Sears Trying to Raise Consumer Electronics Profile

I think Sears has raised its profile in electronics. However few consumers would want to endure the feeling they have purchased a product sold by the retail industry's laughing stock. Imagine the sinking feeling one might have after they tell their friends they bought a new TV at Sears? I looked at those Sears websites and nowhere do they guarantee they will beat Wal-Mart or Best Buy by 10% which is what they would need to do to have any kind of credibility.

Congrats to Ms Austin for making it a year on the job. That's probably a record for this past decade at Sears.

David Livingston, Principal, DJL Research

I've seen the commercials with Brett Favre but this deserves a big whiny c'mon man! How can you possibly compete in that category when you don't sell what people want? Limited selection, horrible inventory levels and blue shirted people who don't know anything about the products they sell is not going to increase your presence in the category. Sears should look at fixing their business first before focusing on one particular category.

Doron Levy, President, TheMortgageMachine.ca

My nostalgia for all things Sears is well-known here on RetailWire. Having been raised by a former Sears executive I had personal experience with Sears in its golden years. But, it is a different world than it was back in the day and the market forces are a lot less forgiving with pressure coming not only from competitors but from the consumer as well.

I think this is another good move in getting back to the basics that made Sears a ubiquitous brand. The real test will come in their ability to envelope this category in an experience for the customer that not only delivers a positive purchase experience but provides excellent after sale service as well. It's no longer enough to espouse satisfaction guarantees; they must back it up with the real deal.

Marge Laney, President, Alert Technologies, Inc.

It almost seems cliche to use the term "late to the party," however, Sears faces an uphill battle now that Best Buy, Walmart and Amazon have serious traction and more clearly-differentiated points of view. As Best Buy pursues private label with a vengeance and Walmart sticks to its brand-central approach in CE (yes, I'm borrowing from Sears' old ad campaigns), I would consider Walmart to be Sears' most formidable foe on the ground and Amazon in the air.

Pumping up associate training is probably Sears' best hope; however, they can't afford to focus on technology expertise exclusively. In such a competitive environment, they must nail the sale on the spot or forever lose shoppers to price-matching retailers and etailers.

Carol Spieckerman, President, newmarketbuilders

Sears has done a great job with its website in the appliance categories. Most shoppers visit the Sears site to check out appliances' features, benefits and ballpark prices. However, shoppers may or may not actually purchase their appliance from Sears. It's pricing and in-store experience that need work.

Sears may help itself by modeling its electronics department on its appliance template, at least in the digital space. But paying off the electronic experience in store with associates' knowledge, good pricing, and depth of inventory will be the challenge.

Liz Crawford, President, Crawford Consulting

This strikes me as announcing that Seiji Ozawa will be be a guest conductor for the violinists on the deck of the Titanic.

Karen does indeed deserve enormous credit for making all the right moves. Unfortunately it's being done in a venue that has morphed out of retailing and into a real estate play run by financiers. My guess is she will join a long list of highly accomplished merchants who will do all the right things with very little to show for it.

Bill Emerson, President, Emerson Advisors

I think your head is buried in the sand if you aren't aware that Sears is in the electronics business. The marketing efforts referenced as well as historical efforts are aggressive by any advertiser's standards.

Category kings like Best Buy will always be top of mind as a destination.

Online tools that help you pick the right product will soon be an expectation and not a differentiator if they aren't already. Buy online and pick up in store are also offered by multiple retailers.

High ticket purchases like electronics do often mean building a relationship with the right retailer because store associate expertise, service, and selection become that much more critical.

Sears is big enough that they should be able to be competitive on price and selection. The question for Sears is whether they can build enough credibility and awareness around product expertise and service. Geek Squad TV and Home Theater Services for example, as offered by Best Buy.

Matthew Spahn, President & CEO, planitretail, LLC

Wow, an area where Sears is actually making some investments! I wonder why Lampert thinks he can get a return on electronics...it doesn't seem to be paying any dividends so far.

'mikeb22'

It's a tough category to compete in for sure, these days. There is really one dominant large category player left and the discounters and clubs are commoditizing many products, thereby making price a major factor. That does not bode well for Sears.

On the positive side, they are starting from almost nowhere as the article says so now would be the time to put on their innovation caps and go to work. They have consistently shown competitive multichannel capabilities, so I like that they have some focus there. Good assortment - check, competitive pricing - check, good store displays - check, trained employees - check, web tools - check. OK; that's the ticket to entry, now tell me why I want to buy at Sears instead of Best Buy, Walmart, Amazon, or Apple?

Paul R. Schottmiller, Senior Director, Global Retail and Consumer Products, Cisco Systems, Inc.

Sears has been in the electronics business for decades. I remember watching the Watergate hearings in the Sears TV department while on my lunch break. Karen Austin is probably doing all the right things, but it's hard to imagine how Sears' reputation for spotty, dated inventory is going to overcome her efforts.

Cathy Hotka, Principal, Cathy Hotka & Associates

Sears is in fact making progress in CE goods. The moves by Ms. Austin are all sound, and it is having effect. Sure, we can all criticize Sears, but to some extent this is an inside play. While it is fun to throw things at their team of blueshirts, they are really not bad in comparison to what is out there. This is a tough category, but one of the strongest calls to consumer traffic, so expanding and protecting it makes sense. As this has become a mass market category, then it also makes sense for Sears to play. While we can all wonder about the overall strategy and future of Sears Holdings, this is improvement and should be noted as it is due.

