Is something a “failure” if other successes come from it?

“One thing is clear,” says the 14,297-word story in Crain’s Chicago Business, “Sears can’t survive unless it becomes a different company. From the start, Sears has been a merchandise-driven company, selling what it thought consumers wanted to buy. Now, it must become a market-driven company – one that asks consumers what they want, and gives it to them.”

That sounds familiar, but a lot of the story – like its discussion of retailers Sears should mimic – sounds like a different century.

“Montgomery Ward & Co. has transformed itself into a tight network of value-driven specialty stores… In electronics, superstores such as Highland in the Midwest and Circuit City in the South run circles around Sears.”

In fact, the Crain’s story is from a different century – the summer of 1988, back when Sears and Kmart carried dozens of Sony Walkman-type radios and thousands of different cassettes to play on them.

Both technologies evolved or left our shelves decades ago. Many of our competitors who made big changes and supposedly were better prepared for the future aren’t around anymore either.

Montgomery Ward was liquidated in 2001. Highland was second only to Circuit City in selling electronics when it went public in 1985. Highland closed in 1993. Despite massive capital investments and luxurious listening rooms the last Circuit City shut its doors in 2009.

What happened?

Change means more than just drawing up a plan and implementing it. Transformation means constantly measuring and readjusting in an effort to see if your underlying assumptions were right, to see if your ideas work, to see if there is a better way to serve your customers. You have to expand what works and stop what doesn’t.

If fixing retail were as simple as putting money into stores, Borders’ brass railings would still be shining instead of having been sold off for scrap.

Amazon’s successes are built on their willingness to adapt or abandon innovations like zShops and Amazon Auctions that didn’t turn out as well as they first anticipated. Target has experimented with and abandoned a variety of store formats – Everyday Hero, Smarts and Greatland – and Target itself began as a very small subsidiary that represented only a fraction of the larger Dayton Hudson company’s sales, but eventually took over both in terms of sales and name.

Retail is a volatile business and most retailers who have been successful have had all kinds of starts and stops – and all kinds of experiments. We learn from successes and failures.

As I told the Wall Street Journal back in January when the reporter first interviewed me for today’s article, that’s what we tried to do with the mygofer pilot store in Joliet – try out new ways to serve our members with faster service and a different store set-up that reflected how people shopped online. We were far ahead of the industry in a lot of ways. We learned a lot. We improved the integrated retail systems that pre-existed this experiment, and many of the adaptations we figured out underpin our Shop Your Way and Integrated Retail offerings today.

The mygofer store in Joliet closed, but across the country our members are using the Shop Your Way app that grew from the learnings there to let us deliver items directly to their cars. This year, we expanded it to allow members to make returns and exchanges from their cars within 5 minutes or less across our entire store base – an industry first on this scale.

We also took what we learned in Joliet and expanded our ability to offer buy online pick up in store from all Sears stores to nearly all of our Kmart stores, while also improving our ship-from-store capabilities. Our Shop Your Way Max two-day shipping program was made possible after a logistics team studied the warehouse management system at Joliet and used what we learned there to enable faster delivery to our members.

Success takes both hard work and a willingness to keep what works and adjust what doesn’t based upon what our members want. This is what we and our competitors needed to do back in 1988. It’s what so many people across our company are doing today, and it’s how we are going to bring Sears and Kmart forward into tomorrow.


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