September 26, 2014
Ron Johnson is getting back in the game
Ron Johnson, formerly of J.C. Penney, Apple, etc., is getting ready to launch a new venture that Jessica Lessin of The Information website describes as "Best Buy’s Geek Squad meets Apple’s Genius Bar."
According to the report by Ms. Lessin and another by MacRumors, Mr. Johnson’s new venture will be an upscale, on-demand delivery service for hi-tech gadgets. Mr. Johnson, according to both sites, has also looked to recruit former Apple employees to join him in his new venture, a public first since his disastrous tenure as CEO of J.C. Penney.
While many applauded Mr. Johnson’s vision for appealing to a new, younger consumer at the department store chain, he quickly alienated existing shoppers who fled to other outlets when he discontinued popular brands and eliminated the steady stream of promotions they had come to expect from the retailer. Reports of unhappiness among rank and file employees began to surface not long after Mr. Johnson replaced Mike Ullman as CEO. Mr. Ullman eventually returned to Penney in April 2013 as interim CEO and remains in that position today.
Mr. Johnson is no doubt looking to recapture the magic at Apple that led him to be recruited for the top spot at Penney in 2011. At the time, he told Bloomberg News, "It’s our job to rethink everything. Retailing’s always been about creativity; it’s about creating exciting new ways for people to shop, new products for people to purchase, new ways to do things."
It will be interesting to see, as more details become known about Mr. Johnson’s new venture, if he is able to put his creative vision into practice while learning from his mistakes at Penney.
- Former Apple Exec, J.C. Penney CEO to Launch Delivery Startup – The Information (sub. required)
- Ron Johnson Launching Gadget Delivery Service, Poaching Apple Employees – MacRumors
- Former Apple Retail SVP Ron Johnson reportedly working on gadget delivery service – 9to5 Mac
- Ex-J.C. Penney CEO’s new plan: Part Geek Squad, part Genius Bar – Minneapolis/St. Paul Business Journal
- Penney Offers Training Program for New CEO – RetailWire
BrainTrust
Recent Discussions
Discussion Questions
Has Ron Johnson’s unsuccessful experience at J.C. Penney overshadowed what he accomplished at the Apple Store? How do you think his previous experiences will inform his decisions going into his new venture?
Poll
I think two things:
- This is a solution looking for a problem, and
- What Ron Johnson learned at J.C. Penney is that he doesn’t want to work with the “masses” anymore because he doesn’t understand the way they think. That’s probably how he’s wrapped his head around that failure.
Still, it’s hard for me to understand what his goal is here, outside of eliminating single shingle and small businesses, who’ve been serving this market just fine for 20 years. So whether he learned or didn’t learn, I don’t see a viable business here.
The very best athletes recruited to help a team win a championship do not always work out. In team sports, it is not always about the skills of the premier player, it’s also about the chemistry of the team.
Ron Johnson’s talent and experience were not good chemistry at J.C. Penney.
The interesting aspect of this new venture is that does not appear to be store-based, at least in the traditional sense. It is a new concept, and that is where Ron Johnson’s talents may excel. Plus he is building his own team, not trying to turn around an aging franchise.
If there is ever an environment to unleash Johnson’s creativity, this one appears to be ideal. A great case study is about to unfold.
The fiasco at J.C. Penney overshadows not only his success at Apple, but his achievements at Target before that and probably the fact that he went to Stanford and Harvard Business School. That failure has come to symbolize his entire life, justifiably or not. Which is actually an opportunity to redeem himself in the court of business opinion. This idea looks interesting, although if it’s at all successful we can count on Amazon entering the business in force.
Well Johnson is right about one thing: It IS our job to rethink everything. I’m not sure how “Best Buy’s Geek Squad meets Apple’s Genius Bar” is evidence of a “rethinking.” Frankly that picture just makes me groan.
The biggest challenge for this type of venture is recruiting and retaining the caliber of talent that will not only understand the technical material but have the customer service skills to resonate with the customer. Mr. Johnson had the vision for J.C. Penney, he simply forgot to take the steps in front of him to get there. Know and respect your customers!
I can’t gather enough information about the new Ron Johnson venture to answer some of the following questions:
- Is it an e-commerce only site with the added benefit of “concierge” service?
- Will the site have access to the same products (like Apple) that shoppers can buy in multiple channels today?
