The New York Times has an interview with Kohl's CEO Michelle Gass, who since joining the company in 2018 "has been working to carve out a distinct identity for the company … Among her moves — besides keeping the stores open during the pandemic — has been striking a series of partnerships with other companies.
"The most unconventional was a deal with Amazon in 2019 that allows customers to return Amazon products to Kohl’s stores. While there, Ms. Gass hopes, they might do some shopping. Another new partner is Sephora, the beauty retailer, which is setting up mini-stores inside Kohl’s locations. It’s a bit like, well, a department store."
Some excerpts from the interview:
• "Kohl’s had a successful model for a long time, sort of this hybrid department store brand, but with mass mall convenience. But over time that got blurred. So the challenge and opportunity is, 'OK, what is the space we can occupy that will be differentiated?' Part of it was becoming a relevant omni-channel retailer. And I really feel like we’ve checked that box. But from a product and brand standpoint, how are we going to be more relevant? How are we going to have a brand stand for something?"
• "We are very far apart from what a traditional department store is. We are small, we’re super convenient and that allows us to do things like buy online, pick up in store and curbside. But more importantly, we see ourselves as a specialty concept, that Kohl’s is the curator and the editor to bring you all the products and brands you need to lead a more active and casual lifestyle."
Regarding the Amazon deal, Gass says, "When you take a step back and think about what it’s like to return goods, it can be very inconvenient in the traditional way, especially with online returns. Looking for the box, looking for the tape, attaching the receipt, all of that. We’re addressing that pain point. Amazon gets a deal that can address the friction point, and we’re able to leverage our appetite and welcome in traffic. It was certainly unconventional at the time when we announced it, but I think it worked out really well."
- KC's View:
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It is hard for me to imagine that Kohl's has a long future as a stand-alone company. It just seems likely that at some point it is going to be acquired by a larger entity … maybe an online company that is looking for a greater foothold in the physical retail world, and has expressed an interest in small-scale department stores.
