Kmart -- Soaring High Shoppertrak\'s National Retail

Kmart -- Soaring High

ShopperTrak's National Retail Sales Estimate (NRSE) reported that U.S. retail sales for the week ending April 23 increased 9.9% as compared to the same week last year. Although adverse weather throughout the Midwest led to a sharp 13.0% week-over- week decline, the Easter holiday calendar shift continued to positively impact the year-over-year retail comparison, posting one of the strongest yearly increases seen in 2005. (Vargas, 2005)

Retail industry in U.S. has seen profits soaring high for most of the big retailers like the Wal-mart and Home Depot. While the rich gets richer, the profit of some others has also shot high. One of such names is Kmart. Better customer care, good marketing strategies, reorganization, and now the acquisition of Sears Corp has helped it revive from its bankruptcy condition of 2002.

Kmart Holding Corporation and its subsidiaries (together, "Kmart") is a mass merchandising company that offers customers quality products through a portfolio of exclusive brands that include Thalia Sodi, Jaclyn Smith, Joe Boxer, Martha Stewart Everyday and Route 66.

Kmart Primary Industry - Pharmacy

Kmart has met with a lot of competition from Target and Wal-mart but has succeeded to remain as top retailer for pharmacy and health-care products. The discount retailer has pharmacies at 1,150 of its 1,429 stores. The chain maintained a commitment to the department with an increasing array of patient-care initiatives, a new pharmacy design, workplace upgrades, and a networked website allows its pharmacists to access patient records from any store.

Kmart's pharmacy section is an asset to the newly formed Sears Holding Corp. Their past two decades of expertise in disease management, automation, pharmacy workflow, and patient service will be a powerful asset. The Kmart Pharmacy Center Website allows Kmart Pharmacy patients to easily and conveniently request refills, new prescriptions, and prescription transfers. To transfer a prescription from a pharmacy other than Kmart, This website also provides "Wellness Information" which explains general principles for good health. One can request a different flavor using the Special Instructions to the Pharmacist on his/her Order form.

Over the past year, Kmart Pharmacy has taken disease-management initiatives, particularly in diabetes care. By the end of 2004, the chain had capped a massive effort to train and certify all 2,400 of its pharmacists in diabetes management and related product categories. Pharmacists were given additional training last year so as to how to boost sales and counsel patients in nutritional supplements. Kmart's divisional vice president of pharmacy, Mark Doerr, said the chain had built "a suite of [12-hour] certification programs" in diabetes and vitamin-based preventive therapy.

The pharmacy department in Kmart has been shifted near the entrance to give it ultimate importance. The new location is aimed at driving sales in some of the highest-margin categories, like generic drugs, vitamins and other drug store-related categories including greeting cards and cosmetics.

Recently, Kmart Holding Corp. moved certain nonprescription cold and allergy medicines behind pharmacy counters, and became the latest in a string of retailers to limit access to products whose ingredients can be used to make the illegal drug methamphetamine. (Kmart joins other retailers in limiting cold medicine access, 2005)

New Appointments

In order to focus on customer services and improve facilities in its stores, Kmart appointed Robert Norton as Senior Vice President, Stores, Dene Rogers as Senior Vice President, Store Operations, and David Whipple as Senior Vice President, Associate Resources in June 2004.

Mr. Aylwin Lewis was appointed President and Chief Executive Officer, in October 2004. Mr. Lewis also joined the Kmart Board of Directors. Mr. Lewis joined Kmart from YUM! Brands, Inc., where he was President, Chief Multi-Branding and Operating Officer.

Extended hours of operations

In November 2004, Kmart Holding Corporation helped shoppers get an early start with extended hours of operation on Thanksgiving Day from 7 a.m. until 9 p.m. Company executives and management personnel worked in stores throughout the metro Detroit area. Executives traveling outside of the Detroit-area for the holiday weekend visited Kmart stores in their respective communities. Executives assisted customers and associates by bagging merchandise, acting as greeters, retrieving carts and restocking shelves. Customers could also shop during extended hours from 6 a.m. until 11 p.m. Aylwin Lewis, Kmart President and CEO said, "What better place to experience the excitement of the holiday season than to directly serves our customers."

Keeping shipping costs fair

Kmart

Gives one a choice of four shipping services in most cases

Bases one's estimated charges on total weight, not number of items

Combine items based on size and shape to eliminate as much "dead weight" as possible

Kmart.com

Kmart.com provides competitive edge over others to its customers. It usually has more stock than its stores and the latest availability can be had from "new arrivals" or "this just in" throughout the Website as one shops. Kmart.com ranked at the top of the annual site design report from independent technology research firm Forrester, based in Cambridge, Massachusetts. The Kmart site ranked highest among those reviewed and was the only site to earn a passing grade. (Kmart, n.d.)

Kmart Rewards Credit Card

In order to retain and better serve the existing customers, Kmart Holding Corporation launched the Kmart Rewards credit card in November 2004. The new credit card program is being managed by HSBC - North America's retail services business. The Rewards card will provide valuable benefits and increased spending power both in Kmart stores and online, just in time for the holiday season. Kmart also develops numerous promotional offers for its cardholders tailored to their individual customer purchasing habits, providing additional benefits to membership. A more sophisticated approach to direct marketing will result from this intelligence and create a greater sense of loyalty among existing Kmart customers. This will help Kmart deliver excellent service to their customers and build brand loyalty through the benefits of this new card. The card, which has no annual fee, offers free online access.

An Innovative marketing campaign

Kmart Holding Corporation and E! Entertainment Television launched Attention®, a new apparel line available only at Kmart, and promote "E! News Live," the only live daily entertainment news telecast in August 2004. The partnership allows the major retailer and the top cable television network to jointly leverage their respective assets for mutually beneficial purposes.

Distinctive Competencies of Kmart

Today's successful retailers are constantly reinventing themselves to differentiate their stores from competitors. Retail competition has reached a new level where stores must constantly evaluate business models and consumer trends to attract and retain their customers. In April 2004, Kmart and Martha Stewart Everyday brand label entered into a long-term distribution contract. The revised agreement better aligned the two companies' mutual business interests by extending the Martha Stewart Everyday partnership two years, through 2009; expanding the scope to several new product categories including ready-to-assemble furniture; eliminating the product category minimum guarantee but not the aggregate minimum guarantee features of the contract; and making other adjustments that, taken as a whole, benefit both companies. Kmart sells Martha Stewart Everyday Home, Garden, Holiday, Colors, Kitchen, Keeping and Decorating, Candles, Baby, and accessory product lines. All collections, with the exception of Martha Stewart Everyday Colors, are available exclusively at Kmart and online at kmart.com.