Critical Analysis Assignment #3
Traditional retail stores are in a dogfight with technologically advanced online mega retailers. Retail stores such as BestBuy, Sears, and Blockbuster are on the verge of going out of the business due to customers’ increasing online purchases from Amazon, Overstock, and Buy.com. Click stores are able to gain competitive advantage over brick and mortar stores by maintaining low inventory, fewer employees, and by providing a personalized shopping experience. At one point, Sears dominated the full line retail market by providing its customers various mid to high end products under one roof, while its subsidiary, Kmart, provided low end products. Currently, Sears and Kmart are on the verge of bankruptcy, and its business is steadily declining due to the emergence of online retailers. Recently, Sears closed 120 stores, and it is planning to change the location of, 1200, franchised stores. Sears’s declining revenue was a wakeup call for its CEO, Lou D'Ambrosio, who formed a new strategic plan to rescue Sears from bankruptcy by using technology to provide a personalized shopping experience, and by introducing a loyalty-rewards program accompanied with changes to store layouts.
Sears plans to use technology to provide its customers with a personalized shopping experience; however it fails to attract customers because its competitors have already implemented this technology. Employees will be equipped with an IPad and IPod touch to provide customers with online reviews of a certain product and to check inventory in real-time. In order to provide these services, Sears will deploy the global positioning system and data mining technology on handled devices carried by the employees. Using data mining technology, employees will be able to guide customers to the products they are likely to purchase based on history of purchases. These technological advancements have already been implemented by