Sears’ Shop Your Way: Not A Better Mouse Trap

“We believe we can build a better mouse trap.”  — Eddie Lampert (CEO), 2014 Sears Holdings Annual Shareholders Meeting

Sears believes that they can build “Shop Your Way” into a profitable and successful multi-channel online retail platform and that it will have a meaningful position in the marketplace alongside Amazon, eBay, Wal-Mart, Target, Macy’s, and every other retailer out there. Given how much the Sears and Kmart brands have eroded over the years, coupled with retail industry competition that has only increased during that time, I believe such an investment is a waste of shareholder capital. Skeptics aside, the company continues to press on, but it’s not pretty. Sears Holdings today reported more red ink in their second quarter results.

Now, it’s true that the jury is still out to some extent. Just because Sears and Kmart have been losing customers by the boatloads and burning cash for several years running does not mean that Shop Your Way can’t work. When you have more than 1,800 stores nationwide and tens of billions in annual sales, there are clearly people who are willing to do business with you. It really comes down to whether or not you can serve them in a satisfactory way.

Along those lines, I decided to give Shop Your Way a try. They’ve been building this platform for several years, so most of the kinks should have been worked out by now. And while I would never suggest that anyone make investment decisions based on their own personal anecdotal evidence, I do think it is fair to say that one’s own experience is likely to be indicative of what is typical in many instances. Below I will detail my two recent experiences with Shop Your Way.

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First I downloaded the company’s Shop Your Way mobile app just to play around with it. After linking my wife’s Shop Your Way account (she is already a member thanks to sporadic purchases over the years from Lands End — which until recently was a subsidiary of Sears), I was unimpressed (the $0.88 worth of points in her account notwithstanding). The app lacked a lot of features. Perhaps most glaring was the lack of an order history. If you want to look-up a past purchase you have to login to their full web site rather than use the app. That seems rather odd. You can also not change personal information in your Shop Your Way account, such as password, phone number, email address, etc.

So while there are lots of features missing, there are others that Sears seems to think are important. One is GPS tracking that allows the app to know when you are in a Sears or Kmart store. Your phone will vibrate upon detection of your presence, ask you to post a status update (yes, just like Facebook) and offer you coupons that you can use that day. For avid Shop Your Way users, I can see this being a nice feature.

That said, the other day my wife and I were in Starbucks enjoying a beverage when my phone vibrated. I assume it was a new text message, but no, it was the Shop Your Way app. It wanted me to “check-in” (they call it “shop’in“). At this point I was baffled. Why would I check-in to Shop Your Way at a Starbucks? Are they doing some sort of cross-promotion with the coffee chain?

Well, it turns out there used to be a Sears store in the same complex as this particular Starbucks and since I was within a few hundred feet of it, the app thought I was actually shopping at Sears. Normally I would give them a pass here, since GPS tracking on mobile phones typically is only accurate to within a few hundred feet. But this instance is a little different because this particular Sears store actually closed permanently a few months before. In fact, the app seems to know something isn’t quite right. Under the store’s details it shows the store’s street address as “lease ending 12/31/2015.”

So the whole experience is bizarre, but at least I know sales at that Sears store were so bad that they closed the store before the lease was up even though they are still paying rent on vacant space. Pretty telling if you ask me. Anyway, I obliged and submitted a status update as requested. Answering the question “what are you up to?” I simply typed “having breakfast at Starbucks, that Sears store closed months ago.” Talk about a first impression.

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Okay, so the app isn’t updated with the company’s current store base, but what about making an actual purchase with it? After all, e-commerce is what’s of utmost importance here, right? Well, a chance to test things out presented itself recently.

My wife wanted to buy a mini refrigerator for her office at work and I suggested we look at Sears since they are big in the appliance market. After comparing selection and prices, Sears actually did have a fridge that matched best with her desired parameters, so I offered to fire up the Shop Your Way mobile app and complete the purchase, hoping to have the item shipped to the Sears store at our local mall. The purchase went smoothly and the app told us the item would be ready for pick-up in 6-8 days, at which time they would email both of us (I added myself as a pick-up person in case it was more convenient for me to get the item). The time estimate of 6-8 days seemed on the long side (especially if we are comparing the convenience of Shop Your Way to the competition), but since this purchase was not super time-sensitive, waiting a week was fine (the fridge was shipping from Illinois — where Sears and Kmart are based, which is likely why it would take that long to get to Seattle).

