Struggling retailer J.C. Penney (NYSE:JCP) is reversing course and will resume discounting products.
Investors were enthusiastic about the policy shift, sending J.C. Penney shares surging about 6% in Tuesday morning trading.
The department store chain adopted a “no sales” policy after former Apple (NASDAQ:AAPL) executive Ron Johnson became CEO in 2011. In the place of regular discounts, the store promoted a strategy that stressed “everyday low prices,” the Wall Street Journal noted.
Consumers, however, were unimpressed with the chain’s new direction. Sales fell more than $2.7 billion during the first nine months of last year.
Facing continued sales declines, the company now says it will offer targeted discounts during specific times of the year, including Valentine’s Day sales on jewelry.
The retail chain is also facing a lawsuit from rival Macy’s (NYSE:M) over its licensing deal with Martha Stewart Omnimedia (NYSE:MSO). The chain was hoping that the domestic diva’s brand would help bring customers back to its stores, but has restrained the brand’s presence as the lawsuit goes to court next month.