customers from competitors, offer higher value and retain them using repeat purchases discounts to maximise sales per square foot. However key risks like economic risks are taken for example if economy enters recession, the strategy fails massively.
4. Most appropriate business level strategies are diversification into new brands and businesses, divestment of non performance locations and consolidation with competitive market can help maximise profits. this helps lower costs and brings higher synergies and eliminates competition as well to boost revenues.

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