The Day Kmart Died!

A Business Tale for how Organizational Apathy Destroys Corporate Relevance… 

 By now, we all know of the story of Kmart’s demise. Starting with the infamous headlines on January 22, 2002, which screamed out the news that Kmart had become the largest retailer at that point to seek bankruptcy protection. From there, story after story cited the reasons for the collapse – declining market share, margin erosion and pricing pressures with increasing competition from the likes of Walmart and Target, an ineffective merchandising strategy, and the lack of a brand identity that resonated with consumers. 

All seemed to make sense, but for anyone really paying attention, the reasons mentioned above and repeated in media reports were merely symptoms of a much larger cause. From there, the ill-fated chain was scooped up by ESL Investments and has continued its downward spiral. Today, the company has approximately 25 stores left in the US vs. almost 2,500 globally in the 90s. 

So, when did Kmart really die? 

Well, the exact date is somewhat ambiguous. But let’s say for the sake of this article, it’s safe to assume the occurrence happened much, much earlier. Maybe it was the day in 1999 when you drove into your Kmart, and the sign actually said “K art” because someone didn’t find it important to replace the bulb in the sign behind the “M.” 

Or maybe, it was that day in 2000 when you walked into the store only to find the floors dirty, the lights dimmer than usual, merchandise strewn across the aisles, worker outfits, and the workers themselves unkempt. It might have been the day you lost one of your hub caps in the parking lot because it was full of potholes. 

Or maybe, just maybe, it was the day in 2010 when you left the store and felt like the whole experience was frustrating and no longer friendly or enjoyable. 

What Happened? 

The symptoms cited in all the news reports filed on January 23 and thereafter were certainly true, but they weren’t necessarily accurate. For anyone paying attention, Kmart actually died the day that management stopped making things important. It died the day employees were not engaged in the business. It died the day the company stopped listening to customers. It died the day people at all levels of the company – from leadership to store clerks – saw their work as unnecessary, or worse, not valuable. 

The death of Kmart occurred on different days for each of us. From the day we decided, the company was no longer worth our time, money, or effort. The sad truth is that its death was completely preventable and provides lessons for other organizations, specifically communications pros and marketers. 

What we’re talking about is something that pervades organizations of all shapes and sizes: indifference. 

At the heart of this indifference is the lack of a coherent efficacy that is fueled by strategic communications and aligned with the business strategy, mission, and brand purpose. An effective value or purpose platform leads to a communications strategy and narrative for stakeholders to grasp and follow. An effective communications strategy allows the business strategy to be accessible to employees at all levels and be felt by customers. An effective communications strategy links all the enterprise’s respective functions – HR, Legal, Production, Marketing, Sales – knitting a common purpose and belief system in the culture and reinforcing it through decisions, policies, and systems. 

An effective communications strategy and approach reinforces trust and ensures the business doesn’t let itself stop caring. 

Sometimes the most critical role of brand supremacy and communications impact within a company is about making the entire experience Important consistently and clearly!


Gary Grates
Gary Grates

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