Sears looks to external customer service programs to improve its sales, rather than updating its stores.
Sears has been suffering from declining sales for the last ten years. News reports show pictures of empty stores and poorly maintained displays. The company is trying to improve itself not through a new advertising campaign or rebranding, but by attempting to upgrade customer service and relations.
In May of 2013 Sears offered its customers a new service called Member Assist in which its shoppers can contact customer service representatives on line or by way of a phone app. The service is available to people who have already joined Sears’ Shop Your Way Program and it lets the consumer request to speak with a specific representative with whom they have already established a relationship.
Sears is now expanding that program with the new Get Advice that enables its members to contact not only customer service representatives, but also potentially millions of other Sears shoppers who they can ask for advice about different products. This will in effect be a message board where members will be able to post both their questions and give answers to other people’s questions.
Leena Munjal, a Sears senior vice president said, “We’re using technology to virtually open the doors to Sears stores across the country giving our members access to the expertise of thousands of our associates. This level of interaction is another way we are integrating the digital and physical shopping experience –members can enjoy the advantage of getting great advice from the stores plus engage the vast Shop Your Way community.”
Eddie Lampert, 51, is the controlling shareholder, chief executive officer and chairman of Sears Holding Corporation (SHLD), which includes the K Mart retail store chain. He engineered the merger of the two companies in 2005, when K Mart bought Sears for $12.3 billion. At the time the owners of the new company expected to be able to compete head to head with Wal-Mart.
A highly successful investor and hedge fund manager, Lampert graduated from Yale University and has an estimated net worth of $3.3 billion. Lampert is a self made man who Forbes magazine ranks as the 190th wealthiest American.
He founded and chairs the ESL hedge fund through which he purchased Sears. But Lampert has suffered financial losses as he attempted to personally underwrite the company’s debt. Last month he announced his decision to stop buying Sears Holdings’ IOUs after ESL had amassed some $285 million of its debt.
Sears has suffered 28 straight quarters of declining sales since ESL purchased it. Eddie Lampert has been personally buying up Sears Holdings stock while his ESL hedge fund has been selling its Sears stock.
According to Bloomberg, Sears currently has over $3.8 billion in outstanding debt. Because of the problems with Sears, ESL has been losing investors who Lampert had to pay off with Sears stock. As a result he no longer has majority control over the company and holds only %48 of its stock.
Sears is currently trading at $44 a share, down from $180 a share three years ago. Its executives are clearly relying on customer satisfaction and loyalty to turn things around.
“The Shop Your Way community is a resource unlike any other in retailing, ” said Eric Jaffe, senior vice president, Shop Your Way, Sears Holdings. “Get Advice and Member Assist are social commerce at its most powerful – access to trusted information, latest knowledge and valuable feedback on any of the millions of products members can find on ShopYourWay.com for sale by Sears and others.”
Sears hopes that this new service will also provide it with a wealth of market research as to what its customers want. It will still rely on social media, such as Facebook and Twitter, to maintain a connection with its patrons, but believes that Shop Your Way will be easier for them to use.