Monday, July 29, 2013


Sears Holding Corporation – the multinational formed by the 2005 marriage of Sears and Kmart – continues to prove itself unworthy to investors and shoppers alike.

The company’s stock price has dropped to just below $43 a share after having peaked at nearly $67 in November. Since 2005, SHC’s earnings have fallen from $49.1 billion to $39.9 billion – a 19% drop that was entirely unexpected because the Great Recession should have driven cost-conscious shoppers to Kmart in droves. In comparison, Wal-Mart’s revenues increased by a whopping 42% over that same period.

Things have been so bad that 2011’s abysmal holiday sales called for closure of 120 stores last year. For that season, Kmart saw its sales drop by 4.4%, Sears by 6%. In stark contrast to that performance, the rest of the retail industry actually saw their Christmas sales rise by 5.6%.   

So, why can’t SHC, a conglomerate possessed of two once-beloved chains, hang with the Wal-Marts, Targets, and Home Depots of the world?

The answer: Look no further than Jaclyn Smith.

Last week while shopping at the Wellsville Kmart I was startled to see that the face and name of the one-time Charlie’s Angels star were gracing the home products and apparel aisles. Nothing against the ageless beauty, but her ship sailed long ago. Her peak of celebrity was in the late 1970s and her fame has been spotty at best in the past 3 decades.

It’s awfully odd that an array of supposed advertising geniuses led by Chariman/CEO Edward Lampbert -- who has a net worth of more than $3 billion and should know better -- would build a major marketing campaign around someone who carries no meaning to anyone under the age of 45.

Sure, Baby Boomers and the oldest of Generation X (who all once fawned over Smith) may represent a large portion of Kmart shoppers, but young families and the prized 18 to 35 demographic -- who represent the economy’s biggest and most-desired spenders -- have no idea who she is. So, why would they feel compelled to buy anything that she endorses within the store? Any mass merchandiser that misses that crucial target audience – especially as badly as this -- can count itself dead in the water. 

The Jaclyn Smith campaign makes it patently obvious that what has often been said about Kmart is true: It’s living in the past.

For further proof, just take a walk around any of their stores. There is little fresh about them. Unlike Target and Wal-Mart properties, they are tired and beaten.

Their workers are feeling the same way.

Just 2 weeks ago Sears Holding ended up in seventh place on 24/7 Wall Street’s list of America’s worst companies to work for. If the workforce is that disgruntled, there’s no way that superior service can be offered when most workers are on the front-lines and end up suffering the consequences of corporate management’s poor merchandising and facilities decisions.

It’s really unfortunate to see one of America’s longest-lived department stores (Sears turns 120 this year) and what was one of its most-respected discount stores (Kmart was Target before Target) take hit after hit and wither away under such poor leadership. It’s no wonder they are driving buyers (of both stocks and merchandise) away.            

For a moment, though, forget about our woes as shoppers and investors. SHC’s experiments in foolhardy marketing endeavors are a dangerous game to be playing when 274,000 workers are counting on a SHC paycheck.  You can’t help but worry about their future and wonder if very soon their employer might go the way of Montgomery Ward or Ames.

Gasport resident Bob Confer also writes for the
New American at Follow him on Twitter @bobconfer.

This column originally appeared in the 05 August 2013 Greater Niagara Newspapers

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