New Sears Pins Hopes on Boomers Buying Appliances for Their Kids

(Bloomberg) -- Just like some millennials, the new Sears is counting on a hand from their parents.

Baby boomers are the ticket to luring in the coveted group of young consumers, who are currently in the process of starting households and loading up on appliances, beds and other staples, according to Peter Boutros, the company’s chief brand officer and president of Kenmore, DieHard and Craftsman.

“They are most familiar with Sears and most loyal to Sears,” Boutros said of the baby boomer generation in a phone interview. “The boomer group typically will help their young forming families with big-ticket items.”

Sears is starting to build out its new strategy after emerging from bankruptcy protection, which was the culmination of years of market-share erosion and billions in losses. Eddie Lampert stepped down as chief executive officer with the bankruptcy but remains in control of the now-private company following the $5.2 billion acquisition of 223 Sears and 202 Kmart stores with his ESL Investments hedge fund in February.

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The hard part will be winning over new shoppers after years of defections. And some of that will involve sales outside of Sears: The company is in talks with several parties to expand sales of its Kenmore appliance brand elsewhere. This follows a 2017 agreement to sell Kenmore appliances on Amazon.com Inc. in 2017. Sears is also expanding the brand into more categories such as kitchenware.

Following up on the Amazon move, Sears said Thursday that it’s expanding its line of Kenmore appliances with Amazon Dash Replenishment to some of its dishwashers, washers and driers -- an appeal to consumers who have signed up for subscription service.

The company will also open three test Home & Life stores in Alaska, Louisiana and Kansas that sell appliances and mattresses. The locations are only 10,000 to 15,000 square feet -- about the size of a Walgreens.

Boutros declined to talk about sales patterns, saying it’s too early.

“We have got good support from all our vendors. We are working through right now what those relationships look like,” he said. “All the significant vendors have actually said to me, they want to see the success of Kenmore and the success of Sears.”

While ESL has said the new company will have a “footprint of profitable retail stores,” there’s still no one in the CEO role, and the company has yet to demonstrate that it can reverse years of declining sales.

“We must regain our members’ and customers’ confidence in Sears and Kmart,” Boutros said. “There’s quite a number of hurdles that we’re addressing in parallel.”

To contact the reporter on this story: Lauren Coleman-Lochner in New York at llochner@bloomberg.net

To contact the editors responsible for this story: Rick Green at rgreen18@bloomberg.net, ;Anne Riley Moffat at ariley17@bloomberg.net, Jonathan Roeder, Nick Turner

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