Offering some relief to recession-stricken consumers, Sears Holding Corp. this week announced a buyer protection plan that allows customers to keep their LG, GE or Kenmore appliance in the event of a job loss. Kevin Brown, vp and CMO for Sears Holding’s home appliance division, said the company will test out the offer (running through Aug. 1) on his department first, possibly extending it to other merchandise categories. Brown said the idea stemmed from consumer anxiety over making big-ticket purchases in a recession. Additionally, the retailer this week will kick off a Fourth of July sale, offering up to 37 percent off select appliances. Brown discussed these and other initiatives with Brandweek, and why it's the right time to market to consumers. That conversation is below:


Brandweek: Tell us about this new Fourth of July sale Sears is launching?
Kevin Brown: We’re offering some great deals on 3 or 4 [appliance] pairs. We used digital [to get the word out] about this particular event. We had a presale where we primarily connect with [our best customers] through e-mail. What we made available was a certain amount of inventory in advance. The key thing was, our best customers got advance notice of the sale and they had an easy way to go right from their e-mail to a private landing page that only they could access and see in advance of the general market.

The pre-sale started Sunday (June 29) and ran through yesterday. Today, we’re opening it online to the general public a day in advance, but the four-day sale for Fourth of July runs tomorrow through Monday (July 6).

BW: How is this different from the first time Sears ran the promotion, which was last year?
KB: The main difference revolves around our best customers still getting the advance notice . . . but we’re using our online capability to communicate [the effort] with consumers. That’s different than what we’ve done before. This isn’t the normal Sunday circular [push].

BW: Sears this week announced its “buyer protection” program, which both credits and lets a consumer keep an appliance purchase should unemployment strike. Where did the idea for this originate? (Hyundai, for instance, has its “Assurance” program, which offers to buy back consumers’ cars should they lose their jobs.)
KB: We put it together with our customers in mind. We have a lot of customer panels and research tells us that right now, the consumer is asking for value. If we continue to put these innovative and value offers in front of them, then I think the customer can go ahead and [buy] from us, versus shopping at the other guys.

We’re very excited about Sears’ buyer protection program. It’s the first and only program among any of the nation’s appliance retailers. It really came from listening to our customers, who have been telling us that despite the fact that Sears offers a lowest price guaranteed, despite the fact that we carry all the top brands—LG, Samsung, GE and our No. 1 brand, Kenmore—we still have consumers worrying about their jobs and the economy in general. They’re deferring much-needed appliances and bigger ticket purchases. We’re responding to that and coming up with programs to give the consumer [reasons to buy now]. If something does happen in the future, the program goes ahead and credits their account for the monthly payment and if they’ve not found work by 12 months, it will go ahead and take care of what’s left of the balance and the appliance is theirs to keep.



BW: How are you getting the word out about this? How do consumers sign up?
KB: We tried to make it very easy. The program is free. The only thing we require is that the appliance purchase is $399 and up and that you put it on your Sears card. Other than that, you are automatically enrolled in the program. It starts July 6 through August 1 for the initial period and we’ll evaluate results [before deciding] if we’ll continue it or not. Right now, it’s only offered on home appliances, but there is a possibility we may extend it.

You’ll see a fully integrated campaign breaking on July 5. There will be TV, radio, of course print circulars and online [components]. And, of course, our Blue Appliance Crew experts in the store. If consumers are interested, there are people in the store right now who can help educate them about the program. We’ll also have the site, Searsbuyerprotection.com, go live on July 6.

BW: Can you share any elements of the campaign?
KB: It’s all within the brand positioning of the Blue Appliance Crew, which is around the pillars we stand for: service, price and selection. The whole campaign is not going to be a departure from the Blue Appliance Crew spots, and the ad you’ll see is going to be within the same campaign. We’ll be talking about different capabilities and offerings.

BW: Do you think there’s still demand for large appliance purchases in tough times?
KB: Our appliance business has grown market share consecutively over the last four quarters…It’s one of the early indicators we were onto something [and why] we developed programs like Sears’ buyer protection program.

BW: Sears’s same store sales dropped 11.7 percent in its latest quarter. (Sibling brand K-mart fell 2.1 percent.) What’s your strategy for driving sales in tough times?
KB: The big strategy is the established strategy we have with consumers, which is really about continuing to activate the Blue Appliance Crew in market, and the focus of those commercials and our 360-degree ad campaign, has been talking about our distinguishing capabilities. [For instance], we are the only ones [at least to that extent] who run an appliance price check where we’ll guarantee we have the lowest price so you don’t have to leave the store feeling like you have to go someplace else or have buyer’s remorse. We are the only ones who offer a 12-month, no payments, no interest on everyday [appliances]. You need those payment options so you don’t have to wait till we run a finance promotion to buy it. [That offer] is available every day. We’re the only ones who carry the top ten [appliance] brands. That’s what we’re doing and that’s what we’ll continue to do.

BW: What other value programs are you pushing in the near future?
KB: Energy star appliances. Kenmore is our No. 1 brand of Energy Star appliances. In August, you’ll see us communicating around more green tips and encouraging people to make decisions that are not only good for their wallets, but good for the environment as well.

Customers might think, “Oh my gosh. I have to spend [X number of dollars] on an appliance?” What they’re not realizing is, if you buy a Kenmore appliance, let’s say a washer, over the [course of the product’s life], say, 7 to 10 years, you’ll save enough to pay for the dryer. We’re educating consumers on [the benefits] of putting out so much cash today so you’re making an investment in your home and your family, and you should have the confidence to do it now, especially with Sears, because we’ve got this great program.