Read the JCP case (attached) and answer the following questions in 3 – 4 pages.
- What is the difference between high-low pricing and EDLP (or as JCP calls it ‘Fair and Square’ pricing)? In the case of JCP, did the change from high-low to EDLP result in approximately the same price for items. Validate your response.
- What were the issues surrounding JCP’s strategy in switching to EDLP? Identify all the issues outlined in the case.
- What long-term roles do coupons and discounts play for a retailer (other than offering short-term discounts to customers)?
- Ron Johnson’s strategy execution was considered as a failure. Did Ron Johnson do the right thing by starting off the new strategy with the pricing change or should he have implemented the pricing shift after making other changes? What are the pros and cons of starting with the new pricing strategy?
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