Will J.C. Penney find success with its new B2B venture?
Marvin Ellison is letting his Home Depot roots show once again. J.C. Penney’s CEO is behind the department store chain’s latest venture, which involves selling items such as linens, towels, mattresses, towels and appliances directly to hotel operators, property management companies and other businesses placing bulk orders.
“The U.S. hospitality industry represents approximately $200 billion annually and a significant opportunity for J.C. Penney to gain market share and drive increased revenue per customer with major appliances and a renewed focus on soft home goods,” said Mr. Ellison, in a statement released last week. “Our entry into the B2B program reinforces our home refresh initiative, while providing new and innovative ways to achieve sustainable growth and profitability.”
Mr. Ellison said the idea for the new venture came from the business the chain was already doing with hotel operators who were placing large orders on Penney’s website for bedding, bath and window treatments.
Business customers working with Penney will receive bulk pricing, commercial credit offers and tax exemptions, as eligible. Penney will also enable business clients to customize orders working with its team of dedicated, outside B2B consultants.
This is not the first time that Mr. Ellison has taken a page from his time at Home Depot. That chain has succeeded, in part, by catering to the needs of contractors and other construction business professionals. It also offers a wide variety of installation and remodeling services directly to consumers while becoming a significant competitor in the major appliance category.
Since joining Penney, Mr. Ellison has been behind its test and subsequent rollout of major appliances to 500 stores. In March, the chain announced the launch of a pilot program to test a bathroom remodeling service. This was in addition to a previous deal signed with Trane to install heating and air conditioning equipment.
Penney, Mr. Ellison has said, will succeed in its new ventures because consumers “trust the brand.”
- JCPenney Emerges Into B2B With Solutions That Cater To The Hospitality and Property Management Industries – J.C. Penney Company, Inc.
- Will being more like Home Depot work for J.C. Penney? – RetailWire
- Own some rental properties, maybe a hotel franchise? J.C. Penney wants to make you a customer – The Dallas Morning News
DISCUSSION QUESTIONS: Do you see B2B sales as a category in which J.C. Penney can achieve significant success? Are you encouraged or concerned that many of J.C. Penney’s initiatives developed to drive its business seem to be copycat moves borrowed from Home Depot?