I read a very interesting news article the other day that detailed the ouster of JC Penney CEO Ron Johnson. It seems that under the 18 months that Johnson helmed the company, sales at their stores had taken quite a nose dive. The finger of blame pointed straight at the embattled CEO who had institued a policy of "fair and square pricing" early on in his tenure. This policy was meant to put an end to the silly game of listing artificially high prices on all of the store's retail prices that were then put "on sale" to lure customers in with promises of deep discounts. This is a standard retail trick that amounts to blatant fabrication (where the word "fabrication" is equivalent to the word "lie") in the store's marketing and relationship with the public. Not a single item has ever been sold with the list price on the tags that are being marked down through these purported great sales.If a store is being honest, a sale should be a temporary mark down of prices from the regularly listed price that the object normally sells for. This dishonest gimmick to trick consumers infuriated Johnson and he believed that all this gamesmanship was a thinly veiled charade that people could see right through. He thought it was an insult to the intelligence of the shopping public and that they would be better served with an honest listing of prices.
Now I grant you that Johnson's approach is wholly logical. But hold on a moment. You forget that we are all sheep. Bleating, grass chewing, insipid ovine creations. It turns out that studies have shown that customers don't really want honesty. What they really want is to think they are getting a great deal, whether they are getting one or not. We are all easily swayed by price, apparently even a list price that is comically inflated. It makes it so much easier to justify out pulling out the old plastic charge card.
"Oh Mabel, this tag says that this basic white Hanes t-shirt normally sells for one billion dollars, but it is marked down to $1.99 for this week only. I had better grab a whole stack of these priceless treasures before these suckers figure out what they have done."
Goodbye Mr. Johnson and your clearly insane ideology.
