A year later, and Martha hasn't set foot in Sears

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Almost a year after the Sears/Kmart merger was sold to investors on the idea of cross-selling, i.e. Martha Stewart in Sears and Craftsman in Kmart, that same message isn't being marketed to shoppers.

Instead of sharing brands this holiday season, Sears is telling shoppers to "wish big" and highlighting its proprietary brands as it harks back to its iconic "Wish Book" in spots from WPP Group's Y&R, Chicago, that are already on the air. Kmart breaks its effort today, composed entirely of 15-second spots, from WPP's Grey Worldwide, New York. The ads push its proprietary brands while promising shoppers Kmart has "everything on your list."

Maybe next year

And surprisingly, marketing leaders on both sides of the Sears/Kmart divide aren't talking the cross-selling talk right now.

"Sears and Kmart are completely different platforms, one is more mass and Sears is more department store, they are completely different," said Becky Case, VP-creative services at Sears. "We would not combine the advertising because we are operating as two separate retail platforms."

Joshua Stern, director-national advertising for Kmart, said a combined campaign "just wasn't feasible because of the way the structure is with upfront and buying inventories, it's harder to do this year. The integration, I would envision taking place next holiday season."

For now, Kmart's campaign takes a humorous approach depicting the craziness of the holidays and how Kmart can help, as well as promoting its Martha Stewart and Route 66 brands, among others.

Cross-selling with the Sears brand will only be done in limited markets with weekly newspaper circulars for both Sears and Kmart, Mr. Stern added. He said that despite 50 Kmart stores being converted to the Sears Essential format-an off-mall format combining the Sears and Kmart stores-not all of Kmart's 1,479 stores have Sears brands, such as Craftsman and Kmart.

"Like every big company that merges, there are some adjustments that have to be made so on the national level, we are not going to be cross-promoting yet."

What Martha product?

But this vision doesn't appear to be shared by Ms. Case at Sears. When asked about Martha Stewart product in Sears, she said there was none, and instead referred to the successful Spring launch of a Ty Pennington line that rivals Kmart's Stewart products, with everything from towels, bedding, rugs and shower curtains. "Ty is selling quite well," she said.

The divergent campaigns have some analysts wondering how well the merger is faring, especially as both retailers enter a tough holiday season critical to improving lackluster results posted so far this year.

"That was the whole theory of the merger," said Kim Picciola, a retail analyst with research firm Morningstar, who has a "hold" rating on the Sears Holding stock. "Why don't the campaigns promote Sears Essentials? That's the next move. That's what is going to take the Sears brand and this merger where it needs to go," she said, adding, "We haven't seen any major changes, although they've certainly made management changes."

In fact, not only has Sears Holding Co. chairman Eddie Lampert taken personal control the combined company's marketing and advertising, in the last month the top marketing officers at the retailers were replaced by a CMO of Sears Holding Corp., overseeing both brands. Sears declined to make that executive, IBM marketing vet Maureen McGuire who is only days into the job, available for comment.

But Sears appears to be trying to focus on its own identity rather than create a new one post-merger. The "Wish Big" broadcast spots feature shoppers in a fantasy town lugging home gargantuan KitchenAid mixers or Craftsman tools. The launch included a one-day display of a three-story globe on Times Square, with live people inside acting out holiday scenes like wrapping presents.

The launch is part of the retailer's efforts to downplay a sale message, Ms. Case said, noting Sears would "rather be known for our iconic, proprietary brands."

Sears also plans to tap some historic brand sentiments, with an emphasis on the Wish Book, or what was once the holiday edition of its catalog, discontinued in the mid-`90s. Thousands of tiny Wish Books with an accordion format will feature the chain's top 25 gifts, such as a KitchenAid mixer and a Craftsman drill kit. No prices will be included.

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