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Just Wait To See What Happens With Kmart

In May of 2002, Sears bought Land's End for $1.9 billion in cash, representing a 21% premium over the current share price.

Yesterday, as the snows were hitting Chicago and I became instantly aware of my need for a new winter coat, I took a quick right turn into a local mall and ran into Sears to see what kind of warm jackets they had.

The men's department had a great selection of winter coats, all on sale. (On January 5th, one week into winter, as a winter storm approached. Why were they marked down? See below.) There were many models of great looking Land's End jackets, all at great prices. I was pleasantly surprised with the selection.

I had lots of questions about the Land's End jackets, to make sure I got the lightest weight jacket for my needs. I asked a Sears store clerk for help who said, "They don't train us on any of that."

Luckily, there was an 800 number in the jackets, and I called Land's End on my cellphone. They were really helpful, but I kept getting cut off due to poor cell reception. I asked the same store clerk if I could use her phone to get answers from Land's End so I could buy a jacket and she said, "If it's toll free."

This is a really brilliant idea: Buy a company for a 21% premium so you can get their merchandise in your stores, and then make it a real hassle for your customers to buy that merchandise. And, be sure not to tell your employees how to sell it. How stupid.

At the time of the acquisition Sears CEO Alan Lacy said that the Land's End acquisition "will attract new shoppers ... who will connect with our apparel departments better than they would have in the past." Yes, Alan, this was a great connection.

Steve Yastrow posted this on 01/05/05.

Comments

Went to Sears Automotive over the holiday to purchase a new car battery, confident that the DieHard Express lane would speed me on my way. Stood behind one customer who was being helped. The sales clerk finished the transaction and said to me, "I will be right back, I just have to get this job started." No problem. Fifteen minutes later, two employees appeared from behind the scenes, walked to the counter, handled their transactions and left the sales area without acknowledging my existence. I waited five more minutes and then called Sears Automotive on my cell phone. Fifteen rings...no answer. I hung up and called again... four rings..."This is Gabriel" Hi Gabriel, my name is David and I have been standing at your counter for 20 minutes. Gabriel came from behind the door, took my order and quoted 45 minutes. I went on my way to shop, returning one hour later. My car had not been moved. Waited in line. Why is my car not done? We are busy and we will get it right in. Only ten minutes after that. They got it in 15 minutes later. I watched them work on the battery and then walked outside for fresh air. Now 1:45 into the journey. Saw the original guy walk to his truck and then, seeing me, head another direction into the mall. I went back in. Hood was raised but no people. Walked to the car...no battery inside. Went inside the sales area. Waited in line. Gabriel looked at me and immediately walked outside. Walked out of Sears Automotive 2:15 after my arrival. Before I left, I asked Gabriel why he was working so hard and did not have any help during Christmas week. He said, "Good question. Ask the manager." I wrote to Sears Customer Service two weeks ago. Never heard back. I am 41 years old and grew up in Sears. So did the 100% of baby boomers who I saw in Sears Automotive. After we are gone (as I now am as a customer) Sears will be on a rocket sled to profit hell. Good news is that the K-Mart mutation should hasten the journey.

Posted by David Porter at January 5, 2005 10:36 PM


fool for not researching your purchase in advance on "their" site - shame on you poor consumer

why you would expect any service what-so-ever from K-Wal-Sears-Target-Mart is the real mystery?

Posted by ishamal at January 5, 2005 10:36 PM


Ishmael ... I don't understand what you're saying to David. Are you saying that he could have gone the Sears website and learned that service at Sears Automotive sucks?

The way it really works is that people who have known brands for years easily notice when the brand slide downward, and then leave the fold one by one, and the brand dies a death by a million pin pricks.

Also, I think that the issue is not that Target and Wal Mart are in the same boat as Sears and Kmart. The fact is that they have figured out a better way ... it's not based on great service, but it is also not based on tolerating crappy service.

Posted by Steve Yastrow at January 5, 2005 11:03 PM


Sears would do well to have hotline phones and web-enabled computers with direct lines/links to Land's End. A customer could then browse product information, ask questions, etc. In such instances, customers could feasibly (more easily) tolerate that crappy service we've come to expect and love...

