Kmart is dialing up the value advertising this holiday season, and for good reason, too. In an uncertain economy, consumers aren’t expected to be Scrooges, exactly, but they are refraining from extraneous purchases and evaluating each dollar that they spend. In response, Kmart has introduced new exclusive brands such as Smart Sense—which consists of food and household products—as well as a new bed-and-bath line called Casa Cristina. In an interview, Kmart chief marketing officer Mark Snyder spoke about why the Sears Holdings unit is beefing up its store brands, why social media is a big part of its holiday ad strategy this year, how Kmart is extending Black Friday beyond a one-day shopping spree and how it’s using layaway to spur more holiday sales. Excerpts are below.
Brandweek: Give us a sneak peek of Kmart’s holiday advertising plans this year.
Mark Snyder: Our theme for Kmart for the holidays is “Live Your Christmas Story.” [Draftfcb, Chicago, handles.] What you will see are ads showing that the best way to celebrate Christmas is your way. That’s what our customers are telling us, that it doesn’t matter what everyone else’s idea of a great Christmas is. [They’re saying,] Christmas is a great holiday celebration and our way is the best way for our family. The ways that our consumers celebrate are different based on their families, culture and geography, but the reason why they celebrate is the same: the sharing, the togetherness and the giving.
BW: Television aside, are there any other ways you’re getting the word out?
MS: We have an interesting social media aspect for our “Live Your Christmas Story” campaign. Moms can go online and share what their Christmas story and favorite tradition are, and what their family does that is distinct and unique for the holidays…It’s part of our strategy to activate social media in a way that is part of the overall media plan, and that helps us engage with consumers at the same time. We’ve done social media in the past but expect to see more of it this year.
BW: What is your focus for the holidays this season?
MS: We want to continue to offer and build out our capabilities but give [our target customer] the option and flexibility she needs to give her family the kind of Christmas she wants. So, we’re continuing to offer layaway, which we made the centerpiece of our 2008 campaign. And that gives her the ability to be able to get the products that she wants for Christmas and put them on layaway for an eight-week period. Consumers also have the opportunity to extend it from eight to 12 weeks. And we recently [expanded layaway] to include big ticket items like a washer and a dryer, something that’s more expensive where you might appreciate having the extra time [on which] to make payments. Another capability that we introduced in 650 stores is the ability to buy online and pick up the products in store. Again, she sees something in the circular. Maybe she can’t run out to [buy] it, but can go online, get it and set it aside for the holidays.
BW: What retail strategies did you glean from last year’s holiday marketing, and what are you doing that’s different this year?
MS: One of the things we learned is that there is more to November than just Black Friday weekend. The three weeks leading up to it offer an opportunity for us to get a bigger piece of her mindshare and more of her visits. What we’ve done is take a concept called Better Than Black Friday that was popular last year and expanded it from two to three days. Essentially [consumers] are able to get seasonally relevant products at Black Friday—like prices for the three weekends leading up to Black Friday and the three weekends after it. Again, what we learned was that she is very responsive to these types of promotional events. It’s a way we can build out [a concept like this] and make it stronger. This year’s Better Than Black Friday events will also include an increased rewards component. So, if you are a Shop Your Way Rewards Program member, you’ll get two times the rewards instead of one. It’s a deal, and you can get high quality products at great value.
BW: Why the increased focus on private label? Has Kmart traditionally been active on this front?
MS: We’ve always had a strong presence in private label in our apparel lines—in women’s and kids, especially. [Jaclyn Smith, Joe Boxer, Route 66 and Country Living are some of the retailer’s exclusive brands.] What we’ve looked at is the consumer’s interest in being able to get more value—and yet, still high quality—out of [common, everyday] products like food and consumables and also in things that they use around the house. That was an opportunity to build out what we have. And private label done right—with the right price point and the right quality—can be a great way to build out your value proposition and add some difference to the customer experience that your competitors can’t.
BW: What are your top picks from some of the new products in the Smart Sense line?
MS: Definitely the trail mix. Also, in the first couple of rounds, the butter profile in the butter popcorn was not high enough. (We went and got that feedback from team members.) We’ve also gotten a lot of compliments on our flavored water. It’s great tasting and has zero calories.