Exactly 7 days later we both received an email alerting us that the fridge was ready to be picked up at the Sears store we had designated. Kudos to Sears for being on-time relative to what was promised. It was downhill from there, however. Here is a screenshot of the email my wife received as it was displayed in Gmail:

syw-email-1

 

Oh boy. Where to begin. Of the four sentences in this email meant to give the customer important information, three of them have problems.

The second sentence appears to be trying to tell me where in this particular store the online order pick-up area is located. That would be very helpful information that would reduce the likelihood that I find myself wandering around the store looking for where to go. But that field was left blank.

The third sentence says that upon arrival at the store you can either scan the bar code at the top of the email or enter the salescheck number in order to initiate the pick-up process. That would be great, aside from the fact that there is no bar code at the top of the email and the salescheck number appears to be a media file that does not load when you view the email (and yes, I made sure that Gmail was set to display all media attachments).

Lastly, the fourth sentence contains another blank field that was clearly supposed to insert my name letting my wife know that I received the same email and could pick-up the item for her.

If you are trying out Shop Your Way for the first time, does this experience scream out “better mouse trap!” to you? Hardly. And we have yet to even make the trip to the store yet. Needless to say, I was dreading the trip since I knew that 1) I did not know where to go, and 2) I knew I was likely to have issues once I got there since I had neither a bar code nor a salescheck number to provide them.

But before we get to that, how about a screenshot of the email they sent me as the designated secondary pick-up person:

syw-email-2

 

So much for thinking/hoping that the first email may have just been a glitch. Houston Hoffman Estates, we have a problem.

The same day my wife and I head to the Sears store to pick-up the fridge. There is one sign on the lower level designating the corner where online pick-up area is located and we walked right past it due to where we happened to park and enter the store, so that was not a problem (but it might very well be if you entered from the interior mall entrance directly, as there were no signs pointing us in the right direction). In the designated pick-up area there is a kiosk sitting outside of the warehouse area where they keep the inventory stored. Fortunately, you can use your credit card or phone number to look up your order if you don’t have a bar code or a salescheck number (I guess we are not the only ones to have this problem, but in that case, why not do away with both and just let people use the phone number linked to their Shop Your Way account for order retrieval?).

After finishing with the kiosk, which was quick and easy, our order is shown on a monitor on the wall that is tracking how long it takes for the item to be brought out to us. The company’s goal is 5 minutes or less and on that mark they succeeded. There were two employees working the warehouse area so while there was nobody in plain sight to answer any questions you might have, the kiosk worked just fine. So despite the issues with their email system, this particular Sears store has a perfectly adequate pick-up area. In fact, there were 3 other people picking up items in the 5 minutes or so we were there. If you are looking for a silver lining in all of this, there you go.

Summing everything up, it isn’t hard to understand why Sears is losing money. This $100 item likely cost them $70-$75 wholesale. They had to ship it from Illinois to Seattle on their own dime (it was about 50 pounds, so shipping wasn’t cheap). Then they incur costs at the store to get the item to the customer when they arrive. The idea that they can compete with Amazon or Wal-Mart or Target or Home Depot in this fashion seems suspect to me. And so far their financial results aren’t proving otherwise.

20 thoughts on “Sears’ Shop Your Way: Not A Better Mouse Trap”

    1. Nope, still own them and think they represent a strong risk-reward opportunity. This post was more about the lack of progress on the SYW front, as opposed to becoming even more bearish on the stock than I already was. My view that the debt is a better investment than the equity on a risk-adjusted basis remains intact and that is how I have capital allocated.

  1. FWIW, I ordered a Craftsman lawn mower last week Sunday and it was delivered to my front door on Tuesday morning. Couldn’t be happier with the price and service……

  2. That Southcenter Sears is a decent store for Sears standards. We usually park on the parking garage and enter the nearest entrance to Sears since I find at any mall that parking is plentiful at Sears, no matter how busy the rest of the parking lot is. It baffles me how a small Sears store back home in Upstate New York can get a full remodel with new exterior logo and all, but this store at such an upscale mall as Southcenter goes untouched. The only decent/remodeled SHC property around here is the Kmart in Spanaway, and that’s only because of fire damage from an arson.

