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Saturday, March 2, 2013

"Home is not the sexiest of categories."

As hard as it is to fathom, many people have little interest in their homes other than to provide comfortable shelter. The latest happenings of Robert Couturier, Steven Gambrel or even Nate Berkus hold no fascination. We call those these people BLASPHEMERS!! or, more accurately, the majority of the population.

It may surprise you to learn home goods are often some of the lowest-margin, slowest-moving items department stores carry. As a New York Times writer yesterday plainly put it, "Home is not the sexiest of categories." Ron Johnson, chief executive of the struggling JCPenney, recently stated that home items as a category "made $185 per square foot in 2007, but now made less than $80" for JCP. In comparison, Penney's current overall sales now average $279 per square foot (an important metric of a retailer's financial health) in its renovated stores.

Image via Ashley Lutz for Business Insider.

Johnson is locked in a court battle with Terry Lundgren, the head of Macy's, over the Martha Stewart brand. Stewart's longstanding partnership with the American middle-market retailer was thought to be exclusive, until she announced a new line for Penney's in December of 2011.

"[A]n exclusion in the Martha-Macy’s contract for Martha Stewart’s own stores" allowed the goddess of good housekeeping to create her own stand-alone stores. Stewart claimed some wiggle room in that particular definition and "argue[d] that the Penney stores-within-a-store [concept] count[s] as a distinct Martha store." Girlfriend wants to have her Sylvia Weinstock-decorated cake and eat it, too.

So why are these two retail behemoths fighting over what Macy's Lundgren (the lovechild of Pierce Brosnan and Butt-head) described as “generally the least profitable part of the store”? Home goods sales are tied to the housing market and a strong recovery is on the horizon. Exclusive products offer customers an incentive to bypass big box retailers like Target and Stewart's former dance partner, Kmart.

Jonathan Adler for JCP.

Johnson is overseeing the renovation of "an average of 19,000 square feet in each [Penney's] store to feature its new store-within-a-store home emporiums." Target's former main home man Michael Graves will be featured along side Happy Chic purveyor Jonathan Adler with the anchor being the Martha Stewart brand. Graves' and Adler's boutiques bow this month, while Stewart's shop concept remains tied up in litigation.

Michael Graves for JCP.

With her finances more curdled than an untempered flan, Stewart desperately needs this new partnership to work. Martha Stewart Living has been losing money for the past three years, and "[i]n exchange for the Stewart line, JCPenney made a hefty stock investment in Martha Stewart Omnimedia and revitalized the company's finances."

Dumplings, do you buy Martha Stewart items from Macy's? Would you be inclined to do so at JCPenney's? And will you be checking out Jonathan Adler's and Michael Graves' new JCP goodies?

Penney's and Macy's Battle Over Martha Stewart Products [The New York Times]
Martha Stewart Is Headed Back To Court For An Ugly, High-Stakes Battle With Macy's [Business Insider]


My Crafty Home Life said...

I buy the Martha brand from KMart. I have been at social media war with JCP because of the idiot practices they do with online orders. Apparently "free shipping over $75" requires a coupon code. This will prevent you from using any of the other coupon codes for other discounts. Target, Macy's, Kohls, etc....either have the automatic price point free shipping activated, or they allow you to enter two coupon codes. Time will tell on all of this.

Raina Cox said...

My Crafty Home Life - JCP has been in hot water with loyal customers ever since Johnson came on board. He's determined to eradicate couponing from retail.

eddielicious said...

Nobody except JA could make me set foot in a JCP store...Just like he got me to HSN!

Raina Cox said...

eddielicious - I cut through JCP to get to our mall's parking garage. I always wonder about the fire hazard of all those synthetic materials. BOOM.

David said...

Our Macy's are too much in-house brand and not enough brands I like. I will occasionally buy a shirt or something, but I don't even look for home things there.

I would look at the Jonathan Adler and Michael Graves shops. Michael Graves made clothes hangers for Target that are some of the best hangers I've ever used. If he does something similar for JCP I'm all over it.

life, in small chunks said...

While not in love with any of their product, I do like their very public policy of gay rights issues and would shop with them for that alone, if only they had things I like. I am apparently the only person alive who is not a huge fan of JA. I'll have to see what MS products they come up with.

Raina Cox said...

life, in small chunks - I'm a huge fan of JA as a person, but I don't love his decorating aesthetic either.

mistress maddie said...

This is a very intresting post! And I love your humor to it! I work in retail as a visual stylist for Bloomingdales, and we just got rid of our whole home department! It was just not working for our location, it's all about the fashion. No, these names will not get me into these stores, as the layout is sooooo claustrophobic, I can't stand it. But I adore Jonathan Alder and visit his own shop in center city Philly. I may check out Nate Berkus' wear at Target, but I'm hearing they are not of good quality. Just give me a good antique shop or vintage shop any day!

Lane said...

JA did some inn rooms over in my town (ME); very, errr, colorful; not my thing.

I was forced to go to a mall out of state preparing for some guests and happened upon an excellent ice bucket from MS, key to the comfort of our guests in our barn. I am obsessed with houses; in mourning that a fabric I had hoped to re do my bathroom chair has been discontinued.

The Down East Dilettante said...

Way back when she did the K-mart thing, I bought a few odds and ends. The line was a triumph of looks over quality. Almost everything fell apart, ripped, faded, broke, before its time. Hence I've never even turned my head toward the stuff at Macy's.


Jessie said...

I rarely shop at JCPenny but if I happen to go to the mall, I will definitely check out JA's stuff there!


Bromeliad said...

It's not sexy because the products in most stores are wugly.

Raina Cox said...

Bromeliad - Tru dat.

hush said...

JCP is, to my questionable tastes anyway, a treasure trove of great bargains. Who knew? I'm drooling over Nigerian designer Duro Olowu's homegoods for JCP. And I love me some J Adler, so this is fantastic news.