Imitation Greatest Form of Flattery for Kohl’s

Discussion
Apr 07, 2005
George Anderson

By George Anderson

Rival department store chains are trying to out-Kohl’s Kohl’s with shopping carts, checkouts at the front-end and racetrack floor layouts to speed
consumers as they shop the store.

The new Sears Essential off-mall format will borrow some of the very elements credited with Kohl’s success but only time will tell if the result
will be the same.

Retail analyst Richard Hastings told The Detroit News, “Kohl’s wants a piece of that Kmart/Sears pie. They are within striking distance of
Kmart and Sears stores, and they are happy to move into competitive markets because they know their new stores typically generate a lot of traffic.”

For its part, at least publicly, Kohl’s downplays any talk of direct competition with Sears Essential format or others. “I don’t feel like we are
going head-to-head with them,” said Kohl’s Corp. spokesperson Lori Sansoucie.

In Michigan, where Kohl’s is adding new locations and remodeling others, Ms. Sansoucie said the market “already has the high growth potential and
the high concentration of families with children that we look for. There is so much change that it’ll be interesting to see where they shake out, but I don’t see us as direct
competitors.”

Moderator’s Comment: What challenges and opportunities do you see facing Kohl’s? What will it take for the chain to continue its success story?

George Anderson – Moderator

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7 Comments on "Imitation Greatest Form of Flattery for Kohl’s"


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Brian Kelly
Guest
15 years 10 months ago

Your assessment of Kohl’s is limited to those aspects of place. But its selling model is successful because of its product, price and promotional strategies, too. The brand assortment, the seasonal flow, the high/low pricing, and its use of promotional media have all combined to win the heart of folks (women) who wardrobe their families and outfit their homes. All of that is in a box that is conveniently located and easy to get in and out.

Kohl’s brand experience is different but, more importantly, its customers find it more relevant than the retail alternatives.

Len Lewis
Guest
Len Lewis
15 years 10 months ago

For the life of me I can’t understand why Kohl’s is so successful. Maybe they’re buying and supply chain geniuses. In visits to their stores, they appear to be nothing more than an average discounter with fairly mundane merchandise. A recent ad blitz seems to indicate that they are following in Target’s footsteps. However, they just don’t have the same panache.

They were smart in going to shopping carts, central checkouts and racetrack layouts. Sears is doing the same. By the way, there’s no doubt Kohl’s and Sears are competing head-on. If you don’t believe me, ask anyone at Sears.

W. Frank Dell II
Guest
15 years 10 months ago

Kohl’s has been successful due to filling a niche; that is, consumers who want better (good, better, best) merchandise in a reasonable and shopable store. They are different than the many discounters (Caldor, Bradlees, Jamesway, etc.) that have departed by limiting the number of categories available. Further, they understand the customers in large number are shopping with children. A fast and easy shopping experience is what they want. While there is some overlap, the Kohl’s and Wal-Mart customers are different. Where Kohl’s is setting itself up for failure is with their deal addiction. Consumers continue to lose confidence in the price they pay because every week a better price is advertised. Longer term, this erodes trust, which leads to failure. Near term, Kohl’s will grow due to the many areas they do not have stores, the consumers will lose trust and comp store sales will decline.

Irma Nykolyn
Guest
Irma Nykolyn
15 years 10 months ago

Kohl’s delivers value at a lower price. If you like Liz Claiborne, then you can buy the Villager brand at Kohl’s and receive quality and savings. One of Kohl’s keys to achieving success is the premium it offers its credit card holders. You get special shopping days and percentage off coupons. You can return items within 6 months. Kohl’s needs to advertise its better brands to get the word out. I recently found Chaps polos for my husband and he was thrilled. It was half the price of the Ralph Lauren one at Macy’s. I don’t find the same brands or quality at Kmart. I only go to Sears for the Lands’ End brand. A Saturday sale at Kohl’s quickly grabs my attention. However, they do need to display items better. Perhaps add some vending machines with snacks too. Since they are usually in standalone locations, you have to drive away to eat.

Herb Sorensen
Guest
15 years 10 months ago
I don’t know Kohl’s well personally, but the comments about racetrack, central checkouts and shopping carts immediately piques my interest. When a shopper comes through the door of the store, they are going to pay with three different currencies: time, money and angst. If Kohl’s is allowing shoppers to acquire their merchandise faster (less time), the shopper will be more tolerant of price (money). The third cost, angst, relates to how hard it is for a shopper to find what they want and make a selection from among offered options. Our experience is that too many retailers think holding the shopper in the store for a longer period of time is a good thing. In reality, they are cutting their own throats, as the shoppers are migrating to places they can more efficiently shop. If the retailer has only the vaguest of ideas about where and how shoppers shop their store, they’re not in a very good position to make the process efficient FROM THE SHOPPERS POINT OF VIEW. The reality is that we have… Read more »
Don Delzell
Guest
Don Delzell
15 years 10 months ago

Kohl’s has benefited from the ineptitude of the moderate to lower-moderate department stores. The rise of Kohl’s came at the same time as the demise of many of the regional department store chains, as well as the waxing of Penney.

Further, the regional focus of Kohl’s was in an area poorly served in the moderate to lower moderate apparel intensive market. The greatest challenge facing Kohl’s is expanding into geographic markets with more capable competition.

Retail experts have been clamoring for a decade against the “high-low” constant promotional strategy Kohl’s employs. The arguments are well known. Yet in the fashion apparel arena, no one has successfully employed a non-promotional strategy. Kohl’s strategy has been executed well, and the customer has voted…often…that the current mix works, and works well.

Dave Wendland
Guest
15 years 10 months ago

Watching Kohl’s growth firsthand (our offices are also in Milwaukee), I believe their success is largely due to execution. They execute a “predictable” and “repeatable” shopping experience for consumers. They execute a good-better-best assortment philosophy that offers variety and price efficiency. They execute promotions very well (although one may argue that they are beginning to emulate Target’s approach because their “sale every week” philosophy was taking a toll on profits and becoming stale). They execute staff training as well as anyone in the space. And, most importantly, they execute with efficiency and speed.

This is a winning recipe for today’s market … and watch closely as I believe they will evolve quickly to meet the needs of tomorrow’s market.

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