J.C. Penney is taking its head-to-head battle with Sears one stop further.
Roughly one year after making its return to the appliance category, Penney’s will begin testing a series of home installation initiatives that include heating, ventilation and air conditioning (HVAC). Meanwhile, it will expand its appliance showrooms to another 100 locations, up from its current 500. It will also add new brands to the mix.
“We share over 400 malls with a struggling retailer that was once dominant in this category,” CEO Marvin Ellison said, on an earnings conference call Friday.
According to the latest estimate from TWICE and The Stevenson Co., Sears forfeited roughly $1 billion in major appliance sales in 2015. It recently licensed its Kenmore brand to grill maker Permasteel for an undisclosed amount. And last month, Sears’ home services division rolled out a smartphone technology that allows technicians to remotely consult with their superiors to fix problems faster.
Sears technicians make nearly 7 million service calls annually, the company says.
Ellison noted that home installation was a logical next step for J.C. Penney, given that 70 percent of its customer base is female. Roughly 70 percent of its shoppers are homeowners.
For J.C. Penney, growing its appliance business is one way the retailer plans to decrease its dependence on the struggling apparel category and increase its share in a growing market. Shoppers have been spending more on their homes thanks to rising values. Appliances also help drive Penney’s productivity higher.
Penney’s home category was a bright spot during its fiscal fourth quarter, generating a positive comparable sales result. That compares with its overall 0.7 percent decline in that metric.
