In its second-largest acquisition, Amazon buys the company for $970 million.
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At this point, Sears does not appear focused on price. In fact, a survey of a few popular products shows prices on Sears’ sites tend to be higher than those of competitors. For instance, a Sony Bravia 32-inch television sells for $549.00 on Sears.com, $499.00 on Amazon.com and $494.00 on Walmart.com. A Char-Broil three-burner gas grill sells for $299.00 on Kmart.com and $219.99 on Amazon, while a Casio Men’s analog-digital watch sells for $49.95 on Sears, $34.00 on Walmart.com and $32.95 on Amazon.com.
Its pricing policies may help explain why Sears, while making headway online, is still being outstripped by competitors. For instance, while Sears’ online sales grew 3% in 2009 to $2.8 billion, even as same-store sales declined by 5.1%, that paled before Walmart.com’s nearly 20% growth last year to $3.5 billion in web sales. In fact, Walmart.com last year passed Sears as the No. 1 general merchandise retail chain in terms of online sales, a mantle Sears had held for years.
Similarly, while Sears showed one of the biggest improvements in customer satisfaction in a 2009 holiday season survey by ForeSee Results, moving up five points to 75, it still lagged the e-retail industry average by four points and e-commerce leader Amazon by nine.
Those results show Sears faces big challenges and tough competition. But in the past few years Sears’ executives have demonstrated they are willing to try just about anything to reinvent Sears as a leading direct-to-consumer retailer for the Internet age. Other retailers no doubt will watch closely to see what they can learn from what works, and doesn’t, for Sears, as the process of reinvention unfolds.