Sears Holdings may soon lose its No. 3 market share position in the appliance market to Best Buy as it continues to fall further from the No. 1 ranking it held as recently as 2013, according to an analysis from The Motley Fool.
It has been four years since Sears lost the market lead to Lowe's, and later the No. 2 market position to Home Depot. Together, Lowe’s, Home Depot and Sears account for about 58% of all appliance sales. However, Best Buy is closing in on Sears’ third-place 13% market share, according to the analysis.
The analysis comes less than two weeks after Sears announced the closing of another 18 Sears stores and two Kmart stores, but also talked up the opening of its latest Sears Appliance & Mattress store in Texas.
There is no way to sugar-coat the observation that Sears has been free-falling in just about every retail market segment for several years at this point. It widespread closing of stores has a bit of a snowball effect in segments like appliances, which customers come to brick-and-mortar stores to check out. Appliances are one type of product that Sears could still draw people into stores with, yet the closing of its locations means that those potential showrooms are becoming fewer and farther between, which also makes the Sears name shrink even smaller and further out of the minds of customers in the market to buy said appliances.
Could the development of the new Sears Appliance & Mattress store concept reverse the trend? The new 20,000 ssquare foot Texas store followed the opening of what was tagged as a prototype store last year in Colorado. In addition to featuring appliances from Sears' native Kenmore brand, other brands also are prominently featured and interactive displays seem to embrace modern design ideas for brick-and-mortar retail.
Perhaps operating a specialty store can restore Sears' reputation in the appliances arena, especially if it quickly expands on the concept. However, the retailers that have been eating Sears' lunch in the appliances market in recent years are not specialty retailers themselves, for the most part. Lowe's and Home Depot would be described more as home improvement retailers, and Best Buy is still more of an electronics retailer than anything else, although it has stepped up its game in the smart home market, which overlaps with the appliance sector.
In its most recent quarter earnings report, it wasn't lost on Best Buy that it is close to over-taking Sears in appliances. The retailer called out appliances as one area of major growth at a time when some of its other product channels have weakened.
Despite dire predictions, Sears continues to linger, but it is probably getting very close to decision time: The retailer will have to decide how much longer it wants to fight for its illustrious department store past, or whether it should throw all of its energies into pursuing a small handful of market segments.