Kmart chief: We're focusing on the fun factor and meeting shopper needs
Kmart has one specific retail strategy going forward in the new year: to make shopping a fun and enjoyable experience for each and every consumer walking into storefronts, jumping onto its ecommerce site and tapping its newly updated mobile app.
"We are focused on ensuring we bring the fun back to shopping and re-energizing the Kmart brand," Alasdair James, president and chief member officer, told Retail Customer Experience in an exclusive interview. "And we’re doing that in a number of ways."
One of the top ways is the return of the retailer's iconic Blue Light special that alerts shoppers to special sales in the store, which James said is "part of our DNA," and represents "real value to our consumers in a way they understand."
Anyone who has shopped in a Kmart in the past decade or so likely can identify the siren and blue light alert that lets shoppers know of a special product markdown. Users can also buy the Blue Light special products via the Kmart app. The sale promotion first appeared in a Kmart in 1965, disappeared at some point and was most recently revived in 2001.
This recent holiday season also brought 'freebie' sales promotions during which Kmart gifted shoppers with a free item such as popcorn, a box of juice or a small toy.
"Yes, we brought back the Blue Light special but the customer experience is so much broader than that," noted James. "It’s all about bringing fun back and the strategy of how to do that," James said.
Kmart even pushed its fun strategy deep into its social network marketing effort in the past two months, inviting holiday shoppers to share "holiday excitement" by posting on Twitter using #ShoppingIsFunAgain.
It's also focused big on offering consumers spectacular retail deals. This past holiday season Kmart's top-selling product was a drone selling at $59, half of its usual retail $99 cost. Another big seller was a six-foot Dakota spruce tree selling at $15, well below its regular price of $49.
The competitive pricing, explained James, is a direct reflection of Kmart's efforts to stay on top of consumer needs and trends. It also ties to Kmart’s roots.
Now a wholly owned subsidiary of Sears Holdings, Kmart boasts a portfolio of exclusive brands that includes Adam Levine, Nicki Minaj, Jaclyn Smith, Joe Boxer, Route 66 and Smart Sense. But when the retail business was founded, under a different corporate name over a 100 years ago in 1899, it began as a five-and-dime store in Detroit.
The retailer's low prices appealed to shoppers and store expansion soon followed with 85 stores up and operating in 1912, with annual sales of more than $10 million, according to Kmart’s corporate website. The first Kmart discount department store opened in 1962 in Garden City, Michigan. Seventeen more stores opened that year, and corporate sales bested more than $483 million that year.
Kmart's decades of success, according to the retailer’s website, has long been tied to adjusting to market changes and consumer needs, and that strategy is not very different today.
"I think these things [shopping trends] change year to year and will continue. We see that and that’s why we relaunched our Blue Light app so you can get specials in store and online," James said.
One of the trends this past holiday season was providing customers with a special payment option — the layaway program — which once was a very traditional option in retail but one that has mostly been discarded by retailers.
Kmart, this holiday season, let consumers put products on layaway without having to put down a dime. The holiday season program was not only available in stores but via the Kmart mobile app via a new "Layaway and Go" feature. Shoppers could scan products from the app and add to a layaway list without having to grab the product and bring it to a store layaway counter service agent.
The layaway program was set up for consumers who are trying to budget and ties into the focus of convenience, James said.
"For us it's all about how you make life as easy as possible for customer to be able to spend their money in the way they want on the items they want in a way that they want," James said. "It's about ensuring that we have that simplicity and ease of shopping wherever the customer’s preference."
The strategy to provide great bargains and more shopping options is all part of Kmart’s approach in creating a rewarding shopping experience.
"In my experience customers expect both at all times and we will do whatever we can to deliver that for them, whether it's $3 for a mixer or a coffee machine or a $59 drone. All of these are great values. Most of our customers are not just looking for the value but it being delivered to them in a way they really enjoy, and hence the focus is on fun," James said.
The multi-pronged retail approach also reflects the varied and unique consumer segments retailers see coming through the doors. There are the aging Baby Boomers as well as the Millennials walking store aisles, whether browsing in virtual reality or pushing a cart in a brick-and-mortar location. The Millennial represents the mobile consumer generation and has become a prime focal point for the retail industry.
"I think the reality is that we have to make sure we meet our customers wherever they are," James said, noting his own mom is a Boomer who mostly enjoyed shopping in stores but is now doing far more shopping online, and that his 15-year-old daughter is an example of the classic Millennial who relies heavily on her mobile phone for everything.
"So, for her, if we don’t have a mobile solution we don’t have what we need. We will always try to have everything that our customers need in whatever form they chose to shop and as those trends change over time we will look to adapt and to accommodate accordingly," he said.
That's why in late November 2015 Kmart refreshed its mobile app, adding easy-to-use features to help shoppers with shopping lists, including a push notification feature for customers interested in learning about Blue Light specials, a new coupon each Friday and free pickup in-store options. At the same time, Kmart lowered the spend threshold for free shipping from order total of $49 to $35.
In a release on the app refresh, Leena Munjal, senior VP, customer experience and integrated retail, Sears Holdings, said the revamp reflects Kmart’s increasing mobile consumer base.
"Mobile continues to play an important role in the shopping mix. In fact, mobile's share of our online sales has increased 100 percent year-over-year," Munjal said.
Topics: Consumer Behavior, Customer Experience, Department Stores, Digital Merchandising, eCommerce, Marketing, Mobile Retail, Omnichannel / Multichannel, Online Retailing, Retail - General, Shopper Marketing, Social Media, Technology, Trends / Statistics
Judy Mottl / Judy Mottl is an experienced editor, reporter and blogger who has worked for top media including AOL, InformationWeek and InternetNews. She’s written everything from breaking news to in-depth trends. She loves a great pitch so email here, follow on Twitter and connect on LinkedIn.