Ron Johnson Is At Odds With The Philosophy Of JCPenney's Founder

Ron Johnson's turnaround strategy for JCPenney was largely centered on "fair and square" pricing.

This included weaning people off promotions and claiming to offer the lowest prices every day.

The company's marketing even compared JCPenney's prices to competitors and boasted that its were lower. While the retailer has backtracked and started offering promotions again, the "low price" philosophy is still prevalent.

Johnson is running out of time to execute his strategy, which has been a failure so far. Same-store sales are down 32 percent, and the company is burning through what cash it has.

Looking at JCPenney's history, it's not surprising that the new strategy isn't connecting with consumers.

The company's founder, James Cash Penney, had a totally different philosophy on what made a great brand: great customer service.

“The public is not greatly interested in saving a little money on a purchase at the expense of service,” Penney once said.

A big part of JCPenney's turnaround strategy is to cut costs, but it's affecting the service in the stores, according to JCPenney associates who we've spoken with.

"I cringe each time I say 'how can I help you?'" an associate told us, "because I feel the chances I actually can have diminished so."

Investing in customer service over lower prices is what made JCPenney great, consumer expert and bestselling author Grant Cardone told us.

"Price does not create loyalty, it is the experience exchanged with the customer that exceeds their expectations that binds the customer to a company," Cardone said.

Meanwhile, Johnson's thinking is that having the lowest prices every day will get people into the stores.

And while Johnson's JCPenney has ramped up its edgy marketing, Penney believed that good service was the only advertisement he needed.

"Courteous treatment will make the customer a walking advertisement," Penney once said.

Perhaps Johnson should go back to the company's roots.