Lands’ End Finds a Fit In Sears Stores

Sears Holdings Corp. has taken a lot of heat during the past five years for the way it’s handled the integration of the Lands’ End apparel catalog brand. But the retailer may have found a strategy that works: the store-within-a-store.

After unveiling the concept in 2005, Sears aims to double the number of Lands’ End store-within-a-stores from 100 to 200 by the end of the current fiscal year. Sears won’t divulge sales figures, but the strategy is clearly working. In a March 1, 2007 letter to shareholders, Sears Chairman Edward S. Lampert said that the company “saw a significant improvement in the profit performance of Lands’ End merchandise in our Sears stores…”

The Lands’ End shops measure about 10,000 sq. ft. and use navy blue signs and columns to create a look distinct from the rest of Sears. The shops also have a lounge area with a couch and a computer kiosk for ordering over the Internet, with an offer of free home shipping if the item isn’t in the store. “The idea is to enhance the customer experience and make it easy for customers to shop for Lands’ End apparel coupled with the Lands’ End service model,” says Sears spokesman Christian Brathwaite. “We’ve seen a very positive customer response.”

Sears acquired Lands’ End in 2002 for $1.9 billion, and soon after the purchase began introducing Lands’ End merchandise to its stores. But many industry watchers criticize the way the brand was promoted and displayed in the department store locations. For instance, Lands’ End merchandise was spread throughout the Sears’ stores, making it more difficult to locate items.

Indeed, Brathwaite says the idea behind the store-within-a-store concept was to better present the Lands’ End brand.

Christopher T. Shannon, managing director at New York-based Berkery, Noyes & Co., says the store-within-a-store concept seems to be gaining in popularity, “with the rise in demand from the public for more specialty retailers. I believe the goal is to have more of a one-on-one relationship with the end-buyer and offer as many different ways to make a purchase as possible.”

Regarding Sears and Lands’ End, Shannon adds: “It helps them both. It helps Lands’ End sell more product through more exposure and helps Sears by adding another great brand in their stores in a creative way.”

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