JCPenney to differentiate with Croscill sheet rollout

Gary Evans, Carole Sloan, May 28, 2001

PLANO, TX — The JCPenney launch of Croscill's new solid color sheet program is viewed as a major step in positioning and differentiating the retailer from competition.

The program, under the banner Croscill Classics, is called the "310 Collection" denoting its thread count, "and represents fashion in a business that is more challenging" than any other in the home textiles world, explained Charles Chinni, senior vp, gmm, home and jewelry.

The "310 Collection" will rollout initially in July to "our top 42 department stores, followed by a second rollout to 160 more stores in August and a third rollout in September to 298 stores," Chinni said.

The sheets, made of a 310 Supima cotton sateen with a silky hand, will be offered in six colors, with the fitted sheet a deep pocket of about 17". A simple floral tone-on-tone coordinate with a pearl like finish is planned to work with the solids.

The fabric is woven in Thailand, and fabricated in Croscill's facilities in North Carolina.

Chinni, who reviewed the plans for home textiles in an interview here before the firm's annual meeting earlier this month, observed that the sheet segment of the business "is vulnerable at any time" to competitive pressures. "It has been volatile for many years," he added.

Penney, in its transformation, "is faced with positioning this business for our core customer," as well as being alert to competition. "And we also have to make sure that our fashion customer will be served. We see the Croscill sheet at JCPenney as representing fashion."

For sheets as well as the rest of the home textiles divisions, and extending throughout the store, "our challenge is to assort and promote effectively. We're narrowing our assortments and intensifying our focus. More stores will be carrying the same assortment and following the promotional plan," Chinni emphasized.

But in planning assortments he noted, "my approach is to look for similarities rather than differences. This will maximize our efforts. But I'm also sensitive to local needs."

Discussing the towel business Chinni observed, "This is a traditional strength of the company. The JCPenney towel is a tremendous force in the market. It's the focus of our strength, with great quality and value making the success."

Chinni's plans call for "building around the JCPenney towel — starting with our promotional point of view and moving above it to fashion. We have an enormous opportunity in fashion towels — jacquards and embellished."

The Royal Velvet towel, now carried in 408 stores, "has performed well over the years, and we're looking to expand it to more stores. It has instant recognition."

Sheets and towel assortments will be built to maximize promotional events, Chinni explained. "These will be in-line promotions, with a relatively small opportunistic buy plan. We will build our assortments to offer value every day and with the promotions, added value."

In towels, he said, "We will be competitive at opening price points, and we're working on this. The middle is covered strongly, and we're developing the better end." Towels, he added, "have more options" for differentiation with private label and fashion as well as Royal Velvet as a national brand.

"We're not pursuing other brands. We'll build private label and unbranded product. There are plenty of towel makers who have the ability to produce for us."

In sheets, however, "there is little opportunity for private label. Thread count promotion allows more aggressive promotion and creates a price-driven business. The perception of thread count is price-driven, but I think the worst might be over in sheets."

In window coverings, where Penney has the dominant position, "the issue is how to protect and grow the business" in the face of increasing competition from Home Depot, Expo Design Centers, Linens 'N Things and Bed Bath & Beyond, Chinni remarked.

According to Chinni, table linens will also get a new focus as Penney expands its housewares assortment.

The promotional approach will be a critical part of building assortments and gaining market share, Chinni related. "We're building our sales promotion calendar to emphasize more weekend [Thursday or Friday] promotions."

The new ratio, he said, will be about 60 percent Sunday, 40 percent weekends.

While the company is not planning to open new free-standing home stores in the near future, "we're developing plans to focus on the 39 stores and plan merchandise separately for them and develop promotions just for these stores." Some are profitable, others are not, he noted.

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