Alexa Bergman Lucy Colgan Kyle Jensen Kelsey Kramer Julia
McClellan Kok Kit Sue Christopher Thomas
Slide 2
Agenda 2 History Current Big Picture Revised Big PictureFinal
Implications
Slide 3
History 3 Sebastian S. Kresge: invests in 5-and- Dime
convenience stores, called the S.S. Kresge Stores First official,
KMART store is opened in Garden City, Michigan S.S. Kresge
Corporation officially changes it name to the Kmart Corporation
Kmart Corporation files for bankruptcy Kmart merges with the Sears
Corporation in hopes to obtain the Sears customer base March 1 st
1962 1897 1977 2002 2005
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Current Big Picture Business Objective Marketing Objective
Source of Volume SegmentTargetProductPricePlacePromotionPositioning
4
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Fundamental Entity Kmart as distinct brand under Sears Holding
Corporation Discount Retail Space
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Core Competence Maintaining/establishing exclusive brands with
celebrities and designers Exclusive brands only sold at Kmart
Unique products that drive consumers to Kmart Goal: Provide
quality, discount products through its exclusive brands. Core
CompetenceStrategic AssetBenefit
Slide 7
Marketing Objective/Source of Volume 7 Acquisition MO Steal
Share SOV
Slide 8
Segmentation Demographics Females aged 28-49 years Emphasis on
Hispanic shoppers Attitudes & Behaviors Value low prices Engage
in discount shopping 8
Slide 9
Targeting Meet Maria, 28 Mother of 2 kids Lives in Raleigh, NC
Works at Department of Labor Discount shopper Interested in
cooking, spending time with her family, and maintaining a well-kept
home 9
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5-Box Positioning Statement 10 When I shop at discount retail
stores, I go to Walmart or Target Kmart stores are outdated and do
not fulfill my basic shopping needs Kmart offers exclusive brands
like Sofia Vergara to attract adults Kmart meets my shopping needs
and standards Kmart is my first choice discount retail store
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The 4 Ps Price Place Promotion Product 11
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Product Offering a wide range of goods in the discount retail
sector Introduction of Smart Sense line by offering quality
products that cost 20% lower on average Introduction of exclusive
brand lines, e.g. Bongo, Joe Boxer, and Sofia by Sofia Vergara
12
Slide 13
Price In discount retail market Offer low prices but not
guaranteed to be the lowest 13
Slide 14
Promotion Television Advertising
http://www.youtube.com/watch?v=sQTwtFUcGUg
http://www.youtube.com/watch?v=sQTwtFUcGUg Event and seasonally
driven advertisements Shopyourway.com Online reward/loyalty point
system In Store promotions through signs Promotes discounts,
layaway, distinct brands Weekly circulars 14
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Place Retail Locations currently 1,300 stores Warehouse of
plethora of products 3 sub-retail brands which each offer
additional products Kmart Big Kmart Super Kmart Online Options
English/Spanish Online Services, such as: Pick up in store,
MyGopher delivery service 15
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Our Kmart Adventure 16
Slide 17
Big Picture Problems Business Objective Marketing Objective
Source of Volume SegmentTargetProductPricePlacePromotionPositioning
17
Slide 18
Revised Business Objective 18 Skill at creating a fun, family
retail expeience Skill at creating a fun, family retail expeience A
family- friendly retail experience for all ages Core
CompetenceStrategic AssetBenefit Widest breadth of family-oriented
products Play spaces for Children
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Revised Target 19 JOHN CLARK DENICE CLARK Age: 42 Paramedic
Age: 37 Dental Hygienist Expecting a baby KATIE CLARK Age: 13 Loves
Katy Perry, to dance, trendy fashion GREG CLARK Age: 7 Loves
baseball, action figures, playing outside
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Revised Positioning 20 When I shop at discount retail stores, I
go to Walmart or Target Kmart stores are outdated and do not
fulfill my basic shopping needs At Kmart there is the widest
breadth of family products and experiences Kmart is a one-
stop-shop with products for my whole family Kmart is my first
choice discount retail store
Slide 21
Revised Place FOCUS: Retail stores that appeal to a FAMILY, FUN
experience EXECUTION: 1. Shut down current Kmart stores that are in
poor condition and decentralized areas 2. Renovate remaining stores
to appeal to Family and Fun - Ball Pit, Jungle Gym area - Music
Selection in fitting rooms - Tablet Kiosks in aisle 21
Slide 22
Sample Place 22
Slide 23
Revised Product FOCUS: Products that appeal to each member of
the family EXECUTION : 1. Expand Grocery department 2. Expand on
household appliances -utilize relationship with Sears 3. Further
develop apparel lines for babies, toddlers and juniors 4. Expand
toy and games department 23
Slide 24
Revised Promotion FOCUS: Promotions that market a FAMILY, FUN
experience EXECUTION: 1. Advertisements that demonstrate the new
dynamic variable 2. Move the weekly print circular to a digital
medium 3. Seasonal promotions for kids 24
Slide 25
Sample Promotion 25 Everything for the American
Slide 26
Summary Kmart was lacking a dynamic variable We recommend to:
Make dynamic variable a discount store that provides a family, fun
experience for shoppers Retarget to the family as a unit Renovate
locations to offer the family experience 26
Slide 27
Questions? Thank you!
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Discount Departmental 28
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Supercenters 29
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Supercenters 30
Slide 31
31 25-40: Department stores often target advertisement and
marketing toward this age group since they are more likely to have
growing children and families for which they need to purchase
merchandise. www.ibisworld.com
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32
Slide 33
Product Differentiation Private labels or exclusive brands
account for about 20.0% to 30.0% of store merchandise. 70.0% to
80.0% of merchandise is the same across most stores in this
industry. 33
Slide 34
Competitor Distinct Brands Walmart Great Value Super Target
Archer Farms C9 by Champion Circo Merona 34
Slide 35
Driving Factors in Retail 35 As shown in the following Figure,
young adults are considerably more likely to report shopping at
department stores and to do so frequently. The 25-34 segment is
clearly an especially important target for many department stores,
as many within this segment routinely shop within the channel.
Slide 36
In-Store Media 36 According to Mintels exclusive consumer
research, 43% of mass merchandiser shoppers stated that it is
extremely or very important to them that the retailers they
patronize provide ways for them to learn about new products and
other topics of interest. As such, the potential for this factor to
influence sales should not be overlooked mintel.com Of particular
importance is the ability of electronic media to communicate the
value of various products, thereby reducing the common fixation on
price. By educating customers about the value of quality products,
retailers can highlight store worth while reducing price
sensitivity. mintel.com