- How will the service aspect of the business affect the pricing strategy?
If I can suggest one thing to Mr. Johnson: Test first, jump in with both feet later.
Magic rarely overcomes madness. Ron Johnson now carries heavy baggage from his J.C. Penney’s adventure. While Mr. Johnson will use his experiences in his new venture, the problem is that the future is not what it used to be. Hopefully a smart guy like Ron will know how to bridge that gap.
Not everything he touched turned to stone at J.C. Penney, not everything he touched turned to gold at the Apple Store and I am sure he has learned from his mistakes like we all do. That being said, I personally don’t see the need for an upscale, on-demand high tech gadget delivery service. I wish him well and hope it succeeds, but this just isn’t something I would take advantage of.
Ron Johnson appears to be someone that thinks a little bit outside the box, however I’m not sure that he his visions can be seen well enough by consumers that feel warm and cuddly “inside” the box.
When I followed the Penney debacle last year, I wrote a blog post under the name of Gilon Miller, “11 Ways Ron Johnson Presaged His Own Disaster At J.C. Penney (But Nobody Noticed.“
Many wrote (and I agreed) that Ron Johnson failed at J.C. Penney because:
- J.C. Penney wasn’t Apple.
- He misread what shoppers wanted.
- He didn’t test ideas in advance.
- He alienated core customers.
- He totally misread the J.C. Penney brand, and
- Messed up on competitive pricing strategy.
The key is, J.C. Penney wasn’t Apple, and Apple wasn’t J.C. Penney. Mr. Johnson seems more of a dreamer than a realist. Maybe Apple was his one-trick pony, and we can wonder if he’ll do his homework this time.
And if this new business idea is a viable one? Did anyone see any statistics on the need/demand for such a service? How would he do any better or any differently than anyone else who’s already in that market?
That remains to be seen, eh?
Ron Johnson’s performance and accomplishments at J. C. Penney are anything but unsuccessful. They are reaping the results of them today as the hapless Mr. Ullman only had to stand by and allow the results that they were headed towards in the first place.
There is no doubt that J.C. Penney’s current performance is a result of the foundation he began in creating a store that was different from the 1970s, current and more easily shopped, with product that consumers wanted to buy. Or, product that they could at least see to buy.
The only thing that has changed is the slow return from “JCP” to J.C. Penney, from a branding standpoint. Their current gains would likely have been even greater had they left that alone as well.
Even Mr. Johnson had re-introduced promotional efforts in a balanced way to allow the customer to determine value. That, instead of previously drowning the customer in so many promotions they were unable to realistically determine value. And the retailer was sinking in margin losses as they couldn’t determine value any better than the customer.
I’m quite sure that Mr. Johnson will be quite successful in his endeavor. J.C. Penney is far better off from him having been there.
All one has to do is check the headlines to ask the question: Is Apple really better off without him as well?
I was a fan of Mr. Johnson’s all the way to the end at J.C. Penney. Why? Because JCP needed a shot in the arm and Ron had all the makings. Still does!
What went wrong? His execution was poor and he didn’t think the old brand needed to factor into the new concept. Did that make his concept any less impressive? No! I thought what he was headed for at J.C. Penney was cool and spot-on for maybe a brand new concept with no baggage.
With that said, can he succeed in spite of the JCP debacle? Sure! Will he this time? Don’t know enough about the concept or the team to say if he can pull it off. But know for sure, he does have a great creative mind! And that, my friends, is my two cents!
If Ron Johnson’s tumultuous time at J.C. Penney didn’t eclipse his previous accomplishments, his post-Penney take on the experience did. While I actually applauded many of the initiatives he spearheaded at “JCP,” his hindsight portrayal of himself as a reluctant visitor thwarted by a hidebound culture, and his zeal in recounting multiple attempts at making an exit left a bad taste. Not exactly magnanimous. Not exactly someone you would recruit to author your turnaround story. Now, he’s taking the lead at a niche venture playing in a space that is growing more crowded by the minute, specializing in a category that is still finding its sea legs. Hubris hangover or genius market grab?
There is no doubt that Ron Johnson has a retail vision that is not only futuristic, it is also largely surrealistic. The fact that he has found money for this business plan is a good sign for an improvement in available disposable funds in the economy. The bad news is people will still throw away high-risk investment money by putting their faith in impossible dreams.
