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How Sears is repositioning itself as a smart home tech hubBy
PALM DESERT, CA – A Sears Holdings executive at eTail West 2016 discussed how the retailer is foraying into sales of smart home devices by creating demand among homeowners unsure of how the products may benefit their lives.
During the keynote session, “Integrating Retail, Mobile, Ecommerce and Big Data: How Sears and Kmart Are Transforming Their Consumer Electronics Business Into Connected Solutions,” the executive highlighted Sears’ commitment to cementing its status as a market leader in the smart home technology sector. Although many smart home products contain relatively high price points, the retailer is developing ways to educate consumers on how these devices can augment their daily activities.
“In the next five years, there will be 20 billion connected devices,” said Kelly McGann, chief marketing officer of consumer electronics and connected solutions at Sears Holdings Corporation. “This is going to happen with or without Sears Holdings.
“The opportunity for us is to be a market leader in the space.”
Transforming consumer electronics
Sears is currently revamping its consumer electronics business model to focus more fully on selling connected experiences centered on smart technology. Smart home products are generally more complicated than their non-smart counterparts, as well as more expensive.
If Sears displays these items on a shelf next to their corresponding price points, consumers are reluctant to buy them.
“We need to help customers understand how these products can benefit their lives,” Ms. McGann said.
The retailer embarked on this journey approximately two years ago by rolling out three new pilot stores in the Chicago area, bearing the tagline “Get Connected, Stay Connected.”
For three-fourths of shoppers who stopped by, the store dramatically changed their perception of Sears and got them more accustomed to the idea of mobile-enabled smart home devices.
This helped Sears understand that it had to create a spike in demand for these products, rather than rely on the market to facilitate an uptick in sales.
Powering up demand
Sears marketed the smart home devices by deducing how various individuals could use the items to benefit their daily lives. For example, it discovered that consumers away from their homes have a high demand for checking on their pets at home.
Individuals with children may also be interested in a smart doorbell that enables the parents to unlock the front door if they happen not to be at home when their children arrive from school.
This prompted Sears to develop an empathy engine, which leverages in-store tablets to help shoppers discover which products are right for their homes.
Additionally, many of the retailer’s early adopters are online shoppers. Sears introduced an online compatibility platform that lets those individuals discover which items are compatible with the existing smart devices they already have in their homes.
Another marketing tool for the brand is the constant tech support that customers receive after purchasing a connected device.
Last November, Sears also pushed sales for home improvement and appliance services with a new dynamic Web site that emphasized mobile utility and supported the retailer’s reputation as a leader in this segment (see story).
“It’s not always easy to find products that work with the platform you’ve got at home,” Ms. McGann said.
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