Sears and Kmart Brand Merger

Opinions on the Sears and Kmart Brand Merger

The real issues facing Sears and Kmart in their new roles as retail partners revolve around brand… from RETAIL MERCHANDISER

Sears and KmartThe real issues facing Sears and Kmart in their new roles as retail partners revolve around brand, and not so much around the value of their real estate.

Under old brand models that measure equity and value, such as Business Week’s “Top 100,” the two partners have equity, says Tom Dougherty, managing partner and senior strategist at Stealing Share, a brand development and strategy firm in Greensboro, NC. But he believes this “old school” thinking that confuses corporate identity with brand meaning is an obstacle.

Sears and Kmart“Sears and Kmart do not suffer from lack of awareness or from lack of physical locations,” adds Dougherty. “What they lack is ‘mind location,’ and I fear that they either do not recognize or fail to acknowledge this deficit. Sears occupies a position in the consumer’s mind as a ‘mall of brands,’ and Kmart is simply location driven.” Dougherty believes this subject is not being addressed by the retailers or by the industry at large.

Rather, talk centers on physical store locations and the consolidation and fat trimming the new management team plans to pursue. “There has been nothing said about the real problem, and that problem is brand–and the fact is the Sears and Kmart brands are nonexistent to the consumer.

When the retail market today evaluates their space, they see it divided by discount retailers like Wal-Mart, Target and Kmart, and traditional retailers such as Macy’s and Sears and the like. In other words, retailers view their market space and brand meaning as a reflection of who they are as retailers and not who the consumer believes they are as customers.

What really matters is the brand face, which is a reflection of who the consumer believes they are when they use a particular product or service. Certainly, the corporate identity for Wal-Mart and Target is built around ‘best prices, ‘ but customers shop at Wal-Mart and Target for very different and telling reasons.”

Sears and KmartDougherty believes Wal-Mart and Target provide consumers with appealing shopping destinations and can exist independently and out of the mall setting. Caravans of shoppers bursting at the seams with cash and credit will make their way to these super centers. “Both retailers occupy a first and foremost place in the belief system of the customer resulting in brand awareness, connection and success.”

Sears and Kmart, on the other hand, lack this brand relevance. They occupy a physical location, but the customer is hard pressed to place them anywhere in their minds or belief systems. Kmart never owned a brand. Rather, it has traditionally emphasized cheap prices, which indicated poor quality, said Dougherty. Sears has historically been a stable of brands.

In many ways, Sears has traditionally been its own mall. Consumers would go to this “mall” to buy an appliance (Kenmore) or a tool (Craftsman). “Maybe while you were there, you bought from the ‘softer side of Sears,’ too. Unless you had specific goods in mind, Sears did not enter the considered set.” Without a new and robust brand, Dougherty believes Sears and Kmart will flounder, regardless of how many locations they cull or consolidate. “You cannot save your way to wealth.

Sears and KmartIt is time to become alert to the fact that the Sears and/or Kmart brand, as it is presently defined, does not work. The old ‘brand arts’ only worked 40 years ago because the market was uncrowded and USP (unique selling proposition) was in fact selling. The market confused a marketing tactic with brand equity and mistakenly defined the brand by its own corporate identities. In fact, brand has never been about the company, product or service; brand has always been about the customer it influences.

The brand belongs to the customer because it is purely about the customer, reflecting their beliefs and identity.” Dougherty believes the solution for Sears/Kmart would be to challenge everything they have done in the past and present to create a brand that causes the customer to covet it as a powerful beacon of self-expression. “New management needs to commit to forming a new brand that the customer needs and literally feels incomplete unless they have it. When the customer thinks of the new brand, they need to affirm emphatically that ‘yes, I need to be that.’ Only then will the marriage work.” –-Debby Garbato, Retail Merchandiser

Leave a Reply

Your email address will not be published. Required fields are marked *