Sears Adopts Its Own Blue Light Special as Retailing Distinctions Fade

Last Updated Sep 8, 2009 7:43 PM EDT

Sears and Kmart are getting more alike all the time.

Sears has begun running hourly promotions in its stores, reminiscent of the Blue Light Specials that Kmart ran for years in an iconic marketing approach it has tried to revive with limited success.

Announced in an email blast from Sears, the 1 Hour Specials were an important element in the company's Labor Day weekend promotional strategy and provided New Offers Every Hour, the content promised, but were strictly In-Store Only. However, they weren't new for the holiday.

Sears Holding spokesman Tom Aiello told Bnet:

Sears has been running these one-hours specials for a little over a month. They are being kept up because of the strong customer response we've received behind these onw-hour specials. Customers like the values and the increased fun and excitement of shopping. They are announced in store over the PA ever hour and run for one hour. They are similar to Blue Light specials but specific to the categories available at Sears.
Over the past couple of years, Sears has adopted a layaway program Kmart began successfully employing in the last holiday season, and it continues to experiment with ways to add food as in the case of its MyGofer internet showroom test, even as it has pushed Internet promotions after an initial positive response to a movie/Father's Day Kmart deal ran a little more than a year ago. Sears seems to be moving more in a discount store direction in terms of its positioning just as J.C. Penney is moving more in the department store direction with initiatives such as its opening on Herald Square in Manhattan and its incorporation of designer events for product lines including I Heart Ronson. In fact the segment of the market extending from department to discount stores seems to be getting more muddled all the time as a hierarchy from Macy's through J.C.Penney, Sears and Target breaks down. Macy's recall has added Martha Stewart and used other celebrity stylists in its apparel lines, adopting discount store tactics, even as Target has latched onto former darling of the department store Anna Sui for a second handbag line.

How this plays out will be interesting, particularly if you further consider that among all those retailers, Kohl's has been posting relatively good numbers in the recession, and it's the one that long ago cast off sector segmentation by combining discount and department store practices. For example, it has long carried labels found in department stores but also operated a bank of checkouts at the front of the sales floor a la discount stores.

In the meantime, Sears Holding chairman Edward Lampert is making waves again, characterizing an analysis of the company's financial condition by writer Jonathan Laing as "inaccurate" in a letter to his employer, Barron's. The report was contained in the publication's Aug. 24 edition and suggested that Sears stock could fall 50 percent after extreme cost-cutting depleted its ability to generate free cash flow it could use to win back market share from rivals.

While you have to give Sears the credit for trying new things, it has been a lot more interested in paying down debt that it has been in investing in truly major new initiatives. Lampert's plan may be to save money, trade ideas as they develop at Sears and Kmart, and wait out the recession before making a commitment of funds, that is if the money doesn't, as Laing suggests, dry up. Yet, while Sears Holding store concepts become less distinct within the company context, its competitors are reconsidering their own increasingly overlapping identities. Maybe Lampert is convinced that enough of his competitors will lose touch with their traditional customers for his company to use the tactical approaches it has been developing to claw back into the market on the cheap.