I’m excited to see what Mr. Johnson’s start-up offers and, as my interests are in the retail and technology sectors, I am curious to learn more about his new business concept of “gadget delivery, customer service and troubleshooting.”
Also curious to learn whether he is exploring commercial drones for this upscale, on-demand delivery service for high tech gadgets.
Amazon and Google are testing drone delivery systems and, once the FAA sets rules for “autonomous flights without pilots,” which may be by the end of this year, I’m betting commercial drone deliveries will become the upscale on-demand service. How do you compete with that?
Context is important when assessing one’s trajectory, and nothing goes up forever. Mr Johnson’s success at Apple was not replicated at J.C. Penney — different companies, cultures, and histories. Skills in a relative “startup” with Apple’s retail brand are not applicable in transforming an established and aging strategy.
Mr Johnson’s venture is a startup so that is a plus for him, yet the high touch approach and expected flawless execution may jeopardize success. It’s one thing to control all elements of a customer experience in an Apple Store versus working with frustrated consumers trying to enjoy their gadgets. This is a low margin, high detail, immediate gratification business.
Would I invest in this venture? Only with throwaway money and watch for the fast follower to get it right.
Well, I may stand alone on this, but I think it’s brilliant. Let’s face it, Geek Squad was one of the smartest things Best Buy ever did. (I don’t even need to mention Apple’s GB.) In the on-line age, a customer doesn’t have to go to stores any more. The expectation is that someone will bring whatever they bought to their house directly. So, to do that, then hook it up, no matter how complex … was/is advanced thinking.
Sooner or later, a tipping point is going to occur — if it hasn’t already — in that consumers will realize that the burden of fulfilling an order is no longer on them; no car, no parking lot, no searching shelves or prices, no installation. That burden is now on the retailer. Bring it to me. Do it for me.
Sounds like RJ’s experience with an advanced retailer and a dinosaur has taught him that the tsunami of “do it for me” is right at our doorstep. It will work, IMO.
No. His record at Apple was carefully crafted, and succeeded because of a strong brand which wouldn’t allow failure if the stores were poorly run. His ability to manage difficult retail situations was reflected at JCP. This venture sounds like it will go the same way.
Startups, like restaurants, have a high fall out rate, no matter who leads them. It will be interesting to watch, but I have my doubts about the viability of this one.
Understanding the consumer and the size of a market are fundamental. I think RJ didn’t understand the JCP consumer well enough to get that the changes would send them shopping elsewhere, and the “new JCP” consumer was going to take quite a while to show up. In the meantime, sales plummet.
Now for an equally viable new venture… How about a drone delivery pizza service — high touch, high taste, and avoiding traffic would make it possible to get even the thinnest crust home still piping hot.
It’s Friday….lighten up!
Good to see Mr Johnson back in the game!
I think his previous experience will only help him if he has a better mousetrap like the iPhone or iPad!
Hope RadioShack is watching closely.
It takes a totally different skill set to start a new venture then it does to run a successful, but maybe struggling, company. I believe Mr. Johnson’s previous experiences will work against him. Over the years, a very large percentage of venture capitalist organizations’ first task is replacing the startup CEO/entrepreneur with a seasoned successful enterprise CEO because of the differences in the required skill set. Wish him well, but it is going to be a big challenge.
I wish Ron Johnson all the best in his new venture. There is an evident gap in the technology market for not so savvy consumers. If this new venture fills that gap and makes technology a piece of cake for everyone, it’s sure to succeed. Johnson has to focus on what is current rather than being too ahead of his time.
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I think two things:
Still, it’s hard for me to understand what his goal is here, outside of eliminating single shingle and small businesses, who’ve been serving this market just fine for 20 years. So whether he learned or didn’t learn, I don’t see a viable business here.
The very best athletes recruited to help a team win a championship do not always work out. In team sports, it is not always about the skills of the premier player, it’s also about the chemistry of the team.
Ron Johnson’s talent and experience were not good chemistry at J.C. Penney.
The interesting aspect of this new venture is that does not appear to be store-based, at least in the traditional sense. It is a new concept, and that is where Ron Johnson’s talents may excel. Plus he is building his own team, not trying to turn around an aging franchise.
