A recent article from Forbes discusses the "store within a store" retail model that JC Penney's CEO Ron Johnson implemented since he took the helm of the struggling department store chain. According to the article, Johnson is likely going for a staging effect on customer experience as a way to increase sales — much like the Apple stores he influenced before.
An excerpt from the article reads:
Bringing it back to retail, consider walking into an Apple retail store. Now, consider walking into some other retailer — use your own example — with a less thoughtful physical layout. It seems that this is where Mr. Johnson believes he will make a difference. His success with Apple's retail store is in part due to their staging's effect on the customer's experience. And, most certainly, he believes that he can extend this concept to J.C. Penney.
Beyond the aspect of staging, there are potential operational benefits of the store in a store model. With the majority of staffing of stores coming from the product makers themselves, J.C. Penney might have lower overhead expenses. With each product maker operating its own "store", the product makers would have greater control over sales, which might increase sales. Given a sales override, higher sales by the product makers would lead to higher income to J.C. Penney.
Read more about store design and layout.
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