Sears Watches Others Grab Appliance Sales Share

Discussion
Aug 26, 2005
George Anderson

By George Anderson

Sears is still the number one seller of major appliances in the U.S. but others, notably Home Depot and Lowe’s, are gradually taking share.

According to a Chicago Tribune report, Sears saw its market share drop from 36.9 percent to 33.1 percent over the last year. Lowe’s grew its share from 14.5 percent to
16.1 percent during the same period. Home Depot went from eight percent to 9.2 percent.

“Sears is still the No. 1 appliance retailer, but it’s going through a difficult patch and is still being challenged not only by Lowe’s and Home Depot–which is an old story–but
by independent retailers,” said Steve Smith, editor-in-chief of the trade publication Twice: The Week in Consumer Electronics.

The retailer has emphasized its hard lines in a number of ways, according to the Trib report. “Sears has expanded the number of its appliance and electronics outlet stores,
added appliances to most of its freestanding hardware stores and boosted its inventories of lower-priced white goods to complement its selection of higher-end appliance brands.
And, in the wake of its merger, Sears has even introduced appliances in some Kmart stores.”

Moderator’s Comment: Is Sears doing the right things to reclaim market share of appliances? Where do you see weaknesses that need to be shored up and
strengths that can be further leveraged?

Do not get us started on Sears’ service.
George Anderson – Moderator

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10 Comments on "Sears Watches Others Grab Appliance Sales Share"


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Gene Hoffman
Guest
Gene Hoffman
15 years 6 months ago

Sears sent its “new” soul into the after fair

To seek help in re-growing its appliance share.

A voice came back whispering in Mr. Eddie’s ear,

“Stay on course, exploit Kmart and have no fear.”

Meanwhile, other retailers not hearing that voice

Continue to merchandise to contemporary choice.

Lowe’s, Home Depot and independents sales now rise

And soon what will be left is a Sears surprise.

Moral: Have your hearing checked regularly.

Doug Fleener
Guest
15 years 6 months ago

Where I see Sears in real trouble is 5-10 years from now when the most likely buyer will be someone who sees Sears as their parent’s store. This consumer will be a loyal and regular Best Buy customer, or as a first time homebuyer will already be a regular shopper of Lowe’s and Home Depot.

For the product, it looks like a classic squeeze play as others have noted. The independents are getting the high end and the home building guys are getting the other end. When you’re stuck in that middle, you just keep getting a little bit chopped away from both sides.

carl KROOP
Guest
carl KROOP
15 years 6 months ago

By selling more opp items, they will increase unit sales but decrease selling price and profits. People who buy low end units are less likely to buy service contracts that add huge dollars to the bottom line. It takes up the same space and sales and delivery cost to sell a $250 washers as a $1000 washer–the higher price unit has more profit than the whole cost of the opp unit. Are they in the business to make profits or do they want to sell more units and lose money? I think they have to make up their minds—if they are not in business to make money they might as well close and sell off the assets. You can’t sell and lose money on every sale, but make it up on the volume.

Brian Kelly
Guest
15 years 6 months ago

Sears has not remained in touch with its customers, therefore, the shopping experience pales in comparison to the most fierce competition Sears has ever faced.

Sears milked the category and was unresponsive during the real estate “bubble,” as well as its own “Softer Side” period, and never fully developed a more aspirational side to the category and brand.

Kenmore Elite came up short and didn’t fulfill the promise of a needed position in the super high premium end of the mix.

Ironically, Lowe’s and HD stripped-down, big-box in store experiences match favorably and Sears loses out on service.

Plus, consumers tend toward winners, and Lacy took care of that aspect of brand Sears.

David Livingston
Guest
15 years 6 months ago

I’m not an expert on this matter but I did recently buy a new house and stocked it full of appliances. I shopped 3 stores – Sears, Best Buy, and American. Sears was eliminated immediately. First they would not negotiate on price. Then they wanted to charge for delivery. And third, they were just too darn expensive. Being located inconveniently in a regional mall did not help either. American won out. I was able to pick out everything online. Then, I went into the store and got the salesman to throw in a little extra discount by beating the competitors pricing by around 5% and free next day delivery. Sears thought they were just too good to do that.

Bruce Vierck
Guest
Bruce Vierck
15 years 6 months ago

Sears may be making changes to their product assortment, but their in-store experience remains the same — out of sync with today’s shoppers. Shoppers are more educated, more mindful of value, and more insistent on achieving clarity around their product decisions. The Sears shopping experience is still characterized by salesmen in bad suits stepping over each other to sell you an appliance from a collection of products lined up like soldiers in an uninspiring shopping environment. How is the environment expressing a point of difference from Lowe’s, Home Depot and higher end independents? How do I understand my range of choices as I navigate the appliance department? How do I access information in order to build my competence and confidence in making a selection? As long as Sears still feels like Sears, without an emphasis on changing the appliance shopping experience, their market share will continue to shift to retailers who are creating greater clarity around their offering.

Todd Hale
Guest
Todd Hale
15 years 6 months ago

My wife and I had our water heater rupture on us one Friday evening before an office holiday party. We called Sears and they couldn’t get someone to install until Monday. We called Home Depot and Lowe’s and both offered installation on an emergency basis. Guess who didn’t get the order?

Robert McMath
Guest
Robert McMath
15 years 6 months ago
Having moved twice and bought a second home also in the last five years, I have seen what used to be a good department staffed with knowledgeable and helpful people sink to new lows. The last time I was in a store in Oceanside, California, I had to wait for twenty minutes to get the attention of a salesman on the floor who saw me standing near the water heater and water filtration area, while there came some people looking at washing machines and dryers even as I waited. I was looking for a filter insert for a Sears in-line water filter, so I had to talk to someone. The salesman went from one sale, then another customer who came after me — and finally came over after 20 minutes or so. And when I mentioned what I needed, he told me I had to order from the service department and couldn’t place an order with him, even though there were some similar filter units to what I was seeking an insert for. He quickly… Read more »
Mark Lilien
Guest
15 years 6 months ago

Sears is losing share to the home improvement guys because, in the good old days, when Home Depot was king and Lowe’s was a pigmy, Home Depot ignored the appliance opportunity. Lowe’s showed HD how to sell appliances, and HD is getting aggressive in that category. Unless Sears meets the aggression and escalates the war, they will lose share. In wars, both sides have casualties. Sears can reduce prices and offer free financing but the margin damage becomes painful, since their cost structure is higher than HD and Lowe’s.

David Livingston
Guest
15 years 6 months ago

After thinking more about Sears I decided to go give them a shot tonight. I got there about 6 PM on Sunday night and they were closed. CLOSED!!! It’s the busiest shopping day of the week and they are closed by 6 PM. Barnes and Noble next door, along with all the trendy restaurants at the mall were all packed with customers. What was worse is that Sears doesn’t even open until 11 AM on Sunday. Maybe stores back in the 1950’s had hours like that. Imagine if Wal-Mart closed at 6 PM? I drove by one nearby at 6:15 and it was packed with cars parked out to the highway.

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