Renowned for running some of the nation's biggest department stores, Allen Questrom is concerned by what he sees happening at JCPenney .
Although he's currently a senior advisor at Lee Equity Partners, Questrom once occupied the corner office at Penney's.
And in a live interview on CNBC's Fast Money Halftime Report, Questrom tells us he’s shocked by the changes he’s seeing at his former company.
“Clearly the first part of Johnson’s strategy - elimination of coupons and sales - was a failure,” he says.
And Questrom isn’t just saying that because under his tenure Penney’s held sales, he saying it because he feels Penney’s customers want sales.
“Johnson may believe in the everyday low price strategy but the customer doesn’t. It goes against the grain.”
Questrom also tells us the jury is still out on the second part of the strategy – re-doing all the stores.
Under Johnson, JC Penney is dramatically changing its selection of brands and the store experience. As of Aug. 1, the chain began installing shops for Levi's and its Arizona brand. The goal is to eventually install 100 shops inside the stores that will replace the sea of mixed clothing racks typical of department stores. It also plans spots in its stores called Town Squares, similar to Apple's Genius Bars, which will offer services and advice.
“But what really surprises me is that they’re not really testing it. It doesn’t feel like they’re listening to the customer,” says Questrom.
Posted by CNBC's Lee Brodie
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Trader disclosure: On August 17, 2012, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Jon Najarian is long AAPL CALL SPREADS; Jon Najarian is long CPN CALL SPREADS; Jon Najarian is long CSCO CALL SPREADS; Jon Najarian is long GLD CALL SPREADS; Jon Najarian is long NLFX CALL SPREADS; Jon Najarian is long NRG CALL SPREADS; Jon Najarian is long STLD CALL SPREADS; Jon Najarian is long YHOO CALL SPREADS; Jon Najarian is long VIX CALL SPREADS; Jon Najarian is long STSI; Jon Najarian is long CBOE; Jon Najarian is long CME; Jon Najarian is long GLUU; Pete Najarian is long AAPL CALLS; Pete Najarian is long AAPL; Pete Najarian is long C; Pete Najarian is long INTC; Pete Najarian is long SBUX; Pete Najarian is long FB; Pete Najarian is long MSFT; Steven Weiss is long DE; Steven Weiss is long TCK; Steven Weiss is long AAPL; Steven Weiss is long QCOM; Steven Weiss is long HAIN; Steven Weiss is long HK; Steven Weiss is long TBT; Josh Brown is long AAPL; Josh Brown is long WFC; Josh Brown is long GDX; Josh Brown is long GLD; Josh Brown is long XLU; Josh Brown is long WMT; Josh Brown is long TGT; Josh Brown is long SBUX; Josh Brown is long GPS
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