JC Penney is dropping everything Martha Stewart because her items aren't selling well. However, Martha Stewart doesn't plan on ending the contract she holds with the department store.
According to USA Today, JC Penney's last CEO Ron Johnson signed a deal with Martha Stewart in 2011. Johnson was attempting to bring a ritzy feel to the store, but that failed when the products didn't sell. When he was fired in April, newly-hired Myron “Mike” Ullman began trying to save the struggling business. In his opinion, customers don't all want trendy merchandise, and they have been passing the Martha Stewart line right up.
"You are paying a premium that looks like the stuff in Target," said retail analyst and CEO of Belus Capital Advisors Brian Sozzi.
A legal battle began in 2011 between Macy's and JC Penney when Macy's, who already had a contract with the Stewart's Living Omnimedia company, sued JC Penney, reports ABC News. In order to sidestep the exclusive contract, JC Penny called their products JCP Everyday and sold additional items not sold in Macy's stores. However, Macy's continued to sue for damages. The lengthy court dispute was set to get a judge's ruling in just a few day to determine whether or not Macy's had exclusive rights to the products. JC Penney decided to drop the line, no matter what the ruling.
Replacing Stewart's line will be more basic items that will accommodate a wider range of consumers.
Image courtesy of Wikimedia Commons
