Penney on Fast Track with New Fashion Line

Discussion
Aug 11, 2010
George Anderson

By George Anderson

J.C. Penney is looking to pick up the pace of its fashion
sales with the launch of a new, exclusive line created for the department store
chain by fast-fashion retailer Mango MNG Holding SL of Spain.

Back in December
of last year, when the deal between the two companies was announced, Penney
CEO Myron "Mike" Ullman said, "Fast fashion
for the young, modern woman is our highest-potential business opportunity …
The Mango name has become synonymous with fashion at a moderate price and for
innovation in creating quality merchandise at enormous speed."

Mango is known for
being able to go from design to finished product in stores within four weeks
keeping pace with the changing tastes of young adult female consumers. Penney
is hoping the MNG by Mango line will help bring more of those shoppers into
its stores and onto jcp.com to buy.

Liz Sweney, executive vice president and general
merchandise manager of women’s
apparel at Penney, told The Wall Street Journal, "We’re great in
teenage space, and really good once a woman has her first baby or buys her
first home, but weaker with that early 20-something, early 30-something customer."

The
line will launch in 77 Penney stores on Aug. 18 and be sold in 600 of the chain’s
stores by the fall of 2011. In-store boutiques featuring the line will be made
over every two weeks, twice as fast as Penney’s other fashion brands, according
to the Journal.

Discussion Questions: Has fast-fashion become a requirement in retailing
today or does the traditional means of sourcing apparel still work? Do you
think the exclusive MNG by Mango line will help J.C. Penney gain share of
the fashion business with females in the early 20 to 30 age range?

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9 Comments on "Penney on Fast Track with New Fashion Line"


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Paula Rosenblum
Guest
10 years 8 months ago
I’m a little confused about the timing of Mango’s “Fast Fashion.” Does that include time from port to shelf? If so, I cannot believe product will get onto the shelves in less than 8 weeks (4 weeks transit time if we’re lucky). You know, “traditional sourcing” isn’t all that old. As you may recall, the HBO documentary Schmatta pointed out that as late as 1975, 95% of all apparel sold in the US was MADE in the US. You could certainly be faster then than you can now–where designers could literally walk across the street to factories, examine samples and get product out there. We’ve gotten ourselves into a bit of a mess. Neither can designers dictate what customers will WANT, nor can they respond fast enough to actually DELIVER it when the customer wants it. And history is proving that this spend is discretionary, and can be bypassed pretty easily. I just don’t see how “fast fashion” and “low-cost country sourcing” can be uttered in the same sentence. And I have looked at this… Read more »
Camille P. Schuster, PhD.
Guest
10 years 8 months ago

Fast fashion may be fast for Penney’s but is still slow for Zara or H&M. Providing fast revolving choices is part of the appeal; having fashion choices that appeal to the consumers is another part; having the right prices is another part. All parts of the equation need to be right to be successful.

Carol Spieckerman
Guest
10 years 8 months ago

J.C. Penney’s partnership with Mango continues to get portrayed as a foray into fast fashion when in fact JCP has quietly become one of the faster fashion players in an otherwise clunky department store arena. Through its factory to store system, they have managed to chisel a two-year concept-to-consumer timeline down to 45 days or less.

I would therefore portray the partnership as a strategic brand alliance, one that will give J.C. Penney access to an international brand and a distinct point of view (sorely lacking in the sea of undifferentiated brands currently piling up there, if you ask me). Mango will hopefully bridge the gap between Penney’s blingy tween offerings and its often matronly mega brands (Liz, American Living, etc.).

Ryan Mathews
Guest
10 years 8 months ago

Being “fast” isn’t a positive if you are rushing the wrong products to market. And, as has been noted above, fast means different things to different companies. The trick is to get young people to want to put those clothes on–and speed is only a very small part of that equation. Let’s see Michelle Obama wearing those clothes first (ala J. Crew)–then figure a way to get them to market quickly.

Dick Seesel
Guest
10 years 8 months ago

J.C. Penney has found the twenty-something customer elusive in its stores, and perhaps the alliance with Mango will fill the gap. The underlying problem, as I see it, is the relentless private brand proliferation at JCP where nothing stands out.

JCP introduced two new junior/kids brands for BTS…what did they eliminate? And when they become the exclusive provider of Liz Claiborne-branded apparel this fall, what will they edit out of their assortments in order to make Liz look more important? JCP will continue to pose the question, “Who knew?” in its TV ads as long as it hides its most important brands in the middle of a bunch of “stuff.”

Gene Detroyer
Guest
10 years 8 months ago
Fast Fashion is a real category and the category centric department store model must participate in it. Penney’s is right to hang its success on a noted brand. However, the real question is if Penney’s can actually execute Fast Fashion. Not only is the entire operational structure different in Fast Fashion than department store operations, but the mind-set is completely different. If Fast Fashion is going to succeed in Penney’s or any other department store, it has to be run out of a completely different buying and merchandising group than the rest of the store. There is no summer, fall, winter, or spring in Fast Fashion. There is no overstocking in Fast Fashion. The Fast Fashion objective is to run out of stock in a particular item and replace it with something new. The Fast Fashion philosophy is to create urgency on the shoppers’ part to purchase today, because it won’t be there tomorrow. Fast Fashion does not rely on overbuying offset by deep discounting. This will be a challenge for any department store.
David Reinke
Guest
David Reinke
10 years 8 months ago

Speed, speed, speed. This is the mantra apparel retailers and wholesalers have been uttering for the better part of two decades. However, few have successfully implemented speed-to-market models that can be executed for more than a thin slice of their overall line.

While typically behind the curve, the department stores are actually in a good position to innovate in this area because their development process requires less functional coordination than wholesalers and many true vertical retailers (no sales people and merch/sourcing are often combined roles).

As retailers focus on cutting time to market, I urge them to also consider how they can improve their hit rate at identifying which styles will be their best performers. Regardless of when you make the decision, this is the ultimate question. How retailers perform at matching supply with demand is the key indicator of sales performance. Making style-level inventory commitment decisions is easier the closer you are to market but there are also other ways to juice style picking accuracy.

Ed Rosenbaum
Guest
10 years 8 months ago

My good friend Paula Rosenblum reintroduced us to a past generational word “Schmatta”. That takes me back to the time when my uncle and two brother-in-laws had a “schmatta” business selling their lines from Maryland through North Carolina. And yes, all the lines were manufactured in the U.S.

Back to the discussion about J.C. Penney’s new attempt to catch up to their competition. If this puts them on the fast track then I am for it. I am not that certain they have developed the marketing plan to let the potential customers know about it. In fact, I don’t think I can describe Penney’s marketing plan? I will add they have initiated a contract with the PGA to be the exclusive retailer to sell their brand of shirts. Penny’s did not tell me they carried this brand. A friend did.

Ted Hurlbut
Guest
Ted Hurlbut
10 years 8 months ago

I find that the more I learn about fast fashion, the more questions I have. The concept calls for frequent (timely) deliveries of styles in smaller quantities. This implies the goods must turn quickly. Clearly, prices are at hot-button price points to drive quick sell-throughs. Are these retailers also working at short markups to assure these quick sell-throughs? What does that suggest about the cost structures of these businesses, especially if “quick” means flying goods?

All of this raises the question in my mind of whether Mango’s business model is workable for Penney. Obviously, if a retailer like Penney could profitably adopt a fast-fashion model, it would be to their competitive advantage. This is an alliance that bears keeping an eye on.

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