Sears (NASDAQ:SHLD) is rethinking its strategy of closing stores and relying on a loyalty program. Instead, the retailer plans to open smaller-format appliance stores, focus on its best product categories and rethink the Shop Your Way membership program.
A 10,000-sq.-ft. appliance showroom will open in Fort Collins, Colorado on May 19. It's the first new store from the ground up for Sears in recent memory. It's also not Sears' first attempt to sell major appliances in a stand-alone format – the company sold off the Sears Hometown unit in 2012 but retained a stake in the business.
Still, new stores will be a focus going forward, Sears chairman and CEO Eddie Lampert said during the company's annual shareholder meeting in Hoffman Estates, Illinois.
"I think we'll do more of those stores," he said, according to Crain's. "Stores in general aren't going away."
The store features digital signage to quickly change and match pricing, and a 122-inch digital display to help shoppers visualize how appliances will look inside their kitchen.
"We're using digital innovation and this new store space in a different way which will enable us to deliver a superior shopping experience to our members," said Leena Munjal, senior VP, customer experience and Integrated Retail, in a statement. "The store in Fort Collins is a great example of how we are focusing on our best categories, stores and members and how the right blend of a physical store with Sears' digital capabilities can deliver a fresh, innovative and convenient way for our members to shop."
But members aren't shopping at the levels Sears needs.
Lampert has championed and defended the Shop Your Way program for the five years since its inception, insisting that getting Sears' and Kmart's best customers to spend more is the future of the company.
Shop Your Way members sign up to get coupons and earn rewards. There's a social component to the program that lets them interact with other shoppers and review or recommend products. The intent is to get them more engaged with the brand, something that hasn't happened at the scale necessary.
Shop Your Way isn't going away, according to Lampert. Rather, Sears plans to double down on the program.
"Ultimately we need to make Shop Your Way better," he said. "Our reputation will change when we get (the Shop Your Way network) to matter."
Sears said in February it would accelerate the number of store closings and in April, announced the closure of 68 Kmart and 10 Sears stores this summer, including the company's oldest location.
- see this Sear's press release
- see this Crain's Chicago Business story (tiered subscription)
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