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BRAND EXTENSION


BRAND BACKGROUND -

Sears Proprietary Brand since 1927 Lawn and Garden since 1948 Other brands- Kenmore, DieHard, Lands' End Merged with Kmart in 2005 Relationships with NASCAR & DIY Network


BRAND ARCHITECTURE SEARS

KENMORE

TOOLS

CRAFTSMAN LAWN & GARDEN

DIEHARD

GEAR

LANDS’ END


TOOLS & EQUIPMENT


GEAR

LAWN & GARDEN


CURRENT PROBLEM "Today, the Craftsman Brand is a de-focused warranty, price point, and quality-level nightmare...What's a Craftsman? An expensive, cheap, lifetime-not lifetime warranty, hand-tool, garage door opener, garden tractor, vice, toolbox, and now gadget making Brand." -Studio X-Temporal, Global Brand Consulting


CONSIDERATIONS -

Other Sears Brands Tools & Equipment vs. Lawn & Garden Future of the industry


GOAL

Refocus the Craftsman brand and position it to take a leadership role in the Home & Garden industry.


INDUSTRY -

Green building sector outperforming overall building and home improvement markets

-

Increasing government regulations and incentives continue to be a major driver

-

Greater consumer awareness of green building and desire to reduce energy costs


INDUSTRY Green Homes Built in the US 60,000 45,000 30,000 15,000 0 2000

2004

2008

* National Association of Home Builders


COMPOSTING -

Situated between Lawn & Garden and sustainable products

-

Not jumping into housing market Many practical uses A gardening tool


ECO-QUIPMENT SEARS

KENMORE

TOOLS

CRAFTSMAN LAWN & GARDEN

DIEHARD

GEAR

LANDS’ END

ECO-QUIPMENT


ECO-QUIPMENT SEARS

KENMORE

TOOLS

CRAFTSMAN LAWN & GARDEN

DIEHARD

GEAR

LANDS’ END

ECO-QUIPMENT


BRAND VISION -

Entering sustainability segment Opportunity for product line extension Creating new segment


BRAND VISION -

Message Current Positioning Future Promise Core value


PRIMARY TARGET -

AGE: 45-64

-

TARGET SIZE: 21.2 million people

Own Craftsman Lawn & Garden tools AND agree with at least two of the following statements: I make a conscious effort to recycle. Packaging for products should be recycled. People have a duty to recycle.

-

175% more likely than general pop to have purchased hardware/ home improvement items at Sears in last 3 months


SECONDARY TARGET -

Growing trend Younger, ethnically diverse Pull into Sears Lack loyalty to specific channel


ENTHUSIASTS I attend every lawn and garden show that I can I am a member of a lawn/gardening club I regularly read lawn and gardening websites and magazines I am a member of an online lawn/gardening chat site or forum I am passionate about tending my lawn and garden


ENTHUSIASTS -

Environmental concerns Cost-effective Spend more on products Willing to shop at Sears


PACKAGING

RETAIL PRICE: $200


GETTING IT OFF SHELVES -

Boomers: in-store communications Younger: online presence Optimistic, health-focused messaging


IN SEARS STORES -

Educational materials Displayed in current Lawn & Garden section Floor model Employee sales training


ONLINE -

Purchasing option, FREE SHIPPING! How-to guides Gardening information and advice Composting FAQs Other services: clubs, forums, etc.


ADDED BRAND VALUE ECO-QUIPMENT Flexibility Unity

Credibility Quality


THE NUMBERS # of People % Spending > $300/yr Population 58% of Hobbyists are Eco-Gardners 4,180,640 0.2 836,128 57% of Enthusiasts are Eco-Gardners 3,323,100 0.4 1,329,240 Total % of Pop purchases # of People Probability Number 10% 216,537 0.45 97,442 20% 433,074 0.3 129,922 30% 649,610 0.12 77,953 40% 866,147 0.08 69,292 50% 1,082,684 0.05 54,134 Total 428,743 Average

85,749

#Units Sold X Cont/Unit #Units Sold X Margin/Unit

7,803,159 9,346,594

Difference

1,543,435

ROI

0.20

2,165,368 Variable Costs Plastic Promo/Advert Miscellaneous Green Giving

46 3,944,434 12 1,028,983 20 1,714,971 10 857,486

Fixed Costs General and Admin Depreciation Labor

20,000 24,000 200,000

20,000 24,000 200,000 7,789,874

Selling Price Cont. per Unit Margin

200 91 109

Total


MARKET SHARE OBJ

-

$180 MILLION Market 10% Market Share


THE FUTURE

-

Potential product line extensions Tools for sustainable building


Questions?


Craftsman Brand Extension Deck