New CEO Ronald Boire says Sears is here to stay. He is the newest member of 4 recent leaders in 3 years making a go at keeping Sears alive in Canada, our team chatted among ourselves as to how we might approach such a feat.

Growing up on the Canadian prairies, Sears Canada was a solid thread in the fabric of suppliers for all things home and garage, a virtual security blanket of where-to-get-what and all in one place.  Sears was the place my brothers bought decent tools and we could count on Sears to always be the same and carry the goods we wanted.  But in the competitive retail marketplace, a lot has changed, and a company that rarely changes will see themselves falling off the radar faster than you can say “rebrand me”.

Changing was once the name of the game for Sears (formerly Simpson-Sears) between 1953 and 1962, from mail order to retail stores they enjoyed a great deal of growth as they moved through building new credit systems and adopting new technologies.  They were a force to be reckoned with in the Canadian retail market.  Through to the late 70’s there were few Canadian children who didn’t wait at the door for the Christmas Wishbook to arrive. Nary was a ‘Santa list’ created without that prize catalog of toy-land-discovery being carefully perused and assessed.  So what happened from the mid-eighties until now to change the powerful force that Sears held on our Canadian Retail market?  The landscape changed, but did Sears fail to change with it?

Sitting in our offices today, a discussion ensued about the kind of changes needed for Ronald Boire to truly save Sears Canada, (and shift where necessary) to keep the icon relevant in Canadian Retail.

Where to Start

Building the plan will take an enormous strategic effort, and the planning and readiness through that strategy development is vital.  We cannot impress upon them more that the key to a successful change rests upon the importance in having the right data at hand before making major decisions.  What data?  Let’s start here:

1. Market Segmentation
2. Consumer Behaviour
3. Customer demographics
4. Multi-channel delivery
5. Corporate Partnerships
6. Industry & Marketing Trends
7. Consumer Engagement and Relationships
8. Customer Service
9. Identity
10. Internal Training Programs

In preparing through the readiness step, Sears Canada reports they have done much in the way of cutting costs, setting themselves up for being able to remain sustainable through a complete overhaul of how they do business, but there is still a long road ahead.  Each of the above areas must be analyzed by people who understand the data but more importantly, know how to align it.  Considering the whole host of micro data within each area above, it is important that Sears is willing to shift from the “it’s worked before” mentality to a “what does the data tell us, really” mentality.  And the decisions will need to take into serious consideration those managers and middle managers who must implement change.  Having the corporate focus on true data and stakeholder information, with means and measures of where and how to gather that data and the strength in understanding how to interpret it for the decision makers will make it much easier to evaluate.

Identity Crisis

Do you remember being a teenager and wondering where you fit, wanting to be part of several different groups, but never really feeling like you belong anywhere, you don’t know yourself well enough to self-define so you slide and hope someone picks you up?  It appears Sears Canada is in that same realm- floating to be defined but never really knowing themselves well enough to identify where they fit. As a teen must get to know themselves and the people and environment around them better to know who they are, Sears must do the same.  They require a solid understanding of the market, the consumer habits and behaviors, the industry trends and what customer engagement looks like in 2014 and to anticipate where it is going.  We are in a relationship market and customers want transparency, demand great customer service and want to engage quite literally with every online conversation, blog and write-up. If a business can’t clearly define their own identity, the right customers will not be correctly targeted.

The company is long overdue helping us understand who they are and where they fit within the Canadian marketplace.  Are they the middle ground between the low-cost Wal-Mart stores and the higher-end The Bay?  (Both of which have their own shifting to consider.)

A clear, desired state must first be defined – who they will be in the future and how that looks, feels and materializes is vital, they need to know where they fit in the Canadian Market and precisely who they are for their customers.  Then they need to clearly convey this message from Corporate through to consumer – simply, articulately and soon, so everyone “gets it”.  It is not enough to say they are in it for the long-run, they need to share the vision.

Technology

In 1959, Sears was instrumental in embracing new technologies by being a pioneer of the Telex Service providing improved international record keeping allowing them to increase their credit accounts by 190,000 within a single year.  Sears was rocketing by being technically savvy.

It’s fundamental to take a long hard look at technology and what exists in the current business, evaluating it against what will be needed to accommodate current consumer behaviour and trends and implementing the right strategies moving forward.  This is an expensive and important investment that cannot be taken lightly, a plan to ensure all technology is vetted through an overall big picture view rather than a “grasp at mini solutions” ad-hoc set of implementations is paramount.

Areas of technical evaluation to consider will be internal and external.  Data management & analysis, metrics tracking, sales and delivery tools, procurement and inventory systems will all need a solid review and update.  Externally, digital catalogs, mobile device applications, client engagement tools, and social media strategies.  All of these tools interconnect as a means and way of remaining relevant and top-of-mind to today’s consumers and the market Sears chooses to call their own. (See identity crisis above.)  Take Neiman Marcus, for example, they saw the benefit of teaming up with the company Slyce to connect people with their products, now that is making themselves relevant.

People

With all companies, a strong organizationally developed company can gradually slide when they are busy bailing the water out and trying to fix the leak.  A myopic view of business challenges can put the people in last place.  A once great management training program will need to change as Sears begins to change.  They have a pretty solid 18 month training program for their Management staff with a focus on Merchandising, Supply Chain, Marketing and Retail Operations as well as varied store visits and shadowing.  Kudos for Sears in building operational processes for management, but there are some key areas of leadership development, change management, leading employees, understanding new consumer trends, reaching the community and other programs we could not find when we did a little research on the company.  Their old standard of pop-up in store promotions just isn’t gathering the crowd like it used to.  If they have developed some current trends in these areas, it’s not obvious.  Shifting the company to a stronger growth-focused environment will require some key elements that support great leadership in addition to strong merchandising skills.  Knowing the consumer better, shifting with the consumer and being flexible in reach will help managers better know how to support their staff to sell.

Areas of focus for all change will need a full review of the HR policies, procedures, benefits, training, loyalty programs, incentives, support systems, customer service delivery, and sales practices.

Alliances

As with the Neiman Marcus and Slyce partnership, Sears is due for a relevance shift.  Partnering with companies that serve a broader reach and partnering with retail suppliers in unique ways to drive traffic and sales is long overdue.  Most of what our team has observed is that the catalog needs a full technical overhaul to make it easier to buy, flyer marketing needs to include a price because people no longer will go in-store to find that out, a great app for getting current deals is non-existent, and we see very little draw to engage with the consumer.

Take one small example from Costco, they may be a warehouse model where dozens of folks flock to their bricks and mortar to get product, but they also have a pretty solid online system.  We are not just talking about an online catalog, however, because members at Costco are provided with something relevant in the area of content management.  They ship a magazine/catalog that provides information useful to the consumer, something they can read and enjoy, something that gives them recipes, articles on travel, and more and their lives are enriched by the engagement.  Within this magazine are relevant products available at Costco.ca for anyone to purchase conveniently, and presented in bite-sized chunks made into a shopping experience.  Once on the website – their search engine and transparency are exceptional.  It pays to invest in your technology!

Conclusion

Times change, consumers change, and trends and technology drive those changes.  The organization that understands the change management process, that looks at the overall organizational development within their company, and who is exceptional at data collection, review and alignment is better prepared to change with the times and consumers.

Because of the very early beginnings of Simpsons and their merger with Sears, our whole team feels nostalgic about Sears and truly hope they make this fly.  Sears needs identity, relevance, reach and engagement to once again become a leader in the retail space in Canada, it will be interesting to see where they take it.

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