Kohl's Mobile Makeover

"Going mobile" and "embracing omnichannel" have essentially become go-to buzzwords for retail in 2016. No matter what is actually going on, no matter what is being sold — pretty much every major merchant has announced that its future will be digitally driven, that mobile is the wave of the future and that they are dedicated to creating the best imaginable omnichannel experience for their customers.

Now, how that actually cashes out varies greatly. Walmart, Target, IKEA, Best Buy, Macy's, CVS, Kroger, Lowe's is an extremely short list of the great big retail players that have announced massive digital upgrades this year and big plans for big expansions down the line, all with somewhat different focuses. Some are more expected — rewards and payments enhancements; some are fairly exotic, like the rapid onset love affair with virtual and enhanced reality. But they all have a common end: keeping hold of their customers and their conversions as the landscape digitizes rapidly around them.

Kohl's has been particularly pegged by the rough road that retailers — particularly department store players — have faced in 2016. After a particularly tough earnings report in Q1 that sent investors fleeing, Kohl's was part of the department store rally in Q2 that did see it beat Street expectations on revenue, which certainly satisfied investors. But Kohl's won the same pyrrhic victory lots of department store players did during Q2: It beat expectations, which were low, but continued to show the same underlying weaknesses that led to those low expectations — falling same-store sales. In Kohl's case, it was a decline of 1.8 percent year over year.

A trend of decline will not long beat expectations, and going into holiday 2016, Kohl's is aiming to get those numbers marching in a different direction and leveraging mobile and omnichannel to get there.


Go Big, Or Go Home 

Kohl's, however,  is taking a broader aim at omnichannel offerings pushing into holiday 2016. Shoppers can browse in  "store mode" for the Kohl’s mobile app, enhanced mobile payment options, like Apple Pay and cardless checkout in-app, a single shopping bag across platforms and Visa Checkout on and on mobile so that customers can keep payments information on file securely.

The Apple Pay tie-in — first announced back in May — has gotten the most airplay because it offers a first-of-its-kind benefit for the Apple Wallet: It allows  customers in the Yes2You Rewards program to pay directly through Apple Pay.

Kohl's Yes2You Rewards program is a tender agnostic loyalty program that allows customers to earn points, regardless of their method of payment. Customers do not need to use Kohl's Charge in Apple Pay to earn loyalty points in Apple Pay. Kohl’s Yes2You Rewards members can add their Yes2You Rewards to the Apple Wallet by simply tapping the “Add to Apple Wallet” link at the bottom of their Yes2You Rewards email. Once added to the Apple Wallet, customers can use any form of tender and earn rewards points with one tap in Apple Pay.

The somewhat less noted update to mobile payments will actually make it possible for Kohl's customers that use a Kohl's card to skip most of the register experience itself by allowing direct checkout through its mobile app. Those purchases will aggregate promotions and rewards as well.

So, don't want to stand in line this holiday season? It seems some Kohl's shoppers won't have to.

"We feel like we're really taking it up a notch," Michelle Gass, Kohl's chief merchandising officer, noted.

The mobile payments options are designed to work in tandem with store mode, which allows users to use the app to search store inventory and find in-store promotions that can be applied to their purchase.


But Is It Broad Enough?

While customers will clearly appreciate not having to work hard to connect their mobile payments to their rewards programs — and anything that can make lines less a factor is an improvement worthy of the Nobel Peace Prize — one has to wonder if Kohl's recent improvements' limitations will hamper their popularity.

Kohl's  mobile checkout — a great perk of a Kohl's card and perhaps a reason to solicit one for a consumer who already shops frequently at Kohl's. But for those who don't — probably not much of a draw.

Now, it is possible that we are seeing the early part of a mobile strategy getting its first very big test drive in holiday 2016, and great things are yet to come.

But for now, it seems, Kohl's is on the right track but still has a lot of mobile seams showing.



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