What Retail Legend Ron Johnson Learned from Apple’s Success and JCPenney’s Failure

Ron Johnson joined Apple after 15 years in retail, including his work making Target a design-forward retailer. In 2000, technology retail was largely run by people who understood technology but not retail, so Johnson and Steve Jobs had to design the Apple Store experience from scratch. They identified the customer not as the existing computer enthusiast, but as the millions of people who had not yet joined the computer revolution. As the world moved from analog to digital, they believed the Mac’s ease of use could attract technology novices. Their decisions went against conventional retail logic. Computers were bought only once every four or five years, so standard wisdom said to put stores in inexpensive locations rather than high-traffic malls. Johnson and Jobs believed people would not drive 10 miles just to investigate a Mac, but might walk 10 feet out of their way while already shopping. They also hired people from bookstores—people who loved working with other people—and taught them technology, rather than hiring technology specialists on commission. The stores were roughly 6,000 square feet, about the size of a Gap, because Jobs said Apple’s brand was “bigger” than the Gap’s. The objective was to get people into the store, let them use a Mac, and connect them with a friendly, knowledgeable employee.

Johnson said the Apple Store was built in an era with much less readily available data: at Target, sales reports came weekly, and finding out what had sold the previous day required unusual effort. Jobs was not interested in relying primarily on focus groups or historical data; he believed in imagining something that had never been done, doing what seemed right, and letting people understand it when they saw it. Johnson therefore had to trust his and Jobs’s instincts about mall locations, large stores, noncommissioned employees, and a novice-focused experience. He does not interpret this as permission to ignore evidence after launch. Leaders have to “read the results of what you did” and determine whether the idea is working. But Johnson warned that data mainly describes what has already happened, while innovation requires imagination. He argued that this is even more relevant in an AI era, when common knowledge and previously learned strategies are available through a query. If he asked ChatGPT for a 10-part plan to build Apple Stores, he said, it would not have recommended the choices Apple made in 2000. The distinctive contribution people bring is their inner voice, formed by personal experience. In Apple’s case, the team made several bets to solve the practical problem of generating traffic and repeat visits; once customers entered, handled the products, and spoke with employees, the business began to work.

Johnson described Jobs as someone who was never in a hurry despite accomplishing a great deal. Jobs worked on one major thing at a time: Pixar was allowed to make only one movie a year because it could make one great movie a year; Apple had four products when the stores launched, then spent more than a year developing the iPod and waited six years before introducing its next major consumer product, the iPhone. Jobs believed Apple had to earn the right to introduce another product by making the previous one successful. Jobs also worked closely with a small group of trusted people, was available to his inner circle, and cared about painstaking detail. When Apple’s stores were nearly ready, he decided they were not right and delayed them six months. He was willing to pursue things that had never been done and patiently will them to success rather than abandon a strategy quickly. Johnson said Jobs was especially good at asking questions and allowing a vision to emerge through conversations rather than simply announcing a plan. Jobs told Johnson to hire “interesting people” because they were curious and would bring new ideas. Johnson and Jobs themselves represented contrasting perspectives: Johnson came from an analog retail world, while Jobs was creating digital technology. That difference helped them design for both the customer Apple already had and the customer it hoped to reach.

Johnson said retail employees should think of themselves as building relationships one customer at a time. A first-time visitor represents the start of a relationship; a returning customer deepens it; and a customer with a problem gives the company a chance to restore it. Apple employees were trained to offer a warm welcome, ask what brought someone into the store, answer the person’s question, and welcome them back. Johnson told employees not to focus on what they sold each day, but on the quality of the experience, because sales would follow. He emphasized that good service is more than training people to be pleasant. Each customer has a different reason for buying or upgrading, so employees must discover that need and personalize the solution. When an employee is with a customer, that employee is “the leader of that relationship” and needs the authority and confidence to decide how to create a great experience. Johnson also described the store as a continual source of innovation. A customer once said they might learn to use a product but did not know how to start, so an employee offered to set it up in the store. What initially took an hour became standard practice: eventually every iPad, iPhone, and Mac was set up before the customer left. Johnson said this insight came from real interactions, not a focus group; companies with strong communication between frontline employees and headquarters can effectively run a customer-learning system every day.

