Rival’s plan to take on Kmart
There’s no dispute that Kmart has become the go-to destination for cheap homewares.
Social media is alight with fans sharing their Kmart wares and home hacks – whether it’s a perfectly organised pantry, the product that makes flying with kids easier, or a luxe-looking but dirt cheap side-table.
But what does this mean for the much smaller, Australian retailers, selling many of the same products as the giant discount store? Well, they’re hitting back.
A senior executive of a rival retailer told news.com.au: “We’re so different to Kmart it’s ridiculous,” and called out Kmart for poor service and quality. They even likened the craze for cheaper products as a “heroin fix”.
Even though Kmart sells bed sheets for little more than a dollar, the more upmarket homeware retailer Adairs expects to post a record profit this year of around $45 million. Of course, that’s still less than 10 per cent of Kmart’s $553m profit last year.
Associate Professor Gary Mortimer, a retail expert at Queensland University of Technology, said that to survive specialist retailers should not try to adopt Kmart’s strategy.
“There is room in the market for niche retailers that have a premium offer and are able to provide that to a discreet target market,” he said.
Howards Storage World, which once boasted 60 stores but now has just half the number, isn’t too concerned there’s an army of Kmart fans spruiking its wares on social media.
Howards’ Marketing Manager, Cathy Player, says that Instagram followers is not a metric of success.
“We are so different to Kmart it’s ridiculous. Hats off to Kmart, they’ve done a magnificent job in repositioning themselves, but when you go into our stores you’ll get service and that’s what you won’t get when you go to Kmart,” she told news.com.au.
They’ve also reverted to old school techniques, with an annual catalogue showing not just the myriad of products but how to style and use them.
Professor Mortimer’s advice was to aim up-market. “The top end of the market, whether its home storage or Egyptian 1000 count sheets, really don’t need the cool (Instagram) factor as they’ve already established it.
“You don’t need hacks on how to wear Chanel sunglasses better. If you have a million dollar apartment, you’re not going to put Kmart sheets on the bed, but you might head to Howards.”
Ms Player said the retailer provides high quality products that won’t fall apart in a year but are still affordable.
“People tend to think of Kmart and low prices as attractive, but I don’t want you to buy any old thing, I want you to get something that works, not something that sits there, does nothing and becomes part of the clutter problem,” Ms Player said. “You can’t get a 10-year guarantee on a bin at a discount department store.”
“It’s a long-term view, not a short-term sales fix. It feels like the rest of Australian retail is on heroin and are doing all these sales just to get the spikes. We have a steady reliable and predictable range to make a difference to people lives.”