In 1888, “The R.W. Sears Watch Co.” used a printed mailer to advertise watches and jewelry. Direct mail was born. A few years later in 1894, Richard Sears himself illustrated the cover of the very first Sears, Roebuck and Co. catalog, which he declared the “Book of Bargains: A Money Saver for Everyone.” (via History of the Sears Catalog) This was a time in America when the railroad system was growing, people were moving west and the promise of striking gold was real. The hope of prosperity combined with the newly established Rural Free Delivery made it the right time and place for the beginning of the retail industry in the US and the birth of one of this country’s most iconic brands.
Fast-forward to today and it’s heart-breaking to see Sears fallen on such hard times. From the news of its ninth consecutive quarterly loss this summer to the desperate infusion of cash from Eddie Lampert’s hedge fund to selling off stores and laying off employees to generate cash – it seems the company is only surviving because of some fancy financial footwork.
As we enter into the Insight Economy, the landscape has become extremely complex, especially in the highly-competitive retail arena. A number of retailers are struggling to maintain their business. So, Sears is not alone in missing the key elements they need to survive, but I would say they are more than a few steps behind even their struggling peers.
I believe that it is time for Sears to catch up and become relevant again. But, how?
I have some suggestions that might help. These are based on some of the fundamental rules that govern this new Insight Economy. These rules are pragmatic and common-sensical. They have been tested by time and cynical detractors. They may seem obvious, but the simplest answers normally are. I hope they are useful to Mr. Lampert and the Associates at Sears. Here goes:
Focus on your core customers, first. Don’t market to people who aren’t your customers and never will be.
This is the first rule of the Insight Economy. It is to maniacally focus on the “one that pays your bills”. In Sears’ case, you should focus on the people who are shopping you today. They’re not the “I’ll buy all I need online” group. They are also not the customers that helped Sears become one of the most valuable brands in the world. Your customer today looks very different from ones even a decade ago. Definitely not the average American family popularized in the movies. You need to embrace these folks and deliver on their needs. So, invest in your stores and make them easier to shop. That’s what your customers want. A store where they can try the stuff before they buy it. A store where they can find new things. A store where they can return things they don’t really need or that don’t really work. A real store with real people to help them find stuff they need. Not an online or digital site alone.
Give your customers real reasons to shop your store. Make it their destination again.
What do your core customers expect from Sears? Does Sears really deliver on these expectations? Is the price-based promotional marketing going to convince them that Sears is the right choice for them? Is the Sears Your Way loyalty program the reason for them to prefer your brand over its competitors? The vote so far has been unequivocal. These approaches do not work. Go back to the basics. It is not very complicated. Good selection of good products at a good value in an easy to shop store with helpful associates. What Sears did really well for many decades. Commit to the basics again and see the brand prosper.
Stand for something. Meaningful.
What does Sears stand for today? In this world of 24/7 shopping and same-day delivery, the promise of “shop your way” is neither differentiating nor compelling. Find a proposition that is persuasive yet distinct from your competitive set. This will allow you to become relevant to your strategic value target and create compelling reasons to visit your stores.
Leverage your existing assets. Use what you have instead of trying to create something new.
The last time that Sears had consistently positive results was when the “softer side of Sears” campaign was created. I am by no means suggesting that another marketing campaign is the answer. But, the basis of the campaign was the insight that a lot of people were coming to Sears to buy Craftsman®, Kenmore® and DieHard® products. In full transparency, I have been and currently am an owner of a number Craftsman and Kenmore products. Customers (as do I) trust these brands because they have delivered and continue to deliver great performance over decades (if not generations). Why not use these brands to recreate Sears into a new world brand? Maybe, a brand that truly empowers the DIY’er? Could you use your Blue Crew to create a differentiated offering in this time-starved environment? Think differently and see if there are growth pathways in lateral spaces.
Bring in experts.
When Ron Johnson left JC Penney after his short tenure (less than two years), the Board brought back Myron Ullman (a retail professional), the prior CEO to fix the business. Despite the desperate circumstances, he has managed to breathe some life into the company. With Marvin Ellison (former EVP of Stores at The Home Depot) taking the reins as CEO-designee, the company continues to bring in retail operations experience to continue its turnaround. Sears needs to do the same. Bring in a retail professional as CEO. This business is tough and complicated. It is even more so in this hyper-complex and hyper-fast Insight Economy. Someone who knows how to win in this space should be running the business. Using an analogy… why do we think Michael Jordan gave up on baseball after a couple of frustrating seasons to come back to the Bulls (and win his sixth ring)? Being a basketball great doesn’t make you great in other sports.
I care about the future of Sears. For the Chicagoland area, which has been my home for almost 25 years, and for the legacy it represents. After being an integral part of the growth of this country and surviving the transformations over the past millennia, it would be a shame to see the Sears brand fade away.