CEO Ron Johnson Boosts TV Advertising, Adds Former Coca-Cola Marketer Sergio Zyman as an Adviser
sales plummeted 25% in 2012, even as its measured media spending jumped 14% to $504 million.
The beleaguered retailer spent more on advertising than it has in any of the last five years and made major changes to its media mix, under the direction of CEO Ron Johnson. TV advertising climbed, particularly network TV spending, while radio and internet display investments dropped. And despiteMr. Johnson’s declaration late last summer that the retailer would invest heavily in newspapers, spending in that category was down slightly.
JC Penney reported that its fourth-quarter net loss widened to $552 million. The retailer posted an annual net loss of $985 million.
Sales in the fourth quarter, which includes the holiday-shopping period, slid 28% to $3.88 billion. For the year, sales fell 25% to $12.98 billion. That marks the lowest annual revenue the retailer has reported since at least 1987.
“It’s the worst performance that I’ve ever encountered in decades of covering retail — there’s nothing really to compare it against,” said Bernie Sosnick, an analyst at Gilford Securities.
The first table below shows what kids 6-12 are interested in “buying” in the next 6-12 months. (By “buying” we assume Nielsen means, “getting,” unless these are some industrial kids who are running killer lemonade stands.) The second table shows what consumers 13 and over want.
As you can see, the iPad is the number one product people want in the next year. That’s got to be scaring the heck out of Microsoft. Because if you’re 6-12, and your first computer is an iPad, what are the odds you buy a Windows computer down the road?
With Halloween behind us, retailers are now full swing into the Holiday shopping season. And consumers aren’t too far behind. By the end of October, a little more than half of consumers surveyed said that they have begun their Holiday shopping. In fact, 1 out of 10 consumers have completed at least half of their expected Holiday shopping.
Toys and games, electronics, and gift cards were popular gift items to purchase last week. And while 1 in 3 consumers bought books the week end Oct 16, only 14 percent purchased books last week. Santa was in a part mood last week, as can be seen by the jump in event ticket purchases.
Overall spend increased, probably do to the increase in higher ticket value items. The average consumer spent $190 dollar online and $264 dollars in-stores on Holiday gift and items. At this point in the season, consumers are still favoring in-store purchasing.
And where are consumers spending all of those in-store dollars? Walmart, Best Buy, and Kohl’s were the most popular retailers to shop at last week. Macy’s saw a large jump in foot traffic, probably due to their Party & Holiday Home sale.
Compete Holiday Insights™ will be your source for tracking consumers’ online and offline holiday shopping, so stay tuned for more posts like this in the coming weeks.
Dr. Augustine Fou is Digital Consigliere to marketing executives, advising them on digital strategy and Unified Marketing(tm). Dr Fou has over 17 years of in-the-trenches, hands-on experience, which enables him to provide objective, in-depth assessments of their current marketing programs and recommendations for improving business impact and ROI using digital insights.
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