Kmart Continues To Reduce Advertising

NEW YORK–Kmart chairman and CEO Chuck Conaway told analysts Thursday that the company is continuing to reduce its reliance on advertising.

The strategy, revealed during the company’s second-quarter conference call, is part of a move to strengthen financial performance of the $40 billion Troy-based discount store. Kmart reduced Sunday circular advertising by 75 pages during the quarter. Direct mail pieces were reduced by 64 million pieces nationally. Those actions resulted in a $25 million reduction in advertising costs for the quarter and a $70 million reduction year-to-date, said Kmart spokesman Jack Ferry in a separate interview after the conference call.

Kmart will focus more on in-store advertising. Other cost-saving actions include closing under-performing Kmart and Kmart Supercenter stores, accelerating inventory reductions and redefining information technology strategy.

Kmart posted a smaller loss than in the year-ago quarter. The company lost $95 million, or 19 cents per share in the period ending Aug. 1 versus a $448 million, or 93 cents per share loss, for the same period last year. Sales fell 1 percent to $8.91 million from $8.99 billion in the year-ago quarter.