Asked whether public-facing stores remain important in 2026, Johnson rejected the idea that retail stores are dying. He pointed to Simon, the largest U.S. mall operator, which he said had 96% occupancy, its highest rents and sales per square foot ever, and was busier than before. He also cited the Stanford Shopping Center, where he lives, as a place where parking is extremely difficult because people continue to visit stores. His broader figure was that 85% of worldwide retail revenue comes from a physical store or the store’s omni-channel online strategy. Johnson used Walmart and Amazon to illustrate the point. Although Amazon was expected to compete strongly with Walmart because both offer broad assortments at low prices, Walmart’s stock and market capitalization were each eight times higher than in 2000, when the dot-com boom led many to predict the disappearance of stores. Johnson’s conclusion was that Walmart had a stronger model because it combined stores and online commerce. Amazon had to build toward omni-channel retail and, he said, has struggled to make money from retail itself, relying heavily on advertising on its site. He noted that Amazon has repeatedly experimented with physical retail and was building a superstore outside Chicago. Brands such as Skims and luxury retailer Zegna also show the value of physical relationships: Zegna gets 97% of its volume through stores, while more than half comes from digital contacts initiated through relationships between store employees and customers.

After 12 years at Apple, Johnson became CEO of JCPenney to transform the department store. He acknowledged plainly that the effort failed “massively.” At Apple, he had spent 18 months as the only employee, built a team that shared the vision, and then launched. At JCPenney, he assumed the company wanted the transformation he proposed, but many employees believed they had survived by serving lower-income and middle-American customers better than their competitors. They did not feel an urgent need to change, and Johnson became “the transformation they didn’t want to have.” Johnson moved too quickly and kept the entire existing leadership team, while adding some people he knew to open positions. His friend Safra Catz of Oracle later told him that Oracle kept no leaders from acquired companies because one respected passive-aggressive leader could derail a transformation. Johnson said he did not know whether that rule was universally correct, but realized he should first have determined whether the team was capable of leading the change. He also misread the effect of ending JCPenney’s promotion-heavy model. He expected sales to decline 15%; they fell 20%. Johnson believed the 5% miss was manageable, and said customers who remained loved the cleaner stores, improved presentation, and experience, with net promoter scores “through the roof.” But the board, investors, employees, and customers did not understand why the company would seemingly give up 20% of its customer base to pursue younger families. Johnson concluded that he had been “situationally arrogant,” after 25 years of uninterrupted success, and that he needed more humility and better coaching.

For a first-time CEO leading a transformation, Johnson now recommends taking six months to a year to understand the organization before launching major changes. Leaders should meet people throughout the company, ask what the problems are and what would help the business win, listen to customers, and determine whether the retained team genuinely supports the change. His formulation was that leaders must “go slow to go fast”: knowing the destination and assembling the right team prevents a transformation from starting in the wrong direction. Johnson contrasted JCPenney with Apple through the numbers. Apple’s sales fell 38% in 2002 and its stock traded at cash value, but the team understood why major changes to the processor roadmap and operating system were necessary. At JCPenney, he understood the strategic reason for accepting an initial sales decline, but failed to bring the stakeholders along. He now defines humility as listening rather than presenting his own ideas—asking questions, hearing dissent, and making room for perspectives unlike his own. He also connected this lesson to his belief in kindness. He grew up with “Minnesota nice” and sees kindness as a choice to help people become their best selves. In business, that means having someone’s back, encouraging them, and interacting in a way that lifts their spirits and self-esteem. For Johnson, meaningful work is work that improves people’s lives, whether through accessible design at Target, easier children’s clothing sizing, or free help and training in Apple Stores.