If there is ever an environment to unleash Johnson’s creativity, this one appears to be ideal. A great case study is about to unfold.
The fiasco at J.C. Penney overshadows not only his success at Apple, but his achievements at Target before that and probably the fact that he went to Stanford and Harvard Business School. That failure has come to symbolize his entire life, justifiably or not. Which is actually an opportunity to redeem himself in the court of business opinion. This idea looks interesting, although if it’s at all successful we can count on Amazon entering the business in force.
Well Johnson is right about one thing: It IS our job to rethink everything. I’m not sure how “Best Buy’s Geek Squad meets Apple’s Genius Bar” is evidence of a “rethinking.” Frankly that picture just makes me groan.
The biggest challenge for this type of venture is recruiting and retaining the caliber of talent that will not only understand the technical material but have the customer service skills to resonate with the customer. Mr. Johnson had the vision for J.C. Penney, he simply forgot to take the steps in front of him to get there. Know and respect your customers!
I can’t gather enough information about the new Ron Johnson venture to answer some of the following questions:
If I can suggest one thing to Mr. Johnson: Test first, jump in with both feet later.
Magic rarely overcomes madness. Ron Johnson now carries heavy baggage from his J.C. Penney’s adventure. While Mr. Johnson will use his experiences in his new venture, the problem is that the future is not what it used to be. Hopefully a smart guy like Ron will know how to bridge that gap.
Not everything he touched turned to stone at J.C. Penney, not everything he touched turned to gold at the Apple Store and I am sure he has learned from his mistakes like we all do. That being said, I personally don’t see the need for an upscale, on-demand high tech gadget delivery service. I wish him well and hope it succeeds, but this just isn’t something I would take advantage of.
Ron Johnson appears to be someone that thinks a little bit outside the box, however I’m not sure that he his visions can be seen well enough by consumers that feel warm and cuddly “inside” the box.
When I followed the Penney debacle last year, I wrote a blog post under the name of Gilon Miller, “11 Ways Ron Johnson Presaged His Own Disaster At J.C. Penney (But Nobody Noticed.“
Many wrote (and I agreed) that Ron Johnson failed at J.C. Penney because:
The key is, J.C. Penney wasn’t Apple, and Apple wasn’t J.C. Penney. Mr. Johnson seems more of a dreamer than a realist. Maybe Apple was his one-trick pony, and we can wonder if he’ll do his homework this time.
And if this new business idea is a viable one? Did anyone see any statistics on the need/demand for such a service? How would he do any better or any differently than anyone else who’s already in that market?
That remains to be seen, eh?
Ron Johnson’s performance and accomplishments at J. C. Penney are anything but unsuccessful. They are reaping the results of them today as the hapless Mr. Ullman only had to stand by and allow the results that they were headed towards in the first place.
There is no doubt that J.C. Penney’s current performance is a result of the foundation he began in creating a store that was different from the 1970s, current and more easily shopped, with product that consumers wanted to buy. Or, product that they could at least see to buy.
The only thing that has changed is the slow return from “JCP” to J.C. Penney, from a branding standpoint. Their current gains would likely have been even greater had they left that alone as well.
Even Mr. Johnson had re-introduced promotional efforts in a balanced way to allow the customer to determine value. That, instead of previously drowning the customer in so many promotions they were unable to realistically determine value. And the retailer was sinking in margin losses as they couldn’t determine value any better than the customer.
I’m quite sure that Mr. Johnson will be quite successful in his endeavor. J.C. Penney is far better off from him having been there.
All one has to do is check the headlines to ask the question: Is Apple really better off without him as well?
I was a fan of Mr. Johnson’s all the way to the end at J.C. Penney. Why? Because JCP needed a shot in the arm and Ron had all the makings. Still does!
What went wrong? His execution was poor and he didn’t think the old brand needed to factor into the new concept. Did that make his concept any less impressive? No! I thought what he was headed for at J.C. Penney was cool and spot-on for maybe a brand new concept with no baggage.
With that said, can he succeed in spite of the JCP debacle? Sure! Will he this time? Don’t know enough about the concept or the team to say if he can pull it off. But know for sure, he does have a great creative mind! And that, my friends, is my two cents!
