Case Study

Topics: Marketing, Retailing, Sears Pages: 6 (991 words) Published: February 23, 2015

Sear: Seeking A More Fashionable Image
Cherry Anne Bilan-Lorenzo
Master of Business Administration
College of the Holy Spirit of Manila
Marketing Management
Dr. Lilia C. Chio

Sear: Seeking A More Fashionable Image

Sears, Roebuck & Company became the nation’s largest retailer by making household names out of “hard goods” brands such as Craftsman Tools, Kenmore appliances, Weatherbeater paints, Road-Handler tires, and DieHard batteries. However, Sear’s preoccupation with hard goods has also hurt the retailer. During 1980s Sear’s merchandise operations lost market share steadily.

They hired Ms. Lee Hogan Cass to be its women’s fashion director, which was unusually because the position has been vacant for nine years. They decided to refill the position as part of its sweeping strategy designed to restore its stores to prominence.

One of the company’s earlier moves was to switch to a radical “everyday low pricing” strategy. They added national brands such as Panasonic and Whirlpool and revamped displays into what it calls “power formats”. Despite their attempt the result was a staggering net loss of $134 Million in the first 3 months of 1990 which became one of Sear’s worst quarters ever.

Statement of the problem:
Why would Sears, known for its hard goods, turn to women’s fashions as the latest vehicle in its attempted rescue operation? How would you characterize Sear’s overall retail store strategy in terms of amount of service, product line sold, relative prices, control of outlets, and type of store cluster?

The major reason why Sear is turning to women’s fashion as their latest vehicle in their attempt to rescue operation is because over the years, Sears has located more than 2/3 of its 850 stores in shopping malls. Also, most shoppers at these retail mini-cities are on a mission to do one thing which is to buy clothes. Apparel accounts for more than 70% of non-food sales in malls and because Sears cannot relocate 2/3 of its stores, it must join the trend toward soft goods.

The company has always sold women’s apparel but the problem is that executives at the first Sears store insisted that to make shopping a family affair they made the wrenches, paint, hardware and tires be amply displayed with the women’s apparels.

One of Sears’ management mistakes is to put fashion in the back seat. Their marketing approach is also inaccurate. They promoted fashion items the way they might promote new tires. Sears has also been slow to dive on trends. They often stuck with same products or merchandise. The company’s women’s department was well known as the “bag lady” of retailing which is a bad company image. Most of the women’s fashion areas of other stores are shabby and cluttered; they also have few fitting rooms and mirrors. Sear’s buyers have also traditionally chosen apparel colours the way customers but the company’s paint from what they called the “color card” which divided into palettes such as pastels and bright. This a approach results to a mind-numbing array of hues on the sales floor.

Central Issue
Although Sears also sells men’s and children’s clothing, selling women’s apparel causes the most problems. Sears has to figure out how to get women come into the stores. Unless Sears can attract more women its growth will remain dim. Sears’ efforts to convince major apparel houses that it is truly serious about clothes have sometimes fallen on deaf ears.

SWOT Analysis:
They have almost 600 stores in shopping malls
They are leading in industry brands for “hard goods” products Extensive brand portfolio
They have multicultural customers

Advertising and Promotion
Product Placing
Image and Branding
Quality Control
Market Segmentation

Competition for from Best-In-Class-Retailers
Emerging Markets
Growing online retail spending
Expanding international operations

Big rivals are already well along...
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