Kmart to Unveil New Corporate Branding Advertising Campaign

Kmart Management Corporation announced today that it is unveiling a new advertising campaign, showcasing its premium brands and great products, focused on the New America consumer. The campaign will debut with commercials shown during the second game of Major League Baseball's World Series on October 19.

"Kmart's exclusive brands are a very powerful reason for customers to visit our store," said Julian C. Day, Kmart President and Chief Executive Officer. "Each of these brands, including Martha Stewart Everyday, Joe Boxer, Thalia Sodi, Route 66 and Sesame Street, will be highlighted in our new campaign, but we will always emphasize that Kmart is the only place to buy them. 'Kmart. Right Here. Right Now.' is our message, representing our strong presence in the community with great brands at a compelling price."

The 30- and 45-second broadcast commercials supporting Kmart's new corporate brand positioning were produced by Grey Global Group in collaboration with Carol H. Williams and the WING Latino Group. The spots, directed by Carolyn Chen, will become memorable to consumers both for their cutting edge visual style and for the soundtrack, a Kmart re-recording of the upbeat Jesus Jones hit entitled, Right Here, Right Now.

The commercials feature Kmart stores and the familiar faces that represent Kmart's exclusive brands. Resonating throughout the commercials will be a fresh Kmart experience; one expressing a cross-cultural appreciation that reflects where America is today, and where America will be tomorrow.

Specifically urban in theme, each scene of the commercials will firmly establish that Kmart knows its customers share a lifestyle and attitude that are heavily influenced by urban trends, whether they live in urban markets or not.

"With this campaign, we are truly addressing the New America consumer, an understanding that makes Kmart stand apart from all other mass retailers," said Karen Austin, Kmart Chief Marketing Officer. "Our customers are cool, fashionable and always looking for great values. The Kmart shopping experience offers them an inclusive, open invitation that sweeps across ethnic and demographic lines."

"The Kmart 'K' mosaic recognizes the communities that we serve," said Carol Williams, Chief Creative Officer, at Carol H. Williams. "It is about people, it is about energy, it is about values, it is about community -- where we all live and grow together. The visual symbolizes that these great brands, this great attitude, the inspirational and aspirational lifestyle are available to everybody through Kmart."

The commercials will air on broadcast and cable television beginning with the World Series on October 19 and continuing on primetime television during shows such as Friends, ER, The OC and Will & Grace.

Images and messaging will be integrated throughout the commercials, in stores, online at Kmart.com, in Kmart's weekly advertising circular and on department-store style shopping bags available in stores.

Grey Global Group (NASDAQ: GREY) ranks among the largest global marketing communications companies in the world with offices in 87 countries. Grey Global Group operates branded independent business units in many communications disciplines including general advertising, public relations/public affairs, direct marketing, Internet communications, healthcare marketing, and on-line and off-line media services. Grey's major global clients include Procter & Gamble, GlaxoSmithKline, Mars, Oracle and Warner Brothers.

Kmart Holding Corporation (NASDAQ: KMRT) and its subsidiaries (together, "Kmart") is a mass merchandising company that offers customers quality products through a portfolio of exclusive brands that include Disney, Jaclyn Smith, Joe Boxer, Kathy Ireland, Martha Stewart Everyday, Route 66, Sesame Street, and Thalia Sodi. Kmart operates more than 1,500 stores in 49 states and is one of the 10 largest employers in the country with 170,000 associates. For more information visit Kmart's website at www.kmart.com .

Cautionary Statement Regarding Forward-Looking Information and Other Matters

Statements made by Kmart that address activities, events or developments that we expect or anticipate may occur in the future are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that reflect Kmart's current views with respect to current events and financial performance. Such forward-looking statements are based upon assumptions concerning future conditions that may ultimately prove to be inaccurate and involve risks, uncertainties and factors that could cause actual results to differ materially from any anticipated future results, express or implied, by such forward-looking statements. Factors that could cause actual results to differ materially from these forward-looking statements include, but are not limited to, factors relating to Kmart's internal operations and the external environment in which it operates; marketplace demand for the products of Kmart's key brand partners as well as the engagement of appropriate new brand partners; increasing competition from other retailers; Kmart's ability to operate pursuant to its exit financing facility; outcome of negotiations on collective bargaining agreements and other labor issues with unions representing employees in Kmart's distribution centers; Kmart's ability to obtain and maintain normal terms with its vendors, attract and retain customers, obtain and maintain appropriate inventory, implement its business plan and strategies, attract, motivate and/or retain key executives and associates; and other risks detailed in Kmart's Securities and Exchange Commission filings. Kmart undertakes no obligation to release publicly the results of any revisions to these forward-looking statements to reflect events or circumstances after the date such statements were made.

SOURCE: Kmart Management Corporation

CONTACT: Michele Jasukaitis of Kmart Corporation, +1-248-463-5200; or
Jan Sneed of Grey Global Group, +1-212-546-2422

Web site: http://www.kmart.com/