Penney Unwraps Ads for ‘Challenging’ Christmas

DALLAS JC Penney will rely on shorter TV spots for its holiday advertising and expects no increase in ad spending from last year, company executives said.

In unveiling the company’s holiday advertising this week, Penney executives said they expected sales to rise slightly despite the flat ad budget.

The high cost of energy could put a damper on a Christmas season that Ken Hicks, president and chief operating officer of stores, described as “competitive and challenging.”

Penney will open its holiday efforts with 15-second spots for gift cards and will use 30-second spots for more general ads, the company said.

The TV spots, created by Omnicom Group’s DDB, open with images of gold boxes wrapped with bows, followed by a series of gift ideas.

Penney will spend more of its advertising dollars during prime time on network and cable TV than on morning shows and will target programming that attracts a female audience, executives said. HGTV network and broadcast shows West Wing, ER and The Apprentice are among the programs Penney is favoring.

The retailer spent $337 million on advertising in 2003 and $198 million through September 2004, according to Nielsen Monitor-Plus.

Penney’s Hispanic ads are similar to those aimed at English-speaking audiences.

Based in the Dallas suburb of Plano, Texas, Penney expects the best sellers to be gift cards, home furnishings, jewelry and “affordable luxury,” such as a $99 tuxedo. Hicks said the company shipped holiday merchandise to stores earlier this year and expects to mark down slow-moving items more quickly.

Hicks has taken over operation of store, Internet and catalog operations after the departure of Vanessa Castagna, chairman and CEO of those units. Penney did not renew Castagna’s contract when it expired Nov. 14. She joined Penney in 1999.

Hicks, a member of the company’s executive committee, joined JC Penney in 2002 from Payless Shoe Source, where he was president. He has also held key management, merchandising and operational roles at Home Shopping Network, Foley’s Department Stores and May Merchandising Co.