J.C. Penney Sale Prices Mislead Customers, Employees Say

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jc penney sale prices savings retail tags
Gene J. Puskar/AP
By Treye Green

Struggling retailer J.C. Penney is facing new claims that its unbelievable deals are actually just clever exaggerations.

According to former employee Gena Stone and current Florida employee Bob Blatchford, the retailer marks prices up in order to later cut them, creating the illusion of dramatic savings, reports NBC Today.

This revelation from Stone and Blactchford follows an undercover investigation last month by Cincinnati news station WCPO into the mark up practices of the retailer. WCPO uncovered that J.C. Penney (JCP) was placing new price stickers over older ones and then marking the items down to mislead consumers.

In her store in Virginia, Stone says, "All of a sudden, the rack of $7 shorts became $14, and then they were 50 percent off."

When asked what she told her bosses who instructed her to make these changes, she says she complied but wasn't comfortable doing so.

"They said it was coming down from corporate in Texas," Gena said.

The Huffington Post uncovered another example of altered pricing with the controversial "Hitler teapot" the store sells.


The Michael Graves tea kettle was priced at $40 back in May. But on the retailer's site this week, the item's "original" price jumped to $58 and the "sale price" moved to $39.99.

As of July 25, the store's site has again been altered to show only the kettle's original price of $58.

NBC Today found a Dyson vacuum cleaner at the store that was advertised as on "sale." It was regularly priced at $725 and marked down to $649. But after checking with the actual manufacturer of the vacuum, it was uncovered that the J.C. Penney sale price was the same as the manufacturers suggested full retail price.

Speaking to NBC Today, J.C. Penney said that any items that are marked down must be "previously sold at ... regular price for a reasonable period of time."

"While we understand this transition back to promotional pricing may cause some temporary confusion, the company remains committed to delivering the quality, price and value that customers expect from J.C. Penney."

Priya Raghubir, a professor of marketing at New York University, told NBC Today that the pricing tricks being adopted by J.C. Penney are implemented by numerous stores in the retail industry.

J.C. Penney recently removed their CEO Ron Johnson after his failed attempt to overhaul the company and its image. His removal of the stores coupons and flurry of sales throughout the year alienated many customers, leading to large declines in store sales both online and in retail locations.

Former CEO Mike Ulman was brought in to try to turn things around. He has since brought back both coupons and sales.


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177 Comments

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Bonnie

I have the solution for Penney's survival as well as becoming a huge success. Just drop into Bealls department stores and you will see success. They have the secret. I have no desire to shop Penneys since they are depressing! No huge linen department, drapes and curtains galore, beautiful spreads and comforters, household goods, small appliances, aisles piled high with every size of clothing, womens, misses, mens, etc. Anything you could find at Penney's. Now, doesn't even resemble the stores that I so loved. Penney's....copy Bealls!!!

August 02 2013 at 3:13 PM Report abuse rate up rate down Reply
Bob Brown

To the "tell all" employees who are singing.. :) Did you really think we didn't know that? A good buy is a good buy, whether its "on sale", discounted or not.

July 29 2013 at 11:58 AM Report abuse rate up rate down Reply
Teresa Johnson

True True Pennys and other stores try to mess you up with the 50% it is just unreal

July 29 2013 at 11:38 AM Report abuse rate up rate down Reply
eyedocandynj48

JCP IS A PIECE OF CRAP AND ALWAYS SCREWS CUSTOMERS

July 29 2013 at 11:18 AM Report abuse +1 rate up rate down Reply
Marsha

I worked retail for 25 years and to compete and survive when Kohls came to town, we had to discontinue our normal discount pricing and mark up to manufacturers suggested retail and then run the 40 and 50% off "sales" as they did. Pennys is only going back to the way they use to do business. People just need to see the 50% off sales to feel they are getting a good deal, when in reality they are paying more. Look at Hobby Lobby for instance. There is no way you would pay their regular retail for their mdse, but every week, they run 50% off certain catagories, and they stay busy!

July 29 2013 at 11:10 AM Report abuse +1 rate up rate down Reply
Sandi

Kohls does the same thing, I've seen three different price tags on towels that I bought for my daughter with high, low, high and then the sale price.

July 29 2013 at 11:07 AM Report abuse +1 rate up rate down Reply
Mrs.Cohen

Yes, this is a common practice in the retail industry. HOWEVER, to NOT REMOVE the old lower price on the ticket, is idiotic. Whenever the department store in which I worked had a price increase, we had to remove the old lower price by cutting it off. Poor management decision of Penny's, not to do the same. Once again, they need new management!

July 29 2013 at 10:34 AM Report abuse +1 rate up rate down Reply
Mrs.Cohen

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July 29 2013 at 10:30 AM Report abuse rate up rate down Reply
Hi ya Dale!

That is one of the oldest and sneakiest tricks in the retail business. I wonder if they are doing it on all sale merchandise or just a couple? Not that it matters much. I thought Penny's was going to get better now that they kicked the idiot out. But now they're a little closer to the bottom. I won't trust them any more. And the first credit card my wife and I ever got right after we were married 46 years ago was a Penny's credit card. They've come a long way since then. All down hill.

July 29 2013 at 10:29 AM Report abuse +1 rate up rate down Reply
D Nelson

The comment about KOHLS is right on the money. KOHLS is very guilty of this and it's more than obvious.

July 29 2013 at 9:57 AM Report abuse +1 rate up rate down Reply