Saving Sears & Kmart

Reading this article about how poorly Sears and Kmart have been treated by the current management regime makes me sad. It clearly shows thinking purely on accountancy, which terrible in a market where you really need to think about experiences to make money. There is a lot of talk about if these stores can even be saved, I think they can – if they hurry.

I think the issue of how to save these two stores lies in positioning. Both stores seem to misunderstand who they should be competing against and what they are really all about. While some think that their days are numbered, I think both have the necessary amount of equity left over to right themselves and become more competitive than they have in the recent decades.

When thinking of how to position these stores, I think the best thing to do is to look at them as closely related. This relationship places Kmart as the stepping stone store to Sears. I’ll get to that in a minute, but first let’s take them one by one.

Separately, Sears should best be positioned to challenge Kohls. Both Kohls and Sears serve, by and large, the same sort of no-nonsense middle America clientele. Currently, Sears has an advantage as it offers a more full-line experience, going beyond Kohls’ clothing and shallow housewares offerings and into appliances and other home goods. Of course Sears has also got to bring it in their softlines. They need to get back to the quality and timliness that Kohls has before they can really start to get a taste of the Kohls market. The components are there, they just need a bit of tweaking.

Kmart is a bit tricker in terms of market positioning. The best solution is to move somewhere in between Target and Wal*Mart. This means Big K has to bring up it’s quality, especially in apparel. They should also move away from trendy articles and focus on quality basics. It’s a hard sell to get people to think of Kmart as stylish but it’s  easier to think of them as quality. The added benefit to this is that there is money savings in not having to change over trendy stock as much.

The crucial part of the Kmart plan is that it becomes the entry point into the higher quality Sears stores and it has to be seen as such. To bring this to fruition, there has to be a lot of cross pollenation between stores. For instance, the Sears stores would carry, say a Martha Stewart line while Kmart would carry a Martha Stewart Basics line with clear allusion to a connection. This creates a link to better quality items and drives such a connection to Kmart while also creating a gateway for an eventual movement towards the higher-end Sears stores. There are bits of this happening, such as the stocking of time-tested Sears brands in Kmart, such as Craftsman and Kenmore, but I don’t think that the current plan is well thought out for both stores.

There are other things that both stores should pursue to help their cause. Kmart should focus on having more and better customer interaction on it’s sales floor – something that Walmart doesn’t offer. An extra smile and some extra help can go an awfully long way. Customer experience is paramount – even down to the checkout experience, ask anyone who’s spent time at the Best Buy cash register.

From a branding standpoint, I think the stores should also work to connect themselves. They should own the color blue. The interior should be brimming with it. The credit cards should have it as well as all the signage. People should know instinctively that they are in a Sears/Kmart store.

Finally, both stores need to have thier in-store images updated. It really needs to happen. Both are seriously dated and without a really grand bit of effort, both will have a hard time bringing back those customers that they had lost over the last 10-15 years. Kmarts can be outwardly dingy at some locations to nearly comically outdated at others. They’ll have to spend money to update and incremental minor changes are not going to do it.

Both Sears and Kmart have a lot to do, but fortunately for them, it’s do-able and would actually make some profits – far more than mortaging your subrand equity by smearing your prized private label brands in any store you can.


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