    With the Shop Your Way program, I’ve been using it since either 2008 or 2009 when my market back in New York was a test market for it. I’ve never had any problems with the program except for when the cashiers scan my card after scanning a few items; this results in member prices and coupons like $10 back in points for spending $50 not to be applied. The best experience was probably this past spring when we found a Craftsman weed eater marked down to $14 and change. With my points and Max membership it was delivered to my house from a store in NH and I didn’t pay a cent for it.

  3. I picked an order at Sears that I ordered from shopyourway.com. I can tell you the experience is the best I’ve ever seen more than Amazon. The whole ordering process n picking up the product took me about 30 mins (5 mins for picking-up at sears store). Stop blabbering n appreciate good customer service.

    1. You’re an idiot. Sears is one of the worst companies there is. Haha. Sears sucks. Cant wait for all of Sears to go extinct.

  4. My experience with Shop your way has been a hassle both times I tried to redeem points. The first time only required one phone call. The most recent one is up to 7 calls and I am still angry with the botched service I received. I was sent this email:
    You have $50 in surprise points (50,000 points) to redeem
    on your Sears or Kmart purchase of $250 or more.*
    HURRY! These points are valid through 4/22/15. Redeemable in store or online at Sears or Kmart.
    I finally was able to find 4 items that added up to more than $250. But the website wouldnt let apply the points. So I called the Shop Your Way 1-800 number and was told I should go ahead and place the order, and they would then apply the $50 credit. So foolishly I did. Then I got an email saying that one item didnt apply as it was only sold by Sears but was an outside vendor. So no $50 credit. I called again and was told the SYW people couldnt cancel the order and I would have to call another number. So I spoke with another person, explained I had placed the order within the last hour and needed to cancel since the points wouldnt apply. A young man said he would cancel the order. I soon got an email for cancelling ONE of the items. I called AGAIN and was told that the cancellations were “processing” so not to worry. The next day the emails saying my order had shipped started arriving! I called again and was told there was nothing they could do. I would just have to refuse the delivery when it came. Talk about bait and switch! Here – use these points to get a discount – then no you cant use the points on that item and No we cannot cancel the order.

    1. Read the fine print on points. It says that you can’t use them on market place items. Sold by sears or kmart.
      But I agree that their customer service department is complete waste of capital. SYWR is Still ok. But their IT systems leave them in dark. Sample this. Being a SYW VIP member, i got a coupon for 99% off a Dewalt wrench set. There was an item number for the set in coupon text that i would have to add to cart for coupon to work. Guess what, the item is a woman dress and coupon didn’t work on that either. Called them and was given another sku, no go on that too. Someone is supposed to get back to me on that still.

  5. I tried to buy a replacement battery for a portable spotlight, and made the mistake of using paypal during the checkout. the transaction has been pending for a week, with no progress. they sent me an email saying there was a problem, but none of the links in the email take me back to the shopping cart, or even to a working website to correct the issue. the problem is that paypal doesn’t pay until they ship, and they won’t ship until paid, a classic deadly embrace!

  6. I am sorry that everyone has received such misfortune with Sears and the Shop Your Way program. I must be that 10% that has received decent service because, overall, I’m fairly pleased.

    The only issue I have had was that today I attempted to return an item and there is no record of my ever having purchased it online. In fact, my old orders no longer show up in the online “Order Center”. But they’re in my email, so I can at least access them. Thankfully, I got the issue resolved by calling Customer Service (and using Chat simultaneously, just in case) and getting a return label sent to my email. And other times when I have had to get the points situation resolved online, the Chat service has been indispensable in that regard.

    Other than that, I have no complaints about Sears and SYRW. In fact, I’m not sure how they make money off the program, because they’re basically handing out free money. Over the course of 10 months, I have purchased at least $130 worth of items for less than $20 through combining the Surprise and Reward points. The only thing that would make it better is if I had a MasterCard partner card, so as to sync my SYW account with my card.

    Any one else have a similar positive experience?

