Apparel will be a big focus for Kmart this back-to-school season. The retailer, a division of Sears Holdings Corp., is rolling out new collections such as Dream Out Loud by Selena Gomez, Bongo and Rebecca Bonbon. A recent survey by the National Retail Federation found that teens and tweens will shell out more of their own money for school apparel this year -- a timely trend for merchants like Kmart.
Still, consumers continue to focus on value, which is why Kmart is also offering a layaway plan and its "Shop Your Way Rewards" program, CMO Mark Snyder said.
In the following Q&A, Snyder, a former Holiday Inn marketing exec, discussed Kmart's back-to-school strategy.
Brandweek: What are Kmart's back-to-school plans this year?
Mark Snyder (pictured): You and I spent some time talking about Kmart Smart. That's our value proposition for Kmart, and one of those key pillars is our [offering of] unique brands. As we thought about back-to-school this year, [we came up with] a three-pronged strategy. The first involves "more fashion," and we've absolutely delivered on that.
In apparel, we've introduced three new brands. In addition to GLO [the Jones Apparel Group jeans and accessories line], there's also Dream Out Loud by Selena Gomez, Bongo and Rebecca Bonbon, which is a great character brand licensed from the same folks who developed Hello Kitty. They're all in stores for back-to-school and tweens have said they love the Bongo brand. We feel that we've delivered on the fashion and unique brand pillars for Kmart Smart.
The [second and third are] more value for the Kmart customer and more ways to shop. And that is defined beyond just what the price is. Our consumer isn't just looking for a cheap price. She wants quality that will last for the money that she is going to pay. She juggles those two things together. Convenience is also a big piece of the value equation. We are stepping up Kmart2go, a mobile application that allows you to go onto Kmart.com and order directly [from the site]. You can have items shipped to your local store and be able to put them on layaway or pay for them at that point. We can also text her with the deals of the day that we know will be relevant for her during [the back-to-school] buying season.
Any new campaigns you've rolled out for back-to-school season?
Kmart just launched the TV portion of the advertising. It's a great spot called "Confidence" [by agency Draftfcb, Chicago]. The insight there is that moms want their kids to do well in school. They know that if they feel confident about the way they look, that sort of takes that concern off the table and they can get to the business of concentrating on school. The insight we have from kids is that they want to be confident, look good and fit in -- and confidence is a big part of that. [One way Kmart is able to deliver on that is] the breadth of the brands we offer allows tweens to be able to express their individuality.
Are consumers still as price and value focused? How has the back-to-school retail landscape changed from last year?
Our customer recognizes her full power as a shopper She's very savvy about the way she spends. Her utilization of layaway is a good indication of the way she plans and funds her family's expectations. She is still interested in price and quality. If you lump all of that together, the value proposition comes down to whoever's [making] the sharpest point in the category is the one who is going to win.
[As for] the economic landscape, that is relatively the same. All of us were feeling a little encouraged towards the front of the year, around Easter time. But that enthusiasm has leveled out a bit. We are still very cautious in terms of how we [approach] the back-to-school year, but we're very confident in our value proposition, in terms of what we have to offer, in our unique brands, quality and price, but we feel confident about the season
If you had to name one successful marketing initiative Kmart's introduced to date, what would it be and why?
The "Shop Your Way Rewards" program -- I'm really excited about it. This was something we piloted in a number of Kmart stores last fall. The reaction was sensational. It's a loyalty program and it's really the first of its kind in the mass [retail] category. It allows our customers to build 10 points of equity for every dollar they spend. They opt-in through mobile devices or their e-mail address, which allows us to start a dialogue with them, to make offers to them that are relevant to the kinds of things they want to be able to purchase and want to see through Kmart. That engagement with customers allows us to create a different relationship that we were never able to have with them.