KMART REACHING FOR YOUNGER SHOPPER IN DOWNTOWN N.Y. UNIT
Byline: Valarie Seckler
NEW YORK — As part of its plan to corral a younger customer, Kmart Corp. unveiled its second Manhattan store Tuesday in Greenwich Village, in a neighborhood filled with students from nearby New York University and Cooper Union.
“We believe the chain has an opportunity to capture a younger consumer, and we were attracted to this site for that reason,” noted Warren Flick, the chain’s president and chief operating officer, during a tour of the store Tuesday afternoon.
“Because NYU is so near and this is a more residential area than 34th Street — where we have our Penn Plaza store — we’re merchandising 15 percent more junior goods than usual,” Flick continued. “It’s a test. If it goes well, we’ll continue.”
The store is at 770 Broadway, between Eighth and Ninth Streets, in an area filled with boutiques that cater to young people but that generally do not offer the kind of discounts for which Kmart is noted.
The opening came one day after rumors about Kohlberg Kravis Roberts & Co. and its interest in Kmart had circulated on Wall Street, helping to send the stock into wild gyrations.
“To our knowledge there is absolutely nothing to it,” asserted Flick, answering an early question during the tour.
Shifting his sights back to Kmart’s merchandising strategy in the Village, Flick said the chain placed additional junior goods on the main floor, at the front of the women’s apparel section and near the checkout aisles, in order to quickly grab shoppers’ attention.
In all, about 7,000 square feet of selling space that would be devoted to hardlines in a typical Kmart store were shifted into apparel and soft home lines in the Broadway store. Together, the two categories cover 40 percent of the selling space in the 145,000-square-foot unit.
Some 5 to 10 percent of the merchandise mix has been micro-assorted to better serve the residential urban area, said Floyd Hall, chairman and chief executive officer of the 2,143-unit Troy, Mich.-based chain.
The store’s second level caters to shoppers who want something to eat without exiting the store, with its K Cafe offering fast-food options such as pizza.
Particularly promising for the Broadway store are Kmart’s prospects for its apparel business, Flick forecast.
“With our store on 34th Street performing above our national average, we have clearly reaffirmed the strength of our apparel opportunity in Manhattan. As a result, we’ve given it more space and are projecting higher volume than our average, chainwide,” Flick added.
Flick said Kmart expects apparel and soft home lines to generate 52 percent of overall sales at the Broadway store, or more than $26 million annually. That share of business, which mirrors the apparel plan for the 34th Street store, compares with the 32 percent share averaged chainwide.
The discounter is eyeing overall sales of more than $50 million annually — the same as its 34th Street door.
Surveying the women’s wear departments, Flick highlighted the newest arrivals in its Kathy Ireland and Jaclyn Smith private labels. In the Jaclyn Smith area, he pointed out the just-arrived velour tops and pants in the chain’s new Jaclyn Smith Sport collection.
Flick called attention to Kmart’s heightened use of single-item vignettes, with color details, in the women’s areas.
“In other stores, our presentation has been wider and less focused,” Flick added.
Among the shoppers flowing into the Broadway store, Cheryl Ferebee, 33, who said she works in the neighborhood, was closing in on a Jaclyn Smith white ribbed cotton turtleneck.
“I saw a similar one at Old Navy for $22, but I’ll probably buy this one,” she said. “It’s only $16.99 and I like the quality.”
The Broadway Kmart, which marks its grand opening today with Jaclyn Smith, on hand, will be open Monday through Friday from 8 a.m. to 9 p.m., from 9 a.m. to 9 p.m. on Saturday and 11 a.m. to 8 p.m. on Sunday.