Kohl's CEO: 'Amazon is working' #SmallBiz - The Entrepreneurial Way with A.I.

Breaking

Tuesday, January 14, 2020

Kohl's CEO: 'Amazon is working' #SmallBiz




NEW YORK — In 2019, Kohl's appeared to go all-in on its Amazon tie-up when it announced it would expand the partnership to accept returns from the e-commerce giant at all of its nearly 1,160 stores. And despite some recent questions whether the partnership, which was first established in 2017, is paying off, CEO Michelle Gass on Sunday defended it.
"Amazon is working, this returns program is working," she said during a panel discussion at the National Retail Federation's Big Show. "We're seeing the traffic, we're getting the customer, we're getting a younger customer. To what we expected, some of them are buying, you're not getting 100%, but some of them are buying."
According to data from Earnest Research, Kohl's stores that were participating in the Amazon returns program in Chicago saw revenue growth top 10% in 2018, compared to 5% at non-participating stores. Additionally, new Kohl's customers (those who hadn't shopped at the retailer the previous year) in the participating Chicago stores increased 9% in 2018 versus 1% for non-participating stores.
But the retailer's recent holiday numbers may paint a different picture. Kohl's last week reported November to December holiday comparable sales fell 0.2% year over year. With the results, which were lower than 2018's already disappointing holiday figures, the retailer now expects full-year earnings to fall in the lower end of its guidance.
While Gass said its digital, active, beauty and children's businesses grew this past holiday period, it was its women's apparel segment that fell short of expectations. "We expected a little bit more," she said. "Women's is 30% of our business, it's 70% private label, so if we hit some speed bumps there, it has a major impact."
Kohl's is ceding market share in women's apparel to companies like Target, which said sales in the segment grew some 10% in its most recent quarter, and off-price retailers, according to GlobalData Retail Managing Director Neil Saunders. "This is reflective of the weaker proposition at Kohl's but also underlines the success Target has had in improving its own offer," he said in a client note emailed to Retail Dive.
Active, though, was a bright spot for Kohl's during the period. Investments into the category are paying off: Customers are now beginning to turn to Kohl's when seeking out activewear, according to Gass, promoting the retailer's brand partnerships with Nike, Adidas and Under Armour. "How can we stand as active and wellness for the family? It's not a trend … It's a lifestyle." Kohl's has made a big push into the segment more recently, further reflected in its partnerships with Planet Fitness and WW (formerly Weight Watchers).
But it's unclear whether that will be enough to stem sales losses in its fourth quarter and full-year. "Initiatives like Amazon returns are good at driving footfall, but Kohl's needs to convert that traffic into money in its own registers," Saunders said. "That needs to be the critical focus in 2020."

via https://ift.tt/2Jn9P8X by Caroline Jansen, Khareem Sudlow