Posted by Lee H. Igel at January 5, 2005 11:15 PM


I'm so unsurprised by your experience, Steve, that my main surprise is that you expected anything different. It doesn't take a business historian to know that the majority of acquisitions are ultimately failures, and Sears has been wrestling for decades with internal strife surrounding whether they should only sell in-house brands at a maximal margin or expand to other brands and trade off lower margins for wider selection and more overall transactions.

This is why Brand Central came and went, why the Sears tool stores came and went, etc etc. Adam Hartung has some excellent thoughts in this regard too, as Tom knows. :-)

What baffles me is that there are CEOs that think they can successfully expand into a new market segment -- particularly within the tired venue of their own retail storefront -- by buying another company rather than "organically" moving into that line through value web expansion, etc.

Should the Sears employees be trained on the new merchandise? Of course, but the fact that the employee even shared that there is a training program with a customer shows one of the greatest challenges of low-cost retailing in the 21st century too: the quality of employees. My guess is that even if Sears did offer a training program for Lands End jackets that the employee wouldn't catch the nuances of quality, fit and fabric, and would just shrug and say "dunno, read the tags" in response to your questions anyway.

Ah, this just makes shopping online look better and better, doesn't it? :-)

Posted by Dave Taylor at January 5, 2005 11:55 PM


Sears (and Kmart and some of the old ones) aren't what they used to be. Markets changed. Some retailers changed with the market, but some didn't.
However, "markets" include competitors AND customers. So while some retailers were busy adapting to Wal-Mart, they forgot about their customers and market segments... and down they go dragging their brands along with them!
Sears is providing service quality levels worthy of discounters, (at least I hope it's on purpose as part of a plan to reposition itself...) but for most of us, the brand "Sears" still means "Department Store anchored in a mall" and "Department Store anchored in a mall" implies some particular attributes in the service that a customer expects, including the knowledge of the merchandise by the sales reps and their willingness to help.

Gabriel Salcido

PS1: ...by the way, Sears started to experiment with grocery aisles a-la-Wal-Mart.
PS2: ...and for some of us, the brand Sears still means "Catalog Sales". What would happen if Amazon decided to open a chain of "bricks-and-mortar" stores, just like Sears and Montgomery Wards did 80 years ago?
Time for my medicine...

Posted by Gabriel Salcido at January 6, 2005 2:51 AM


Hi there!

Just noticed the thread regarding customer service on Lands End jackets.

I work in the outdoor activity trade in the UK as both a store manager and a clothing/equipment journalist. The problem here is basically a staff training one. Product information shouldn't be only available online, it should be provided by the respective store's HR or Training Department.

Many non-specialist stores don't always hire people with experience in a particular field so any technical questions can't always be answered.

Staff training sessions can go a long way to filling the gaps in knowledge regarding specialist products, but such knowledge should be there anyway.

I have a new deputy to appoint when I get back to work after my recent illness and I will be endeavouring to appoint someone with prior knowledge of outdoor or travel products such as tents, packs, clothing etc. I'll also be looking for someone with a few gaps in their CV - especially if those gaps are there because of travelling around the world or whatever as life experience is much better than stuff learned at staff training sessions.

I'm constantly surprising my customers with my knowledge, basically because I work in an outdoor shop, but also use the products (when I'm not recovering from a small stroke!!!), have worked as an outdoor writer for 15 years and was also an outdoor instructor for nine seasons. It aslo helps that I learned some gueriila sales techniques by spending a few years managing rock bands over this side of the pond too.

People in my last store came back time and again -one guy even said that I'd inspired him so much, I'd changed his life! The store I now work in is in a tourist area, so there's fewer regulars, but even so, tourists deserve the best that they can get. And yes, I do point them in the right direction to another store in town if I can't help them out. You'd be amazed at how many people come back to you for other stuff when you do that!

That's my two cents worth anyway...

