|How is Sears relating to changing customer needs and
what changes will we be seeing in stores?|
The customer is
increasingly starved for time. She doesn't like to shop, and when she
does, she wants a more fun-filled, efficient, impactful shopping
experience. That's why we're editing our assortments so that when she
comes into the store, she quickly finds merchandise that stands for
In ready-to-wear, for instance, there will be more outfits presented in
a way that enables the customer to see the products as she'd like to wear
them. "Exciting," "new," "idea-driven" and "focused" are words that
describe our approach to the ready-to-wear business.
We're editing hardgoods selections as well, and redesigning some of
those businesses. Take sporting goods. We're exiting certain team sports
items and concentrating on exercise and camping equipment. Further, it
will be scaled down to provide space and opportunities for new businesses
to be part of our mix.
Across all our businesses,
we'll be a lot more aggressive in presenting relevant new products to our
target customer. We are going to be just as aggressive in providing the
best value to our customer. This means selling our merchandise at the
right price, which our customer easily understands.
We'll run a business that is driven by both private and national
brands. For example, Vanity Fair, Trifari and Maytag all were introduced
last year. The addition of these major brands to our selection - brands
that our customers trust and respect - is an important part of our
What is merchandising's role in making Sears a fun place to
Merchandising is at the heart of what we do. The customer
describes fun as finding a great price on merchandise she can buy quickly
so she can get on with the rest of her day. It's all about
interesting-looking merchandise that the customer finds, buys and takes
out of the store, leaving happy and satisfied.
Especially in apparel, we've got to make it easy for her to see the
merchandise and visualize herself in the outfit, as well as offer it at
the right price. The winners in this business are going to be retailers
that really understand what drives customer behavior: How often does she
shop? What drives her perception of value? What is she looking for?
What avenues do you have to understand the customer?
the largest consumer information database of any retailer in the country.
This customer information allows us to get a better handle on when and how
our customers shop and the kinds of things they need and want. It also
allows us to understand cross-shopping behavior, an important generator of
What are your plans for serving the urban market?
emboldened by the productivity we're experiencing in New York City, Los
Angeles, San Juan, Chicago and Boston. The great cities in our country are
experiencing a renaissance - and where people are establishing households
and revitalizing neighborhoods, we're enjoying success. We think these
markets are being rediscovered by retailers - but, generally, these good
customers have been underserved. We want to be aggressive in serving these
Are you opening smaller stores?
We have opened approximately
10 small-market prototypes averaging about 60,000 selling square feet in
smaller malls and strip centers. We like our first year results, but will
continue to adjust our assortments and marketing. On balance, we think we
have it more right than wrong. We'll evaluate our work in about six months
and define our small-market store strategy at that time.
What are your 1999 plans for marketing?
objective, of course, is to drive sales every day through each and every
marketing program we do. The issue is how best to communicate Sears value
messages to our customer. We need to take the successes and failures of
the recent past and act upon them to begin improving our performance right
A major objective in our short-term plan is to improve our weekly
pre-prints - the advertising supplements inserted into newspapers reaching
60 million homes each week. It is an important weekly sales driver and the
biggest, most visible and most comprehensive presence we have in the
customer's view. Though there certainly are other ways we reach customers
via direct mail, television, radio and the Internet - the fact is that the
pre-print is the main channel.
We will continue to focus on promotional events, because recognizable
value is important to our customers. Increasingly, we must tell a
whole-store story about our promotions.
Is Sears current marketing program still relevant?
billion-plus marketing program is significant and provides an enormous
competitive advantage. Our overall strategy of celebrating the "many sides
of Sears," while creating a focus on apparel as a counterpoint to our
hardgoods businesses, has worked very well. It's been extraordinarily well
received and very productive up until recently. Right now, we are in an
extraordinarily competitive arena, where change is the only constant, and
our marketing program has to keep pace. So we are reviewing everything to
make sure we remain focused on driving sales growth.
Is Sears still on target with its core customer? Is she still the
woman of the American household?
Our core customer remains the
middle-income female, age 25 to 54 and head of her household. But we're
disappointed with the level of business she's doing with us. We need to
reenergize our efforts to appeal to her as a relevant retail resource
while also becoming more relevant to a younger, but often less loyal,
customer within our target. At the same time, we have to meet the needs of
the Baby Boomers, who are requiring more services - such as home services
- as they mature.
How do you make Sears a more compelling place to work?
must create an environment where our associates say "I must do something"
rather than "something must be done." Then we have a company where people
are truly unshackled, balanced by our historic cultural characteristics
such as pride, integrity, work ethic, dedication and compassion. If our
people grow every day and are fairly compensated with pay and benefits for
the contributions they make to our customers, we'll make progress on being
a compelling place to work.
Research shows that training and development programs can be key
drivers of associate satisfaction and business performance.
How does Sears differentiate itself in these areas?
University continues to be our primary vehicle for delivering executive
and management development programs, as well as learning opportunities for
all Sears associates. It has achieved national and international
distinction for its work. In 1998, more than 15,000 managers participated
in Sears University courses and more than 150,000 associates took
advantage of our correspondence courses, audio and video cassette library
and online learning opportunities. Training and education have focused
heavily on ways to create customer satisfaction, on business and financial
literacy, and on diversity learning methodology, including digital
satellite and intranet-based programs, to create an anytime, anywhere