Kmart Promotes Senior Advertising Exec

Kmart has made changes at the top of its ranks of advertising executives, although it doesn’t expect changes in its current marketing strategy.

The troubled discount retailer announced it had promoted Barbara J. Firment, 50, to SVP/Advertising, Sales and In-Store Presentation. In her new position, she’ll supervise the weekly circular and other newspaper advertising, direct mail and in-store promotions. She reports to Kmart CEO James Adamson. Firment had been VP/Advertising and In-Store Event

Two other executives have become vice presidents in the advertising department. Chad Harrison, 41, is now VP/Sales and In-Store Presentation. He’ll supervise sales promotions, store signage and product presentation. Shawn Hearn, 37, is now VP/Advertising. He’ll lead planning and production of the weekly circular, other newspaper advertising and direct mail.

Both report to Firment.

Early this year, Kmart filed for Chapter 11 bankruptcy protection amid a falling stock price and poor holiday sales. The Troy, Mich.-based retailer continued Monday to post steep losses, with a net loss of $137 million in June and $96 million in May. Same-store sales fell 8.7% in June compared to a year ago, not including the 283 stores the company has closed as it tries to fight its way out of bankruptcy. Its stock price, $13.55 in August 2001, stood at 69 cents at the end of trading Monday.

Part of the company’s turnaround strategy has been to reach out to the minority market, which makes up a little less than half of its consumers. In late February, Kmart kicked off its “Stuff of Life” campaign, which has been rolled out in every aspect of the company’s advertising and branding from TV and weekly circulars to in-store placards.

“The Stuff of Life” marks the first time Kmart has had a unified campaign across all media and inside the store as well, according to Dave Karraker, Kmart director of marketing communications. He said the idea is to have all branding and sales-message material carry the same look and feel.

In recent years, analysts have questioned some of Kmart’s advertising decisions. In the third and fourth quarters of 2001, as Kmart drew closer to bankruptcy, the company made cutbacks in weekly advertising circulars. Kmart replaced the weekly circulars with advertising promoting its “Blue Light Always” campaign, when that effort was being emphasized. The “Blue Light” campaign has been demphasized and weekly circulars resumed, Karraker said.

Kmart plans to increase marketing and advertising with new efforts, although Karraker declined to discuss specifics. He also said the company was reviewing its media buys for effectiveness.

“We’re always adjusting our mix,” he said.

GartnerG2 analyst Gale Daikoku said Kmart has tried different advertising and marketing strategies to battle Wal-Mart, the leader in discount retailing. After a period of lost identity, Kmart executives decided to compete with Wal-Mart by following in its footsteps. But she said Kmart did that without having Wal-Mart’s operational efficiencies.

“That’s not something that Wal-Mart built in two years or in 10,” she said. “Kmart doesn’t have anything close to that,” she said.

Daikoku said this year’s cost-cutting allowed Kmart to embark on the advertising campaign, which she said tries to appeal to its key demographics and convince them to return.

“They’re going to have to build consumer confidence, and get them into the stores,” Daikoku said.

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