Our last check-in with Kohl’s in January analyzed the likelihood of continued recovery for the chain’s in-store visits. As the Back-to-School season ramps up, we thought it a good time to revisit the brand’s foot traffic and look at what steps Kohl’s is taking to maintain its position as a major player in the department store space.
Kohl's Strong Nationwide Reach
Kohl’s potential for a comeback is fueled by the brand’s strong position in the department store space. Zooming out to nationwide visits to department stores and off-price chains shows Kohl’s is the most popular department store in the midwest, and one of the top three most visited brands among leading department stores and other off-price chains in most other states. With footholds coast to coast, Kohl’s remains primed to post strong numbers in the coming months.
The company recently announced plans to open 100 smaller format stores over the next four years, which will allow Kohl’s to reach new markets and tailor each new location’s product selection to local consumer demand. In addition, the retailer can better reach specific audiences in more expensive areas where the current format could be cost prohibitive from a real estate perspective.
Kohl's Back to School and Holiday Success
Equally noteworthy is the fact that Kohl’s draws high foot traffic numbers at critical junctures, demonstrating the strength of the brand. Using January 2020 as a baseline, we see that Kohl’s had the largest foot traffic spikes in August and December, corresponding to the crucial Back to School and holiday shopping seasons.
Kohl’s is now making moves to reposition itself as a modern department store with curated, seasonal displays in 600 stores – just in time for Back to School 2022. The new store experience, Discover @ Kohl’s, which emphasizes exploration and inspiration, will feature unique brands with added social impact. From sustainable coffee gifts to fun sweatshirts and colorful school supplies, Discover @ Kohl’s is on track to showcase more than 30 new brands this year. Many of the brands are women-owned and/or donate proceeds to charitable causes – something Kohl’s hopes will excite and entice shoppers.
Kohl’s already performs well during August and is likely to do so again this year, especially with Discover @ Kohl’s as the focal point for this year’s Back-to-School season.
Kohl's in the Era of the New Department Store
It’s no secret that department stores are seeking reinvention. For years, key players in the category have recognized the need to shift from a sprawling, one-stop-shop experience, to a more curated experience with a focus on discovery, personalized service, and convenience.
In addition to the launch of Discover @ Kohl’s, the brand is investing in modernizing its existing stores. The brand is testing self-serve returns and self-checkout alongside the already popular Amazon Returns, and buy online pick-up in store (BOPIS) services. According to Kohl’s, approximately 40% of the brand’s online orders are being fulfilled by stores. It’s likely that some online customers picking up in-store stay to browse and continue shopping, driving positive visitation trends. These numbers bode well for Kohl’s as it continues to invest in digital integration.
Another bright point for the brand is the continued strength and expansion of the Sephora shop-in-shop partnership. Sephora offerings in Kohl’s stores give shoppers looking to discover and test out new beauty products a reason to visit the brand’s brick-and-mortar locations and answers the need for convenience while providing a curated experience. Foot traffic data shows that Kohl’s stores with Sephora shop-in-shops are consistently outperforming stores without the beauty partnership, demonstrating a significant opportunity as it expands this partnership. The uptick in visits from Kohl’s-Sephora stores could continue to grow exponentially as demand for cosmetics increases in a post-facemask environment.
The Takeaways
As a brand, Kohl’s certainly demonstrates a strong position in the department store category. And that strength, coupled with inventive shifts designed to reinvigorate and modernize the chain – including a smaller-store model, integration of digital shoppers, and a strong Sephora partnership – provides reasons for optimism regarding the brand’s prospects.
Back-to-School shopping is in full swing, and the launch of new brands with Discover @ Kohl’s could provide a significant boost to the chain in the coming months.
For more data-driven retail insights, visit placer.ai/blog.
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