Martha Stewart’s alliance with JCPenney

RetailWire panelists commented today on the alliance between JCPenney and Martha Stewart Living (including Penney taking an ownership position in MSL). The retail world is watching carefully for every move that Ron Johnson makes, but I have mixed feelings about it:

I’m not sure this is a “transformational” move for JCP but it’s a good one. I happened to walk a local Penney store yesterday (one of its small prototypes) and was struck by the lack of presence in cookware and small electrics compared to Kohl’s. Meanwhile JCP continues to devote signicant space to window treatments and lamps among other businesses. Without having personal knowledge of the numbers, I wonder whether all that real estate is as productive as possible.

The alliance with Martha Stewart does raise a few questions:

1. Does the brand really help JCP reposition itself toward the younger demographic not being reached today?

2. Does an expanded selection of home goods really lend itself to the “genius bar” concept?

3. Will JCP take the steps needed to expand its “kitchenware” business or simply re-brand existing product categories with the Martha Stewart insignia?

The underlying question for Martha Stewart is whether the JCP alliance is a long-run win. If she loses Macy’s business as a result, she also loses some of Macy’s aspirational aura and younger demographic.

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