JCPenney Shreds Brand Equity Along with Unsold Ralph Lauren Merchandise
File this one under WTF: JCPenney (JCP) employees were instructed to trash unsold merchandise from its exclusive American Living line manufactured in collaboration with Polo Ralph Lauren (RL). Staff in Pittsburg's Beaver Valley Mall location got on the horn to the local television station right after being instructed to destroy a host of goods. Ironically, this (misguided) company policy is part of JCP's attempt to preserve the brand's equity. If management (both at RL and JCP) had taken some time to think about the implications -- and come up with a more creative solution -- they wouldn't be in deep PR sh*t right now.
No doubt Penney's wants to continue to bask in the burnished glow issuing from a partnership with Lauren, an American design icon with a Midas touch. However, when the Texas-based department store chain issued this statement via a spokesperson:
For a company like ours, in our business, your brand is your most valuable asset. The most important thing is to protect that brand. And with a few items in the American Living brand, if the brand name is actually on the product, our policy is to destroy it.
It sounds like Penney's drank a little too much of Lauren's red-white-and-blue Kool-Aid. Indeed, the retailer's agreement with the designer (which had a hefty $1 billion sales carrot dangled in front) stipulated that unsold apparel and home furnishings with labels and logos that could not be removed without damaging the merchandise had to be destroyed.
No doubt it was a tough decision for Ralph and company to peddle their haute pony-emblazoned merchandise in the aisles of a down-market department store. The designer got around this by drawing up a whole new logo (with an eagle) and slapping on a grand name. Subsequent advertising was done in true RL style, all fresh-faced models shot in artfully distressed clubby surroundings. So Penney got the brand cred without all the fancier trappings and the higher prices.
However, in order to save even his non-pony-stitched togs and home goods from the bargain bins of T.J. Maxx and Marshalls (TJX), and Big Lots (BIG) -â€" a fairly common practice among retailers with overstock -- Lauren wrote that little destruction clause into the contract with JCP.
Ralph Lauren could have easily come up with an alternative, eco-friendly solution instead. The company's initiative to provide tents for displaced survivors of the earthquake in Haiti comes immediately to mind. Why not use the scraps to make tents? Or, if that's not appropriate, just send the unsold bedding, shirts, and baby clothes to the refugee camps that have sprung up all around Port au Prince. Or, keep it local and send it to one of RL's Habitat for Humanity sites. That's a tax write-off and a feel-good public relations move.
Even better, team JCP could work on a solution independently. Taking a page from H&M's playbook, the retailer could get busy designing and manufacturing an eco-friendly, fashion-forward line (at a low price point) to distract customers from this debacle.
Image via jcpenney.com
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