Retail Hopes for Happy Ending

CHICAGO It’s been a tough year for American consumers. Hurricanes, an ongoing war and a softening economy are all adding up to what could be a difficult holiday season for retailers. But tough doesn’t stop the calendar, and retailers are already unwrapping their holiday campaigns, a couple weeks before the traditional holiday shopping season starts.

Retailing behemoth Wal-Mart, for instance, broke its earliest holiday effort ever on Nov. 1. Sears, Roebuck and Co. is launching its holiday campaign this week, beginning with a spot on last night’s Extreme Makeover: Home Edition on ABC. But Sears’ sibling company, Kmart, is launching its holiday campaign on Nov. 14, which is no change from last year’s timing.

“We’re starting in about a week to air them,” said Tim Mellors, North American chief creative officer for Kmart agency Grey Worldwide. “And that’s about on track with what Kmart normally does for Christmas. Their policy is to get in pretty early anyway. I don’t think anything’s changed from what’s normal for them.”

In its holiday outlook, the National Retail Federation said it expected total holiday sales to increase 5 percent over last year, to about $435 billion, due in part to effects of Hurricane Katrina and increasing energy prices. (In 2004, sales rose nearly 7 percent over the previous year to $415 billion.) The federation estimated one-fifth of the industry’s sales come during the holiday season, making it the most important time of the year for retailers.

The approaches the retailers are taking to reach consumers are a bit varied, too. Kmart will take a price-focused approach, using its tagline, “Everything on your list,” said Mellors. Meanwhile, Wal-Mart, RadioShack and, to a lesser extent, Sears are taking different approaches to using celebrities in their spots.

Wal-Mart, which had traditionally used regular shoppers talking about the value of shopping at its stores, has instead enlisted celebrities—its first time doing so—for this year’s holiday campaign from independent agency Bernstein-Rein in Kansas City, Mo. Television ads, which will air on national broadcast and cable networks, depict celebrities such as Garth Brooks and Queen Latifah celebrating the holidays in their homes.

One spot shows the members of Destiny’s Child and their presumed families gathered in a festively decorated living room. During the spot, they pass out presents ranging from electronics to toys. “It’s been a long year, and a lot has happened,” begins the accompanying jingle. The spot concludes with the line, “Hook up your home for the holidays.”

“This [holiday] season is coming in a year that’s been difficult for a lot of people,” said Wal-Mart rep Gail Lavielle. “We wanted to do something that would be perceived as sensational.”

The company also started its holiday-season advertising unusually early this year in an attempt to capitalize on the holidays, which she said “are [already] under way by the time you get to Thanksgiving,” the traditional start of the holiday season. Lavielle would not disclose spending, but the Bentonville, Ark., company has spent more than $100 million on advertising during November and December for the past three years, according to Nielsen Monitor-Plus.

While Wal-Mart is attempting to reach consumers through celebrity, RadioShack is taking the opposite approach. In the company’s first work since moving its $250 million account to Havas’ Arnold in Boston earlier this year, the company has eliminated celebrity spokespeople like Teri Hatcher, Howie Long and Ving Rhames in favor of a comfy red chair where people sit and talk about the gifts they’d like. The work carries the theme: “This holiday, don’t just get a gift. Get the right gift at RadioShack.”

“We want to entertain [consumers] and make RadioShack relevant and exciting again for people to shop at,” said Kieran Hannon, vp, marketing and brand communications for RadioShack, Fort Worth, Texas. “We have high awareness, but not high relevance. People don’t realize the depth and breadth of products we have.”

In one TV ad, an elderly woman says, “Honey. It’s Rose. On the TV. Listen. Go to RadioShack and get me this digital camera. It comes in a kit with a photo printer, glossy paper, a camera case and what else?” She loses her train of thought and begins to walk away. “Anyway that’s what I want,” she continues. A man takes the seat and begins to talk, but Rose abruptly returns and says, “A memory card. That’s it.”

Sears, too, is eschewing its celebrity spokesman, Home Makeover star Ty Pennington, in its holiday ads, according to sources. But not altogether, the sources added—it’s possible Pennington will appear in other ventures, like live events.

—with Kathleen Sampey