Kmart Tries Again With Blue Light

HOFFMAN ESTATES, Ill. – Kmart, a unit of Sears Holdings, has struggled for the last two decades. In the last two years, management has tried to give the brand focus, all the while suffering from old stores and less viable locations. This month, more bad news came as more store closings are announced and Christmas sales are down.

But the chain is still optimistic.

At the end of 2015, they debuted new promotion that’s pretty old; the Blue Light Special. Kmart was known for the specials in pop culture, though it has been years since they were actually used. The idea was simple; there would be a short term bargain offered by management, and when it was, the manager would turn on the blue light and store goers would rush to the bargain to buy it, but only while the blue light was flashing.

The blue light became a part of American culture, just as Kmart became a symbol for tackiness. The roots of the problem at Kmart began in the 1970s. Even then, as they expanded, they had a closed universe of store branded merchandise. Almost anything you bought at a Kmart was branded with its own store brands, all under the banner of the slogan “Your Savings Place.”

Many feel nostalgic about Kmart; I am not one of them. Through the 1970s, their clothing was horrible and they became synonymous with tackiness and polyester, and they were extremely unfashionable. But the chain rallied, adding exclusive lines and changing up the product mix. The turquoise color, so synonymous with the tackiness, disappeared, in favor of a red K, and Martha Stewart eventually arrived, giving the tawdry company some sort of cachet. At a certain point, I remember reading about Martha visiting stores and reorganizing display racks.

Through the years, the brand got itself confused, and there became many different formats. Indeed the early strength of Kmart had been that every store was just about the same, and merchandise was, even if appalling or boring, well priced and practical and well made. After all, and for the discount customer, a cheap new tire was still a new tire, and a cheap clock radio was still a clock radio, even if you had to look at the dreary Kmart logo every time you woke up, the logo telling you, over and over again, “I am a cheapskate and I couldn’t plunk down $10 bucks more for a Sony Dream Machine.”

The chain went bankrupt in 2002; that it actually survives today is a miracle. At the time of its bankruptcy, it had moved far away from its philosophy of savings. I can recall going to the Kmart in Richmond, Virginia and having numerous prices far higher at the register than they were marked on the stalls. It was laziness, of course, but when habits like that become institutionalized, they become corrupt, and they more than deserved that fate.

With Kmart’s merger with Sears, they have been trying, closing unprofitable stores and painting and updating. In spite of the apparent and seeming hopelessness of the cause, I am regularly surprised and how much work the everyday employees are putting into the stores.

At a recent visit to their store in Ellenton, Florida, it actually looked decent. While some of the side shelves were empty, the floors were glossy, the clerks busy and the customers still shopping. The central aisle, so often cluttered with manufacturer displays, was actually cleared out, giving the store a bright appearance. Lines like Jacklyn Smith were well displayed, and two Kenmore washers were displayed up front.

On the door was a promotion for blue lights, and inside was the actual blue light display. Both are pictured below.

In previous visits last fall, I have seen people painting the front, re-merchandising the garden section and actually being attentive in the electronics section. The store in Ellenton is actually busy; the shopping center has been revamped and a new Chili’s added up front. If all the stores were run this way, the chain might have a chance, especially as the demographics of the area are perfect for Kmart. Many of the nearby residents are middle income retirees who would have to drive miles down the road for a Walmart. In comparison to the Walmart, you can get in and out of the store quickly.

Oddly, many Walmarts, as I see them, have become very dirty, not only in the people who shop there, but in the condition of the parking lots and displays. Kmart now clean? Could it be that Walmart is now more downscale than Kmart? Of course, Walmart is suffering for their inattention, and are closing hundreds of stores.

Corporately, however, it does not look good for Kmart, a unit of Sears Holdings. The stock, which was almost $200 a share in 2007, is down to less than $20. It is hard to see how the Sears/Kmart story ends, as the chain has been accused of using up its assets as it tries to survive. When the stock was at that high price, I wondered how any rational investor could buy the stock, and then walk into one of the stores, and see the value.

Last year, I recall going into the store to return some sort of electronics cable. The college-aged clerk at the returns area was enthusiastic, clean cut and in the process of getting his MBA. It was weird, and I was thinking something like “haven’t you heard that this company is a piece of archaeology.”

This return of the Blue Light is not the first time Kmart has tried to go back to its roots; a few years ago they brought back the blue light man as a sort of icon. It was unsuccessful, as it had no connection to actual lower prices.

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