If Ron Johnson’s tumultuous time at J.C. Penney didn’t eclipse his previous accomplishments, his post-Penney take on the experience did. While I actually applauded many of the initiatives he spearheaded at “JCP,” his hindsight portrayal of himself as a reluctant visitor thwarted by a hidebound culture, and his zeal in recounting multiple attempts at making an exit left a bad taste. Not exactly magnanimous. Not exactly someone you would recruit to author your turnaround story. Now, he’s taking the lead at a niche venture playing in a space that is growing more crowded by the minute, specializing in a category that is still finding its sea legs. Hubris hangover or genius market grab?
There is no doubt that Ron Johnson has a retail vision that is not only futuristic, it is also largely surrealistic. The fact that he has found money for this business plan is a good sign for an improvement in available disposable funds in the economy. The bad news is people will still throw away high-risk investment money by putting their faith in impossible dreams.
I’m excited to see what Mr. Johnson’s start-up offers and, as my interests are in the retail and technology sectors, I am curious to learn more about his new business concept of “gadget delivery, customer service and troubleshooting.”
Also curious to learn whether he is exploring commercial drones for this upscale, on-demand delivery service for high tech gadgets.
Amazon and Google are testing drone delivery systems and, once the FAA sets rules for “autonomous flights without pilots,” which may be by the end of this year, I’m betting commercial drone deliveries will become the upscale on-demand service. How do you compete with that?
Context is important when assessing one’s trajectory, and nothing goes up forever. Mr Johnson’s success at Apple was not replicated at J.C. Penney — different companies, cultures, and histories. Skills in a relative “startup” with Apple’s retail brand are not applicable in transforming an established and aging strategy.
Mr Johnson’s venture is a startup so that is a plus for him, yet the high touch approach and expected flawless execution may jeopardize success. It’s one thing to control all elements of a customer experience in an Apple Store versus working with frustrated consumers trying to enjoy their gadgets. This is a low margin, high detail, immediate gratification business.
Would I invest in this venture? Only with throwaway money and watch for the fast follower to get it right.
Well, I may stand alone on this, but I think it’s brilliant. Let’s face it, Geek Squad was one of the smartest things Best Buy ever did. (I don’t even need to mention Apple’s GB.) In the on-line age, a customer doesn’t have to go to stores any more. The expectation is that someone will bring whatever they bought to their house directly. So, to do that, then hook it up, no matter how complex … was/is advanced thinking.
Sooner or later, a tipping point is going to occur — if it hasn’t already — in that consumers will realize that the burden of fulfilling an order is no longer on them; no car, no parking lot, no searching shelves or prices, no installation. That burden is now on the retailer. Bring it to me. Do it for me.
Sounds like RJ’s experience with an advanced retailer and a dinosaur has taught him that the tsunami of “do it for me” is right at our doorstep. It will work, IMO.
No. His record at Apple was carefully crafted, and succeeded because of a strong brand which wouldn’t allow failure if the stores were poorly run. His ability to manage difficult retail situations was reflected at JCP. This venture sounds like it will go the same way.
Startups, like restaurants, have a high fall out rate, no matter who leads them. It will be interesting to watch, but I have my doubts about the viability of this one.
Understanding the consumer and the size of a market are fundamental. I think RJ didn’t understand the JCP consumer well enough to get that the changes would send them shopping elsewhere, and the “new JCP” consumer was going to take quite a while to show up. In the meantime, sales plummet.
Now for an equally viable new venture… How about a drone delivery pizza service — high touch, high taste, and avoiding traffic would make it possible to get even the thinnest crust home still piping hot.
It’s Friday….lighten up!
Good to see Mr Johnson back in the game!
I think his previous experience will only help him if he has a better mousetrap like the iPhone or iPad!
Hope RadioShack is watching closely.
It takes a totally different skill set to start a new venture then it does to run a successful, but maybe struggling, company. I believe Mr. Johnson’s previous experiences will work against him. Over the years, a very large percentage of venture capitalist organizations’ first task is replacing the startup CEO/entrepreneur with a seasoned successful enterprise CEO because of the differences in the required skill set. Wish him well, but it is going to be a big challenge.
I wish Ron Johnson all the best in his new venture. There is an evident gap in the technology market for not so savvy consumers. If this new venture fills that gap and makes technology a piece of cake for everyone, it’s sure to succeed. Johnson has to focus on what is current rather than being too ahead of his time.