The Whiteboard: Death of a retailer was not inevitable
The announcement this July that Sears will be selling its Kenmore appliances though Amazon.com made me feel a little sad. The slow death march of a retail icon continues.
When I was growing up, Sears was Amazon.com, or at least the catalogue equivalent, and much more. You could order almost anything from the Sears catalogue. Not only that, you could go to the brick-and-mortar stores in every town and buy many of the same goods directly. You could even have people at the store help you order from the catalogue and then pick your items up at the store.
Sears' decline has been a long sad story of a company losing its mojo. Sears management was too slow or too incompetent to see and react to the threat to its catalog sales from upstarts like Amazon. But the catalog sales weren’t all there was to Sears' mojo.
Think about the brands Sears had in its portfolio. Craftsman was a tremendous brand built on great products at affordable prices. The hand tools were guaranteed for life. You could fill your automotive toolbox, your woodworking shop and the lawn-care corner in your garage with nothing but Craftsman products.
You could fill all your major appliance needs with Kenmore appliances. The quality was top-notch and the prices were competitive. Installation was professional and service was second to none.
Diehard was another great brand, the flagship product of the company's automotive products and service. Great products, strong warranty protection and affordable prices were all part of the mix.
Sears owned Lands' End, which had been a long-time competitor to LL Bean. Lands' End was another slipping catalog giant. It brought Sears apparel for all occasions with high quality and a consistent style.
That's a lot of mojo, but Sears somehow couldn’t come up with a strategy to put that mojo to work. Instead of capitalizing on its strong brands, Sears continued trying to be a full-line department store and website. It kept trying to be all things to all people, but in today's world, that is Amazon's game and it's a game Sears doesn’t know how to win.
So now the death march continues, a long march with no apparent object or strategy except raising cash to ward off the inevitable.
Stores in prime locations have been sold and leased back to raise cash. Now the company is paying rent for buildings it once owned. Other store locations have been closed and the employees laid off in a massive effort to stop the bleeding.
Lands' End was spun off in 2014 after the brand was almost destroyed under Sears' management. The Craftsman line was sold to Stanley Black and Decker in January of 2017. Two major components of the Sears mojo were gone with nothing but short-term cash to show for it.
Sears has been looking for ways to license or sell the Diehard and Kenmore brands for months, again to raise cash. In July, it announced the deal to distribute Kenmore through Amazon. This isn't a strategy; it is a slow-rolling fire sale. My money is on Amazon to purchase the Kenmore brand and its mojo outright for pennies on the dollar when Sears finally folds.
As business leaders, we have to understand our business's mojo and build strategies to evolve, helping those core products, services and brands to thrive as the world around us changes ever more quickly. It's sad to watch Sears die under leaders who have squandered its mojo and appear to have no other strategy.