  7. this is really more about “shop their way”. I selected some merchandise, and during checkout I made the mistake of trying to pay with paypal. they are obviously not set up to handle this. they won’t ship until paypal actually pays them, and paypal won’t pay until the item is marked as shipped. a classic deadly embrace. to make it worse, sears sent me a confirmation email, and none of the links in it worked properly. one link brought me to the default sears page, and the other ones gave me a 505 not found error, so I could not even modify or cancel the order. I then had to wait out the 30 day period for paypal to release the hold on my money, while they waited for sears to ship the item. perhaps sears needs to hire a real IT department.

  8. SEARS SURPRISE POINTS IS A SCAM NO WONDER SEARS IS CLOSING DOWN-
    Sears send surprise points emails to use XX$ before XX date.Then you cannot find anything to buy online for following reasons:
    You can buy online mens apparel only or some condition like that.
    you can buy only from sears not from K mart for in store delivery.Delivery charge $35 on $9 item?
    You cannot buy items from other sears vendors from sears site.
    This list of what you cannot buy goes on and on and unfortunately you will only know when to try to check out.So you start searching again and again cant check out.3hrs wasted
    If you succeed and buy online or in store and for any reason you return the item all the in store sears persons will tell you ” Dont worry you will get it back into your points”
    They take the items and DO NOT CREDIT AMOUNT BACK TO POINTS AND THEY WILL NOT TELL YOU DURING RETURNS.
    Now item is gone.Obviously why will you return item when they dont give points back to your credit.You buy $18 with $12 surprise points and $6 regular points.Receipt will say zero and when you return it will click as $6 and they do not have any idea about $12.
    sears will tell you they are giving you free surprise points.Actually it is not FREE they are giving only because you have bought previously in the store.This does not happen with kohls cash when you return you get the full amount.Once you buy the item from any points sears must return points to make customer buy again and again.

    sears must have a simple system…buy anything…and once you return points go back

    Iam a fan of sears but its sad to see a good store like sears go due to stupid policies which makes customers to loose the trust on them.sears sends 4 emails a week.
    sears store in Madison WI -Good store bad policies.-Bottom line does not increase by keeping the returns and not crediting it
    K

  9. Just spent 3 hours going round and round with searssywsearssyw over a locked account. I acknowledge that I may have fat fingered the new password(that I was only required to enter once!) but been locked out for 8 days now. finally resorted to e-mailing syw support-got an automated direction sheet on how to create an account. Getting late, guess I will just go to bed and take my experience for what it was worth. bye bye Sears and syw!

  10. FYI You can redeem points at Starbucks that’s why your phone vibrated not cause there was an old Sears store…..maybe you should do some more research before writing an article and not just assume…

  11. I wish I had read all these negative reviews of Sears.com and Shop Your Way, 10 DAYS AGO, before I got involved in an order for tires, that so far, hasn’t materialized.

    I was “surfing the net” looking for some tires, and a “pop-up” from Sears.com hit my laptop. Usually I ignore these things, but the price caught my attention…and AHA….the price looked quite good, as it was advertised as being a 4th of July sale. Not wanting to blindly place an order through the website, I called the 888 number, and surprisingly, was rather quickly connected to a sales rep.

    We discussed the price, and I was assured that it was indeed valid, with no hidden add-ons, other than local sales tax, and the tires could be at my local Sears Auto Center, ready for pickup, in 3-4 business days….maybe a day or two longer, due to the 4th of July holiday. OK, so I placed an order. The following morning, there was an order confirmation in my e-mail folder. 3 days later, July 5th, just to check on the progress, I logged on to the Sears.com website. However, no matter what I did, all I got was an error message telling me the site was temporarily down (this continues to be the case, 5 days later). I tried the call center again, and the woman I spoke with couldn’t find the information, she said they were having computer problems……NOW, I’m getting a little worried!

    I called the local Auto Center, on Thursday, July 7th, and after 3 attempts, somebody finally answered the phone. This fellow checked the shipment they had received that day, and the tires weren’t part of it. I used my Sears credit card for this transaction, so out of curiosity, I called the credit card service line, right after talking to the Auto Center, and SURE ENOUGH, the tires had been charged to my card…….even though I didn’t have them.

