Did you hear?... Sears purchases Lands' End for $1.86 billion

When word came down that Sears (NYSE: S) had agreed to purchase Lands' End for $1.86 billion in cash on May 14, we really didn't give it much notice.
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When word came down that Sears (NYSE: S) had agreed to purchase Lands' End for $1.86 billion in cash on May 14, we really didn't give it much notice. After all, Lands End isn't exactly core outdoor or even fitness, though we will acknowledge that the clothier does compete somewhat with the likes of L.L. Bean, REI, EMS, etc. when it comes to casual outdoor lifestyle clothing. But then the emails started coming in wondering why on earth we hadn't said anything. Our readers are right so, in our inimitable fashion, here is what we think. SNEWS® View: Sears, lacking a clothing line of its own, needed to acquire Lands' End as much for its Web presence as for its strength as a clothing brand of choice for young, upscale consumers. Its strong lifestyle-fitness items can also lend add on sales to Sears strong fitness equipment areas. Lands' End needed Sears to give it a strong presence in a brick-and-mortar environment without having to undertake the expense of establishing the presence itself. The risk is that the Sears' customers and product mix is not considered upscale in any way, shape, or form so Lands' End risks damaging its brand by association -- perhaps the main reason the company has made it clear Sears will not be listed on any of its own catalogs. Sears will be able to put heavy promotional dollars behind Lands' End so just as the Gap impacted outdoor years ago, it is possible that Lands' End could do the same if, and only if, the outdoor lifestyle look continues as a strong play. The other risk for Lands' End is that the service its customers have become used to may not be lived up to as well by Sears … time will tell. For its part, Lands' End representatives have been very upbeat and assertive stating without fail that Lands' End will remain upscale and lifestyle and that is the attitude Sears wants to embrace.

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