Robert Heiblim, Principal, RH Associates

Sears shows up with high visibility among appliance shoppers--particularly 35-64 year olds. However, the 18-34 year olds represent a "lost generation" to Sears' electronics (TVs, Computers, DVDs, etc.), as does the 35 -64 year group.

Taking the message to online offers solid upside, but Sears will still have to deliver on product quality, innovation, and an understanding of this younger audience. When asked "Which store do you shop at first for Consumer Electronics," the BIGresearch monthly Consumer Intentions & Actions (CIA) Survey points to the fact that only 1% of 18-34 year olds choose Sears, while 2.8% of 35-64 year olds choose Sears for Electronics first.

Some serious work to be done to recapture the best days of "Brand Central."

Roger Saunders, Managing Director, PROSPER BUSINESS DEVELOPMENT / BIGinsight

Sears has had Home Electronics for as far back as their catalog days. However, the question isn't if a shopper would go there for Home Electronics, the question is why a shopper would go there at all. There are three serious problems with this strategy.

The first is what to do with the Sears brand. This brand is "Your Father's Oldsmobile." It doesn't matter what Sears does on a category by category basis. "Sears" means something in the shoppers' minds and it isn't pretty.

The second problem is that they are operating with the department store business model, which even the best department store merchants are having difficulty with.

And, lastly, why, oh, why, would this retailer invest in a category that they can't possibly win in? They would have to beat each of Wal-Mart, Best Buy and Amazon at their own games. Mr. Lambert isn't ready to put the resources together to that and he would be foolish to do so.

Perhaps, the real answer to what to do with Sears is to truly pursue the store-within-a-store strategy. Rent out the categories to people who can be successful with them. That might put the real estate to good use.

Gene Detroyer, Entrepreneur, Advisor, Consultant, Professor, Independent

"When 20 percent of shoppers in your stores don't even know you're in a particular category..."

Ah but 80% DO know then, right? I'm curious how "electronics" was defined: presumably it is restricted to TVs, DVDs and the like; if it includes larger appliances, then Sears' cause truly is hopeless, since Kenmore was long seen as a preeminent brand...even for that ill-informed fifth.

'notcom'

Sears does not have a monopoly on electronics sales people who don't know much about what they are selling. I bought a LCD flat panel there in late Nov. 2008 because it was the model I wanted and their one-day special price was about 17% under competition. But all being equal, I would probably have gone elsewhere. In the Columbus, OH market, HHGregg seems to be the electronics price leader at the moment and for a large segment of the public, that is paramount.

Jerome Schindler, Counsel, Imported Foods

Even my 'fave' Brett Favre won't help. As mentioned, eighty percent of their customers do know that they are in a category. Their appliance and electronic commercials are quite smart. The problem is that customers are, too. Sears gave customers too many reasons to go elsewhere for too long.

Getting customers to return once you've forced them elsewhere is far more difficult than retaining them in the first place. Whether it was conscious or unconscious action by Sears to send their customers elsewhere for years--that's what they did.

Their customers know what they have. They always have. That's not the problem. They know and they don't actually care. Sears actions as a retailer for decades have been "Go somewhere else--I dare you!" Now granted, it was not in so many words, but let's face it--that's what they did. It's a big hole to dig out of that they are in, but the problem isn't their customers knowledge of what they sell. The problem is they don't want to buy it there. I don't either. There are to many other choices.

'Scanner'

Sears has been scratching and clawing in this category as well as others, but it's hard to detect that they've gained any real traction. When you've trailed the competition so badly across just about every category, you can pick up business on the margin, but it's very hard to regain any real relevancy.

Ted Hurlbut, Principal, Hurlbut & Associates

Many of the comments listed here by other commentators are brilliant and would help Sears if they would find one they like and institute it. The hard part for Sears is sticking with something. As also raised by a Sears store employee, my parents always knew what Sears was best at, and when to go elsewhere to satisfy their needs.

What does Sears excel at today? What do they have the guts to at least be competitive in today? Electronics? Wow, that is a long shot, particularly when you consider the mall base of many of their stores. Best Buy's strategy of locations make a quick and easy shopping trip, well...easy!

We need Sears. We need Radio Shack. Why can't they both get it right?

Jerry Gelsomino, Principal, FutureBest

Sears has been in the electronics business for years and somehow, like much of the rest of its business, let a position of strength slip away.

From a consumer standpoint, only the recent ads with the Brett Favre raise awareness. No other indicators are present which would let consumers know that Sears is attempting to compete with Best Buy, Comp Usa, BrandsMart, and others.

We've been working to define Customer Engagement and Sears would be well advised to look into the same subject.

Bill Hanifin, Managing Director, Hanifin Loyalty LLC

Sears has many obvious challenges in order to be successful in its attempts to elevate its status as a reseller of household and personal "high-tech" consumer electronics. Category awareness, brand panache, and even sales associate expertise are all things that programs can be put in place to address.

In my opinion, however, its greatest challenge is actually one of real estate. Most Sears stores are located in malls which draw a clientele to support its traditional soft-line businesses (price-sensitive women, aged 40-65) as well as the married, homeowning male who shops for tools, appliances, tires, and car batteries (thus the associations with Bob Villa and Ty Pennington). This real estate, however, does not provide optimal or convenient access to 20-30 year old singles or young married couples with above-average discretionary income who tend to over-index in terms of money spent on electronic wares that enable today's digital lifestyle (laptop computers, connected gaming systems, personal audio, satellite radio, mobile telephony, etc.). On the contrary, the Apple Store's mall real estate strategy is to specifically target malls and other locations that provide convenient access to the digitally-active young affluents that Sears cannot.

Vincent Young, Founder, retailleverage.com