Cheers from England

Keith Rickaby

Posted by Keith Rickaby at January 6, 2005 7:02 AM


Steve,
I have been a Land's End customer for many years. I have been to Sears several times and have been disappointed in the way they are handling Land's End merchandise. No tall sizes (a prominent feature in the L.E. catalog). Plus, no one really seems to be aware or trained to handle their line. (I am usually in the men's department). Just hope Sears doesn't start trying to do something with the LE catalog system.

Posted by Jim Martin at January 6, 2005 7:33 AM


Steve - "I feel your pain" and since I'm a Sears non-user and Lands End fan - thanks for the update. You seem to be like me - I walk around noticing "service" that is poor to outstanding and the "branding" that eminates from such. Maybe the hip-hop Gen Y customer "service" types are the challenge?

Posted by Brad at January 6, 2005 8:18 AM


It's not just about lack of knowledge - it's an attitude thing too.

As a positive story - I recently went into a John Lewis in the UK (dept store). I wanted to buy a hamper (multi luxury food) present. The label didn't say if it was vegetarian friendly so I asked an assistant. She didn't know BUT immediately said “give me a minute I will check” - a minute later still no joy.
“give me a minute and I will phone the manufacturer” - still no joy (manufacturer's fault)
“Ok give me a phone number and I will find out”
2 hours later a phone call giving me the info – Now that is an attitude I can buy from

Interestingly some of these people work for this store for a long time (a few of the same faces in the store for literally decades). I understand the company tries to work hard to keep staff for longer periods.

So what does that say for our much quoted philosophy of a job lasts a nano – second and brand you is the only thing??? If these people believe passionately in the company and are genuinely part of that brand (and quite frankly are very very good at their jobs) why do they need to change?

Are we expecting too much to have instant brand consistency and service? Does a brand actually have to work it's way into an individuals DNA over years before they really care? Love? (watch out real emotion being talked about here!)the company they represent?

canadian viagra pack Posted by PaulH at January 6, 2005 8:31 AM


Steve - - - I've been a Lands' End customer for a number of years. Their quality and service is super. Sears has been and continues to be, the example of poor service. Buy directly from L/E. You'll be pleasantly surprised. (In my experience, L/E's UPS delivery is before their stated delivery date!)

Posted by Gary S at January 6, 2005 10:02 AM


"I don't want to sound like a coach who blames his players, because I'm not. We teach. We're the coaches. It's our fault." - Coach Gene Keady, after Purdue Loss to Wisconsin 1/05/05

Management all have the resources to train individual to sell a product. They have all read the numerous books that focus on "Customer Service". Obviously, some don't care. They think that the looks of the product will enable it to sell itself.

Unfortunately, we live in a world of "Social Disorder" where most people don't care about the person across the desk from them. Hey, if this auto service center closes. I can go work at the one down the street. Management, has to teach/ coach others how to be "Service" minded But, first they have to believe! order viagra online from canada

Maybe, Steve, should send a thread of all the experiences listed here to Mr. Alan Lacy-Sears CEO, he now owns 125,854 shares of the company. According to todays Chicago Tribune

Posted by Sean at January 6, 2005 10:26 AM


I say good for everyone who expects some element of service. Whether I'm at Sam's Club, Saks, or my favorite running shoe store, I want to feel good when I'm there and when the experience is over.
Years ago, pre-Target rise, Sears developed its "softer side" to engage hearts and minds of women. I remember one of my four daughters, youngsters then, wondering aloud--"I thought Sears was a tool store" (she meant that they sold tools, not that their target market was tools).
Living in northern New England where the picking was slim and online shopping was in infancy mode, I decided to try Sears out on my day off for some kids' clothing. This was a safari--saddling up four kids, under age 10, schlepping them in and out of the old family van on a snowy day. I was ready to roll in and out. Anyone who could have seen me trying to maneuver four kids around crowded aisles that seemed to have more tools than soft stuff would have recognized that my situation screamed HELP ME and could have become our sales pro for life! The opportunity was there for the capture--I was eager to have my heart and mind engaged, to outfit the kids with things that delighted them and to get out of there. Suffice it to say--no soft side there.
After wandering around for what seemed like a year, we ditched the soft side and fled to the local kids' clothing store where the prices were steep, but, with a sales person who recognied four kids with dramatically different styles, her assist gave the kids a great time finding what they wanted with ease. The experience was fast, to-the-chase and friendly. So much for softer sides. For me, service is about connecting fast, having someone listen to me to provide an assist to help me find something that fits my purchasing need, personal style, and budget fast and get it done. It's about how I feel when I'm there--and when I'm back in the car and it's over. Now that's service that's a gift that keeps on giving.

