Around 60 percent of customers said they feel guilty when they buy something they don't need, and they want to simplify their lives, JC Penney Chairman and CEO Mike Ullman told CNBC Tuesday.
Customers try to balance what they feel appropriate for their financial situation, Ullman added.(To hear the full interview, click here.)
"We see more cash at the register and more debit card use," he said.
But the period between back to school and holidays was the best time for JC Penney and the prospects for the department store chain were good, Ullman said.
"We're very positive about what we have to offer and we expect customers will respond well," he told "Squawk Box."
"Our customers really are middle-income customers primarily and they have saved in order to be able to do their shopping," Ullman said, but added that consumer credit has fallen overall.
Last week, JC Penney reported a 78 percent drop in its third-quarter earnings because of a big expense for its pension plan; its revenue slipped from a year earlier.
But the retailer upgraded its annual profit and sales outlook because it is selling more items at full price or on planned promotions.
"We believe anybody can slash their prices and do their business in the short term," but JC Penney is trying to balance its top line and bottom line, Ullman said.
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