When a desperate bankrupt retailer gambled on then-unfamiliar consumer electronics brands that are today’s best selling.
The Electronics department at Kmart was my very first job. Look, I even still have one of my polos and nametags from back then. And, oy, does it smell dusty – much like the store did. Too bad I don’t have one of the vests anymore. As one of the busiest Kmarts in the country at the time, we sold a lot of electronics. In fact, our Electronics department alone had more revenue than many Kmarts did the entire store.
When I worked in our Kmart Electronics department in the early 2000s, during its first bankruptcy, one of the many challenges as a bankrupt company was getting vendors to ship product to us. Almost all of the major electronic brands immediately stopped shipping product. But, in some way, that was to our benefit. Our store never had empty shelves. But how could that be if the major vendors wouldn’t ship products?
So what did Kmart do to keep its electronics shelves full? It brought in new brands – brands that, at the time, hadn’t established strong brand recognition in America – but still quality brands that eventually would. Brands that no one else was offering at the time, quality brands at affordable prices with little to no competition.
At the time, the most prestigious electronic brand names were the likes of Sony, Panasonic, Pioneer, Sharp, and Philips. RCA was a mid-tier brand, and cheaper brands included Emerson and Sylvania for those who cared more about price than quality.
Today, most of these brands are relics. If they are still around, they no longer hold much market share in the U.S. But in 2002, they were the major brands that everyone sought out to purchase.
In lieu of those recognized brands, Kmart struck deals with South Korean and Chinese manufacturers who were then unfamiliar to the United States market. For the higher tier of products, using South Korean manufactures, they resurrected the long defunct Curtis Mathes brand as a private label and brought in Goldstar; with Chinese manufacturer HiSense as a low-to-mid tier offering.
If you’re not aware, Goldstar happens to the “G” in LG. The Curtis Mathes products were mostly manufactured by Samsung. I knew this because the shipping labels affixed to the boxes were sent from Samsung to Kmart’s headquarters in Troy, Michigan. Also, some of the instruction manuals listed Samsung support contacts. Today, Samsung and LG are leading electronics brands in the United States, but in 2002, they were barely known.
Montgomery Wards did something similar for its Admiral brand of consumer electronics a couple years prior, contracting with both Samsung and LG as manufacturers.
These brands weren’t completely unfamiliar at the time, but they didn’t hold any prominence compared to the major brands I mentioned earlier. In fact, it was rare that I encountered someone who had heard of any of these at the time. Samsung definitely had stronger brand recognition than Goldstar did, the latter of which was more familiar as a small appliance brand to those who did recognize it; same for HiSense.
Curtis Mathes itself had once been a household name associated with quality, marketing the slogan “the most expensive television set in America, and darn well worth it,” but it was a brand that faded in the 1980s. Nearly 20 years later, it was long forgotten by most and now a private label brand associated with a bankrupt retailer. Knowing they were manufactured by Samsung didn’t help much either.
I did a quick glance at old newspaper advertisements and archived websites from the era to see if my memory accurately reflected the brands’ lack of availability. The only consumer electronics products I could find marketing as Goldstar were computer monitors; with only rare references of the Samsung brand.
In fact, one article from 2010 mentions that national retailers like Sears, Lowe’s, Best Buy, and Home Depot all refused to distribute the Goldstar and subsequent LG brand during the 1990s because it was an “unknown” brand. Even regional retailers like Fry’s and hhgregg refused to stock it.
At first, I was like, how the hell am I supposed to sell these brands? Then I saw how good the quality actually was. Not quite a Sony but damn close, and considerably more affordable.
Had I known at the time that Goldstar manufactured Zenith televisions by the 1990s, that would have helped because Zenith was then a brand recognized for quality that almost everyone had heard of, probably because every quality hotel room at that time had a Zenith. By the way, I stayed in a Red Roof Inn only a couple years ago that still had one of those 25” Zeniths. I had to take a look at the manufactured date – it was 1999.
These actually became pretty good sellers. Even after the bigger brands resumed shipping, both Curtis Mathes and Goldstar remained strong sellers. Even HiSense sold decently. It probably helped that Curits Mathes and HiSense were the first flat screen TVs we offered (flat screen, not flat panel), initially as a 20” models and later 27”. The Curtis Mathes 20” flat screen sold for $209.99 and HiSense for $199.99. Also, the biggest TVs we offered were the 32” and 36” Curtis Mathes models.
Today, Samsung and LG are the best-selling consumer electronics brands in the United States. HiSense is up there too, but not quite as close as its Chinese comrade TCL. But in 2002, when Kmart began offering them out of desperation forced by the circumstance of bankruptcy, they were barely known. In doing so, Kmart almost carried these exclusively at the time. Could it be that Kmart was forward thinking, or just lucky? You decide.
