Citing comments Kevin Mansell, CEO of the department store, made at the Shoptalk conference in Las Vegas last week, Mansell said Kohl’s future lies in its ominchannel offering, and by shuttering physical stores, its online business suffers as well. Mansell said online sales were flat last year in markets where stores were closed. Over all, online sales increased 12 percent last year, noted the report.
Mansell pointed out that 85 percent of Americans live within a 15 mile radius of a Kohl’s store. “Success for us is becoming an amazing omnichannel customer,” said Mansell, who said the company’s technology investments are focusing on supporting stores.
Mansell acknowledged Kohl’s hasn’t been as agile as it should be, saying that now, with its mobile app and smaller stores, Kohl’s is enhancing its engagement with customers. Mansell explained that “stores will continue to get smaller over time.” Roughly 20 percent of all Kohl’s stores are now smaller in size. Typically a Kohl’s store is 100,000 square feet, but new ones opening are close to 70,000 square feet.
In the case of digital sales, Mansell said mobile is driving customers to come into the Kohl’s stores. Kohl’s has around 18 million people using its app, noted the report. Kohl’s has made a name for itself because of its promotional strategy in which it gives customers discounts in the form of Kohl’s cash and Yes2You Rewards, but it can also get confusing.
As a result, the retail store operator has streamlined the mobile app, enabling the Wallet feature to combine coupons, Kohl’s Cash and Yes2You Rewards, ensuring customers the best price when making a purchase at Kohl’s, noted the report.
In January, Kohl’s slashed its outlook, which sent shares down 10 percent the day of the announcement. The company said at the time it expects 2016 earnings of $2.92 to $2.97 a share, down from the past guidance of $3.12 to $3.32 a share. The company cited weakness during the holiday selling season.