Marketing Theory Pt. 4

Question 3: In 1999, Sears launched a new online store. What effect did this move have on the company? Was the decision to move online to E-commerce the right one for Sears?

Sears’ had no choice but to adopt an e-commerce arm. With the well know demise of mall-based stores and the growth of both big box formats and e-tailing, to not make a move would have been suicide. Unfortunately, when we observe what happened to Sears immediately after 1999 (Figure 1, previous page) it becomes very difficult to say the decision was a good one. It seems that Sears’ management focused too much to the online implementation and suffered the consequences.

The following is a summary of a Stats Canada report issued March, 27, 2007: “Revenue at so-called brick-and-mortar stores, selling to walk-in customers at physical locations, grew 5.3 per cent [2005], while non-store retailers such as those selling exclusively through e-commerce, mail order or catalogues posted growth of 7.5 per cent.[1]” Sears has no choice but to keep up with retail trends; if they are going to keep their market share, they have to meet the customers’ demands. The decision was a good one but it is possible that the same management that is running the bricks and mortar unit into the ground is the same management operating or strongly influencing the clicks unit.