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Digital investments key factor in sales growth at J.C. Penney

Unlike its competitor Macy's, J.C. Penney is celebrating a sales spike despite warm weather that hindered apparel sales this holiday season and credits its omnichannel strategy as a key driver.

January 7, 2016

A successful omnichannel strategy is a key factor in J.C. Penney Co.’s 3.9-percent gain in same-store sales this past holiday season and is helping the retailer weather the storm of slumping winter apparel sales that hurt competitors.

"Despite unprecedented warm weather that significantly affected apparel sales across the company, our focus on private brands, enhanced omnichannel execution and compelling gift giving selection resulted in strong holiday sales," CEO Marvin Ellison said in the statement, according to Bloomberg.

In comparison, big competitor Macy’s experienced a 4.7-percent sales dip and has announced layoffs and a workforce restructuring due to weaker than expected sales.

J.C. Penney launched a turnaround strategy in 2015 and Ellison states the sales results illustrate the strategy is working as the company will enjoy free cash flow this fiscal segment for the first time in the past three years. The turnaround, according to Bloomberg, has included revising the supply chain and technology running the system, and expanding its portfolio of private brands.

"We have much work to do," Ellison told the Wall Street Journal, noting he expects to see more good results in 2016 from investments in digital retail efforts.