"Inside Scoop"-News

"The fabulous Thalia Sodi Collection is an important addition to Kmart's portfolio of exclusive brands," said Day. "As the Store of the Neighborhood, we continue to be focused on developing a merchandise assortment that meets the wants and needs of our diverse customer base. This new merchandise was designed and developed to meet the needs of the new American neighborhood -- a melting pot of culture, lifestyle and trend. The Collection is groundbreaking and just a hint of what you can expect from the new Kmart."

"My Collection is a dream come true," said Thalia Sodi. "I am so excited to have created a line that has been inspired by my culture -- showing its color, its passion and its greatness -- and one that captures much of my personal style. I hope the Collection's broad appeal will excite my fans and attract many new customers to Kmart."

The partnership between Kmart and Thalia Sodi was announced in December 2002. Since then, Thalia has worked closely with Kmart's team of designers to develop a collection that captures her personal style and attitude. In select Kmart stores now, the Collection includes branded apparel for women and girls, as well as footwear, accessories, jewelry, intimates, hosiery and bed and bath products. The Thalia Sodi Collection is available in 335 Kmart stores including those in the New York City, Los Angeles, San Francisco, Miami, Denver, Las Vegas, Phoenix, San Diego, Chicago and Puerto Rico areas.

"Thalia Sodi the person and Thalia Sodi the brand are one and the same, reflecting a lifestyle that is active, passionate, bold, fashion-conscious, and original," said Kmart Divisional Vice President of Product Development and Trend, Joe Wagner. "Ever mindful of the wants and needs of our diverse customers, throughout the development of the Thalia Sodi brand, Thalia worked hand-in-hand with our team at Kmart, incorporating her interpretation of the on-trend, fashion-forward woman. We are very fortunate to have Thalia Sodi as part of the Kmart family."

Style seekers will be drawn to the colorful prints, original styles and on-trend silhouettes of the Thalia Sodi Collection. The assortment includes logo-laden pants, active apparel and accessories; graphic T-shirts; tanks; sweaters; and embellished and embroidered denim. The girls' assortment includes satin cargo pants and coordinating baseball jacket, silk-screen T-shirts, and embellished denim. Thalia Sodi intimates are of incredible quality and include brightly colored camis, thongs, panties and bras. Her accessories include high fashion handbags and shoes. The jewelry assortment includes straight-off-the-runway looks such as shoulder-grazing earrings, multi-layered necklaces, chokers, pendants, amulets and crosses.

The bedding assortment boasts six colorful patterns, such as Sangria, Peacock Feathers and Shadow Safari, which are inspired by the singer's travels and her own home decor. Thalia Sodi bedding is sold in complete sets that include a comforter, 200-thread count sheet set, shams and bed skirt. Coordinating pillows, table covers and valances are also available.

In addition, the Thalia Sodi Home Collection includes four bath ensembles that match the bright bedding. The bath products include shower curtains, rugs, towels and accessories.

Kmart customers will enjoy the "boutique" style in which the Thalia Sodi Collection is merchandised within Kmart stores. Apparel and accessories are merchandised together so that creating a complete, coordinating outfit is effortless. Bright pink signage featuring photography of Thalia wearing her apparel and the Thalia Sodi signature logo, capture the bold look and feel of the Collection.

The Thalia Sodi Collection will be promoted throughout Kmart's advertising circular and Spanish-language feature publication, "La Vida," as well as through national advertising on television and radio. In July, the launch of Thalia's English-language CD and an exclusive DVD available only to Kmart shoppers was promoted nationwide in Kmart stores and in the Kmart weekly circular. Thalia was featured in the July 6 edition of "La Vida" magazine, the largest circulated Spanish-language publication in the United States with a circulation of more than 1.8 million.

From July 13 to August 3, a series of teaser ads produced by Alturas Communications ran in English and Spanish newspapers and on in-store signage in areas where the Collection is sold. The teasers featured a call-to-action and highlighted the unique qualities of Thalia, the performer, and the Kmart Collection with language such as, "Be Bold," "Be Original," "Be Yourself," and finally, "Be Ready." An eight-page fold-out poster in Kmart's August 10 weekly circular followed these advertisements.

"The Thalia Sodi Collection reflects Thalia Sodi as an individual -- daring, enthusiastic and passionate -- and her advertising campaign is just as vibrant," said Karen Austin, Senior Vice President and Chief Marketing Officer for Kmart. "The Thalia Sodi television commercial is in Spanish and was inspired by what Thalia describes as the young, modern woman of today. The Thalia Sodi Collection reinforces Kmart's commitment to the neighborhood with products that reflect our customers' heritage and culture, and are created by a superstar they know and love."

A national television spot produced by Cultura and featuring the single, "Baby I'm in Love," from Thalia's latest album, will run from August 7 to August 23. Radio advertising will air from August 24 through September 21 on Spanish-language stations. In addition, the Collection will be promoted through Kmart.com where select products also will be available for purchase.

Born Thalia Ariadna Sodi, she began her career as a child on Mexican television, in Mexico City's theater and as a member of the popular children's singing group Din Din and the teen pop act Timbiriche. As a teen, Thalia rose to international stardom with starring roles on soap operas. Since Thalia's solo singing career began in 1991, she has released 10 solo albums that have all gone platinum across the world, culminating with her recently released first-ever English-language album, "Thalia," which entered the Billboard Charts at number 11. Her first single from the album, "I Want You," hit the Top 10 on the Top 40 Mainstream Chart this week and has reached the Number One spot in several other countries.

Kmart Holding Corporation (Nasdaq: KMRT - News) and its subsidiaries (together, "Kmart") is a mass merchandising company that offers customers quality products through a portfolio of exclusive brands that include THALIA SODI, DISNEY, JACLYN SMITH, JOE BOXER, KATHY IRELAND, MARTHA STEWART EVERYDAY, ROUTE 66 and SESAME STREET. 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 .