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[6 comments]

Kmart.com Ranked Last for Customer Satisfaction

June 2, 2005

By George Anderson

Larry Freed, president and CEO of ForeSee Results, an Internet services provider out of Ann Arbor, Mich., told the Chicago Sun-Times, "If shoppers are satisfied, they will buy more goods, recommend your company to others and be loyal over time. A typical consumer will research a purchase online and buy in-store or research a product in the store and buy online."

Of course, if they are not satisfied then conversely negative results are likely to occur.

A survey conducted by Mr. Freed's firm assessing customers' satisfaction with the prices, merchandise and Web site experience of 40 top-grossing retailers with online offerings saw Kmart.com ranked last with a score of 69.

A report issued by Forrester Research in March ranked Kmart.com first for site design.

Mr. Freed attributed Kmart's ranking in his company's study to customer dissatisfaction with the goods offered for sale.

Sears.com was viewed more favorably by consumers with a score of 74 that Mr. Freed characterized as "decent." The score given Sears included consumer grades given to the Lands' End site.

Moderator's Comment: What impact (positively or negatively) does a customer's experience with a Web site have on physical store performance and how does the store experience affect the online business? Which retailer has done the best job of integrating the online and offline experience? - George Anderson - Moderator

Discussion Questions:

While we value unfettered opinion, we urge you to show respect and courtesy for people or companies about whom you comment. Keep in mind that this is a public, professional business discussion. RetailWire reserves the right to edit or refuse the publication of remarks that we deem unsuitable. We may also correct for unintended spelling and grammatical errors.

Instant Poll:

Which has a greater negative or positive impact on the other?

Comments:

I'm not sure how the on-line experience affects the brick and mortar business. However, from my experience, the quality and ease of using a web site is often reflective of how well a business is run. Idiotic sites that have you going in circles are usually [an indication of] the way the brick and mortar side is run, especially those with lots of stupid graphics and sounds. If you can call ebay a retailer, then I think they have done a good job. Wal-Mart has also done a nice job. It's important to me to be able to quickly find and purchase what I want without a lot of extra mouse clicks taking me on a trip someplace I don't want to go.

David Livingston, Principal, DJL Research

This reply is based on one of the panel's comments on retailers having a brand manager. This post is not intended to bring derision to this site, but this post makes one simple point.

To me "brand manager" equates to chief merchandising officer. This is something Kmart does not have presently nor, for that matter, since bankruptcy. They [Kmart] are using the expertise of Guyardo as chief advertising officer [i.e. - the Kmart / Warner Brothers cross promoting each other last fall], and the merchandising creativity expertise of the likes of former executives Schultz from GAP, and Johnson from Carrefour.

But the gaping management problem: Kmart does not have an overseer of merchandise, like Warren Flick during the Floyd Hall era. Maybe the Sears merchandising guru from Target will inherit this responsibility?

A question immediately arises. How is the Kmart website to upgrade to midlevel performance like Sears when the former Sears CIO has been dismissed in favor of the Kmart CIO. And, gleaned from media releases, most from the Chicago press, Sears Holding has cancelled their outsourcing contract after only 1 year -- the contract was for 10 years, and most of the Sears IT/Data Processing personnel are being replaced by Kmart IT/Data Processing personnel.

While KRC, the Kmart headquarters campus, will be sold, at least in the short term their Technical Center will remain in Troy, and Sears - Hoffman Estates IT/Data Processing corporate personnel are deciding whether or not to move to Michigan.

Again, repeating, just like my last post regarding Kmart's prototype test store in Troy, it seems like chaos and not managed retail.

'brewsski'

I enjoy and purchase books and music after browsing at one of the major book chains. Recently, to help someone find a store on the way to their destination, I went on-line to find them a store. One of the chains I searched made it so difficult to figure out where a store was, I went to another and found the store, location and map quickly. The chain's site which satisfied my need also happens to be the one I prefer to shop.

Websites are a fast way to find out how someone/a company/an organization thinks and organizes their thinking. A bad experience will make people think twice.

Richard Alleger, Senior Vice President, Rodale Press, Inc.

When all the research is tabulated ... a bad experience on-line doesn't boost the image of a brand's brick-and-mortar outlets. Now does an unsatisfactory experience in a store intensify an interest in shopping on-line with that retailer? In the case of today's Kmart, with the top web site design and the poorest on-line service, it would seem that Kmart is concentrating on its real objectives, whatever they might be.

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Gene Hoffman, President/CEO, Corporate Strategies International

Kmart...Great real estate play.

Kmart has been behind the eight ball for decades since they have failed to resemble anything remotely contemporary. Their Big-K remodeling effort was underfunded and unfinished. They also implemented a reckless amount of self-checkout stands that have added up to inexcusable customer service and high shrinkage.

Their negative double-digit same store sales are magnified more by the success of their peers in the discount arena. Having an aesthetically pleasing website doesn't negate their outdated merchandise selection and fashion woes. The fact that they have one of the lowest consumer demographics adds to the anomaly that anybody would think they have tech savvy customers.

The bottom line is that Kmart needs to figure out who they are because I for one certainly don't get it. Their in-store presentation needs to improve and be more in-line with their website graphic accolades. They may not be able to stop the bleeding at this point since Target has shown profound wisdom in their very aggressive remodeling schedule and extreme makeover of their stores with the P2004 format. Kmart has a lot of catching up to do. E-Business is great, but it all starts at the store level.

Sears Essential or Sears Grand??? What's the future prototype that will drive Kmart --both are unproven. Eddie Lampert is a genius with his hedge fund and real estate moves-- the future will tell if he is a brilliant merchant as well!

'CashandCarry'

Store and online experiences are merely subsets of the overall brand experience. Managing the brand experience is a concept CPG firms have been aware of for decades. Retail is just beginning to understand that with the advent of multiple channels of distribution to the customer.

Retail would be well served to have some element of brand management within senior executive ranks. The role of this position would be to monitor and oversee the execution of the brand vision across all areas which impact the consumer. All too often the "consumer portals" of store and online are seen as distinct functions, managed separately, and without strategic synergy.

Williams-Sonoma does an excellent job of delivering common values in each of it's "consumer portals." My understanding is that they have consciously chosen to view the distinct operations in that way.

I'm not a Brand expert...but there are those who write in this space often. Let's listen to them tell us how to integrate distinct aspects of the Brand experience and how it applies within the retail space.

Don Delzell, Managing Director, Retail Advantage

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