Sears plugs into all forms of electronic retailing

Sears Plugs into All Forms of Electronic Retailing

CHICAGO -- Sears has made the greatest commitment to electronic retailing of any merchant, actively participating in the various formats now being shopped by consumers.

This effort encompasses: partial ownership of PRODIGY, the interactive computer shopping and information service; launching Gift Sender, an interactive shopping kiosk that sells non-Sears goods; providing its own merchandise for sale on QVC, the passive teleshopping service; directly merchandising its goods on PRODIGY and two interactive cable TV teleshopping services, Telaction and Main Street; and marketing Gift Sender goods on Telaction.

The retailer also has tested in-store kiosk merchandise information centers that feature a broader assortment of goods in a category than is actually stocked in the unit. Shoppers obtain product information on each item in the expanded assortment and can order goods through the kiosk's phone, which is connected to the local Sears catalog center.

Sears' interest in the various electronic retailing formats is twofold. Its core concern is to become familiar with any marketing method that could become an important form of retailing in the future. The immediate goal is to reach those higher-income and time-short individuals and families who don't usually shop at Sears but are buying merchandise through any of the electronic retailing systems.

For the most part, Sears electronic retailing ventures fall under the company's catalog and direct marketing division. That division selects the merchandise, processes orders and handles fulfillment. Sears doesn't break out its electronic retailing revenues.

Sears is exploring a number of merchandising options through its electronic retailing ventures, targeting specific probes to the unique features of each format.

With PRODIGY, its joint venture with IBM, Sears is attempting to connect with the future, the 1990s and beyond when home computers are expected to become a common household appliance and families will use the device for a host of everyday applications, including shopping.

But Sears involvement is very realistic. It uses PRODIGY to merchandise goods from its catalogs and to enable consumers to shop its books at home. This marketing recognizes that computer selling right now is the high-tech alternative to catalogs, rather than a substitute for traditional store shopping.

Sears programs on teleshopping networks Telaction and Main Street are an attempt to reach the growing number of homes with cable TV using interactive technology. The retailer features merchandise from its catalogs, along with the means to order goods from the books, on the two services. Telaction reaches about 30,000 households in the Chicago area, but plans a national rollout next year while Main Street is being tested in Newton, Mass.

The retailer's probe in the passive teleshopping field is more circumscribed as other electronic retailers already hold the franchise to merchandise on the various cable TV systems. Sears' effort is limited to offering both current and discontinued merchandise exclusively to QVC, with that teleretailer's merchandisers selecting the specific items to be presented to viewers. Sears goods accounted for about 10 percent of QVC's $193 million in sales last year.

Gift Sender probes another marketing option, testing the sale of goods in an environment that is completely divorced from any identification with Sears. The kiosks don't carry the Sears logo and the merchandise--gift items like jewelry, personal care products and floral commodities--is all non-Sears goods. Sears spotted a dozen Gift Senders throughout Chicago and plans to expand the network.

Sears uses an outside fulfillment service to process orders. The service maintains a real-time database of available merchandise, so that if an item is out of stock, the product isn't displayed to buyers during a shopping session.

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