Posted by Dr. Pam Brill at January 6, 2005 10:28 AM


My story is eerily like the first post here by Dave but instead of "Went to Sears Automotive over the holiday to purchase a new car battery," I went for a motorcycle battery. I was lucky because I walked in before a huge rush and I got the one employee there who had any history (My help told me that two others that occaisionally wandered through were "new hires").

My guy knew nothing at all about my request but knew resources and got information (points up for him). He kept being pulled away by the new hires though, who didn't know product and weren't keeping up at all with the crowd, and I was lucky to walk out with my $100 motorcycle battery in a about a half hour. Clearly, this Washington store doesn't normally staff well and then they dump on the long term staff to bring new people on line while they're handling the busy season. Nothing like good management...

Posted by Boyd at January 6, 2005 12:07 PM


Wow. In this age of "Youniverse"/customizing/ do-it-yourself" servicing, Sears is headed the wrong way. When a customer can now scan an item with their cell phone, immediately be connected to Amazon (which sells the product at a lower cost), all, ALL retailers should be on Code Orange, if not Code Red. Connectivity rules. I can see so much potential for Sears but unfortunately, they seem like an ancient dinosaur, lumbering through the forests of yesteryear. Old. Gigantic. Not able to zig when the zag is long overdue.

Sounds like the CEO needs to send every employee Peters' "The Brand You 50." Pronto. Then deconstruct their image.

Posted by Mary Rose Maguire at January 6, 2005 3:36 PM


I forgot to add something else.

Dr. Brill, I felt your frustration through your words. It's amazing, isn't it, how many people will go to another business - even if it's out of their way or more expensive - because the service is better. You said something I wanted to comment upon:

"Whether I'm at Sam's Club, Saks, or my favorite running shoe store, I want to feel good when I'm there and when the experience is over."

Amen. Sears? If you're listening, take note of one word. If you focus on this one word, you just might turn things around.

Experience. What is the consumer's experience with you from start to finish? Everyone wants a good experience. Even a solopreneur such as myself "gets it." C'mon, Sears. Don't die of apathy.

Posted by Mary Rose Maguire at January 6, 2005 4:05 PM


At the risk of sounding like a cliche', I wonder if Sears knows what business they are in right now?

Posted by Erick Blackwelder at January 7, 2005 1:08 AM


Erick - they're in the business of staying in business.

And if they focus on staying in business, they won't stay in business. Especially if "staying in business" means buying Land's End and Kmart.

Why are all those people in their stores? (Okay, their stores are probably doing half the volume they did 10 years ago, but whatever.) See what they need, meet those needs the best you can, and they'll come back.

No store can be all things to all people - Dr. Pam needs to feel good, I need to pay the lowest price possible - but a focus on the customer, who ultimately pay their bills via purchases, is sure better than focusing on existing. Otherwise, will they even exist in 10 years? TP, how many years do you give Sears to stay in business?

Posted by Ron at January 7, 2005 11:07 AM


Ha! Sears thinks paying $2B for fleece/polyester/goretex/down/colors/logo/etc -- ie the product -- is a good deal?! They must cause that's all they’re selling. Pity! They obviously don't understand that LE threw a nice little freebie into the package: the LE Brand...nay, the LE Story.

If a shareholder(I'm not) I'm pissed as hell that they bought a body of experience, ripped-out its heart, and have chosen to sell soulless mannequins, instead. Like me paying $29B for Starbucks(I live in Seattle), then choosing to sell the same coffee out of white styrofoam cups via a drive-thru window and charging $4 apiece. A'int gonna fly!

There can be no story without a storyteller. Who’s to tell LE’s?

Posted by Russell A. Hatfield Jr. at January 7, 2005 2:03 PM



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