The news earlier this month that Martha Stewart is taking her wares to J.C. Penney is worthy of a cover story for Star magazine.
Not surprisingly, tongues are wagging.
Home furnishings is all abuzz about Martha’s proposed ménage à trois: J.C. Penney has clearly wooed Martha successfully, yet she’s hoping to continue her relationship with longtime partner Macy’s. Will Macy’s play along? Or will CEO Terry Lundgren declare a divorce from the domestic doyenne because she’s headin’ for the cheatin’ side of town?
Immediately following the release of the news that Martha was hooking up with J.C. Penney, a source inside Martha Stewart Living Omnimedia emphatically told HFN that the deal “would not affect” her relationship with Macy’s. The next day, Macy’s—sounding very much like the jilted lover—released a statement that it had put its Martha merchandise under review “in light of the proliferation of Martha Stewart-branded product in the marketplace.”
Martha’s move comes at a very interesting time for all three of the parties involved. For J.C. Penney’s, the Martha addition is a clarion call that it’s a new day for the retailer under the leadership of Ron Johnson. The former head of Apple stores has his work cut out for him: For the most recent quarter, J.C. Penney reported declines in comp store sales, total sales and Internet sales.
Macy’s is in the midst of a revival of sorts, recently reporting consistently positive sales increases, including a nearly 40 percent jump in online sales for the year. The nation’s largest department store chain banks heavily on recognizable celebrities—including Martha Stewart—in its media campaigns. According to Martha Stewart Living Omnimedia, the Martha Stewart Collection is the top brand in the retailer’s home category, led by strong sales in textiles and tabletop. Martha wouldn’t be easy to replace, should Macy’s CEO Lundgren decide to call the whole thing off.
Meanwhile, Martha Stewart faces competition like never before. Likeable celebrity chefs Paula Deen and Rachael Ray have made serious inroads into licensing, exemplified by the recent introduction of tabletop collections for Meyer. Deen’s brand has extended successfully into the rug category. Deen’s popularity may even rub off onto her offspring—her sons Jamie and Bobby will appear at AmericasMart Atlanta this month during the International Gift & Home Furnishings Market.
Apparently designer Chris Madden didn’t see the J.C. Penney/Martha agreement coming. Madden, who has been affiliated with J.C. Penney for more than eight years, said she has sold more than $1.5 billion products at the chain.
Probably the most interesting aspect of the J.C. Penny/Martha deal is that the Martha Stewart items will be sold in Martha-branded shops within the stores. The Martha shops will be staffed by “design experts,” basically mirroring the strategy of the massively successful Apple stores. The idea of bringing personalized home design to J.C. Penney’s customers is intriguing, to say the least.
Just don’t make me call the design employees “geniuses.”