    Yesterday morning, I tried the Auto Center again, and once again, the tires hadn’t arrived. The first person I talked with, didn’t know how to track a Sears.com order, so he turned the call over to the manager. He, too, was a little unsure how to do it, but took my name and number, and promised he’d get to the bottom of it, no later than tomorrow. Apparently the Sears departments and/or computer systems, don’t talk/link with each other….GREAT!! Furthermore, I’ve also tried calling the call center both yesterday ad today, with no success. Nobody answers the phone, you’re on eternal “hold”. In fact, my cordless phone has a timer on it, so yesterday, when I called, I set it on speaker phone, while I ate lunch, and hoped someone would take my call. 22 minutes of hearing “tech tips” from “The Blue Team”, while on hold, (THAT’S RIGHT, 22 MINUTES!!!) and I gave up. I tried a few times today, again, with no luck. I’m beginning to think they’ve blocked my phone number……

    SO…….9 days, no tires (and the rebate on the tires, which was an incentive to buy them, expires in a couple of days), no clue where they are, and there’s been an $800 charge to my credit card.

    AND THE SEARS EXECUTIVES WONDER WHY THE COMPANY, AT ONE TIME THE STANDARD BEARER IN RETAIL, IS IN TROUBLE?????

    They seem to have forgotten, customer service IS #1…………..and there’s one other thing they need to remember. While a satisfied customer will tell 10-12 people, a dissatisfied customer will tell EVERYBODY!! (and yes, this HAS been researched)

    1. At Sears and KMart, the left hand has no clue what the right hand is doing. Every call I am told, “Oh, you need to call another department. We don’t handle that.” I literally was passed around for 2 hours, including hold time, and ended up back to the person I initially called.

  12. Just a follow-up to my above post, regarding the “phantom tires”. The manager of the local Sears auto center eventually was able to reach someone at the call center, who then traced the order for him. This was two days after I wrote the above rant, and he told me they had him on “hold” for close to 90 minutes (!!!!).

    At this point, he said the tires were being dispatched from a local tire warehouse, and “should be in tomorrow, but I’m not holding my breath”. At least he was honest, and he followed up by saying he’d call me as soon as they showed up. Sure enough, however, he called me the following afternoon, to tell me that they had indeed arrived, and if I wasn’t in the middle of painting a room in my house, and the Auto center wasn’t on the opposite side of town, I would have immediately gone off to get them. Instead, I picked them up the first thing the next morning.

    Although this was a somewhat frustrating experience, I will say that both of the fellows that I dealt with at the local Sears Auto Center were friendly, courteous, and patient. Now, if the paperwork on the rebate goes through properly, I’ll be very happy. I’m keeping my fingers crossed!

  13. I purchased several items online at kmart.com. When I got to the cart, the system had added coupons and QB bonus offers correctly. I selected to pay with cr card. It confirmed that I will get 40320 SYWR points ($40.32, actual value less than 1/2 because of various constraints) on this order. I saved a screen print.

    I received email confirmation for the order confirming ‘you earned 40320 points expiring in 14 days. I checked every day for the points to be credited so I can use them. After a couple of days I spoke with a SYWR agent about the points. She said I do not get any points. Asked me to email copies of their email confirming the points earned. I did. and the response from SYWR is disgusting, bordering on scam. Reda on…


    Thank you for contacting Shop Your Way regarding your points balance.

    We are sorry for any confusion the points estimate you saw has caused. The point balance displayed is an estimate only and we are unable to honor those points. The confirmation email does state: Points displayed are estimates only. Points earned vary based on purchase(s), offers, cancellations, or subsequent modifications to your order. If you are ever wondering what your account balance is, you can verify your account balance information by visiting http://www.ShopYourWay.com.

    Once again, we do apologize for any inconvenience that this situation has caused. Thank you for contacting us and being a Shop Your Way member. We value your business and look forward to serving you in the future.

    Sincerely,
    Debbie F.
    Shop Your Way Member Services
    http://www.shopyourway.com

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    1) They call $40 in points only an “estimate’ that actually could be $0
    2) Cheating you out of $40 is mere ‘inconvenience’. It is stealing!
    3) It took 7 days (out of 14 available to use the points) to get a reply
    4) How can you trust SYWR/Sears/Kmart if they would not stand behind their WRITTEN email and shopping cart. Are these offers just a joke or scam?
    5) Without the points, the merchandise is not worth even half the price they charge. Their shoddy merchandise is going back!
    6) Shame on Sears/SYWR for this kind of scam

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