INTERVIEW-Sears woos appliance shoppers with new stores, ads

* Marketing touts low prices, no-interest financing

* Retailer to open 50 home appliance showrooms this year

By Karen Jacobs

HOFFMAN ESTATES, Ill. (Reuters) - Sears, Roebuck & Co, whose sales have been hit by a soft U.S. economy, is moving to revive its appliance business by wooing shoppers with new stores, best-price promises and no-interest financing.

The retailer is opening at least 50 showroom-sized stores dedicated to home appliances this year in high-traffic strip malls. It has also boosted training in product knowledge and energy savings for its appliance staff.

"We've got great things to tell and we just haven't been saying them in a way that has been clear to the consumer," Steve Light, appliance general merchandise manager for parent Sears Holdings Corp (SHLD.O), told Reuters in an interview at company headquarters.

"We've got a vision .. to re-engage and rebuild our relationship with the American consumer," said Light, who took up the post earlier this year.

Sears says it will beat any competitor's appliance prices, even if it means looking them up on the Internet while the shopper is in the store. In October, it will begin a program offering zero percent financing and no payments for 12 months every day.

This week, the company launched an advertising campaign aimed at cash-strapped consumers who are seeking greater value for their money. Thirty-second TV spots feature an "appliance blue crew" touting low prices, financing offers and next-day delivery to most U.S. ZIP codes.

The Hoffman Estates, Illinois, company has long been the top-selling U.S. appliance chain although its dominance has been challenged in recent years by rivals such as Lowe's Cos (LOW.N) and Home Depot (HD.N), which have expanded their offerings of kitchen and laundry products.

The slumping U.S. housing market and a growing financial market crisis have contributed to its woes. Sears Holdings, controlled by hedge fund manager Edward Lampert, posted a 62 percent decline in second-quarter profit last month on lower same-store sales at Sears and Kmart stores.

Last week, Fitch Ratings downgraded its ratings on some of Sears debt, warning that future liquidity levels could fall.

NEW FOCUS ON KEY UNITS

Sears Holdings is rebuilding its management and focusing on key businesses such as appliances and apparel, so they will be poised to grow when the economy steadies.

"Although the economy today is very poor relative to big-ticket items, appliances will be a growth category," said Douglas Moore, president of Sears Holdings appliance business.

"It's moving from being a white-goods business to a multi-color, multi-platform, multi-shape business with many choices around green, style and innovation," Moore added.

That renewed focus includes changes within stores and fine-tuned advertising messages. For instance, displays such as a "laundry gallery" with washing machines in a variety of colors are being added in mall-based stores to attract shoppers.

Sears is also increasing efforts to showcase the different brands it sells besides its private label Kenmore appliances. Model kitchens feature appliances from manufacturers such as Sweden's Electrolux (ELUXb.ST) and General Electric Co (GE.N).

Banc of America analyst David Strasser wrote in July that Sears gained 30 basis points of market share in the second quarter after 13 previous quarters of share losses.

Sears said it does not comment on market share.

Sears Holdings shares were up $1.87, or 2 percent, to $95.30 in Nasdaq trading on Friday.