After all, the program indeed seemed to attract customers — and that hasn’t been the store’s strong suit lately to say the least.
JCP posted its worst earnings report in nearly 40 years for Q1 and didn’t fare much better in Q2 as same-store sales continued to sink. It also suspended its dividend and withdrew guidance for the year.
New CEO Ron Johnson’s first order of business when taking over was to get rid of sales by introducing everyday lower prices, but soon found the move was getting rid of customers as well.
Since then, the brick-and-mortar retailer has been doing anything possible to stop the bleeding. The free haircut program, which will start up again in November and be free every Sunday, is just the most recent move.
J.C. Penney also announced price cuts this summer — after, of course, re-introducing the word “sale” into its vocabulary — and introduced in-store shops featuring brand names like Levi’s, Izod and Martha Stewart (NYSE:MSO).
And if the company’s shares are any indication, the moves seem to be working at least to an extent. JCP has gained nearly 30% in the past month, slowing year-to-date losses to under 20%.
The company still has a long way to go in its attempt at a turnaround, though, and faces tough retail competition from all over: Sears (NASDAQ:SHLD), Macy’s (NYSE:M), TJX‘s (NYSE:TJX) T.J. Maxx and Marshalls stores, Ross Stores (NASDAQ:ROST), Target (NYSE:TGT) and even Wal-Mart (NYSE:WMT) are battling for the same penny-pinching customers.
Plus, its latest rally may just be a result of short sellers taking their profits. And if that’s the case, J.C. Penney may need more than a few free haircuts to truly turn things around.
As of this writing, Alyssa Oursler did not own a position in any of the aforementioned securities.