Kohl's Adds 2 Million New Customers in 2020 Thanks to In-Store Amazon Returns
At least 2 million new customers visited Kohl’s stores last year thanks to an Amazon.com returns service that the department store chain offers nationwide, reports CNBC. According to Kohl’s, a third of these new visitors were millennials. Kohl’s began accepting Amazon returns at 10 of its stores in the spring of 2017. By the summer of 2019, the Amazon returns kiosks were rolled out to Kohl's stores nationwide. The partnership enables the department store to accept "eligible" Amazon items — without a box or label — in stores, where associates then package the items and send them back to one of Amazon’s return centers at no additional cost to the customer.
Total Retail's Take: While seeming like an odd partnership at first, traditional brick-and-mortars are now seeing the value of working with, rather than against, Amazon. For Kohl's, the hope had been that the Amazon returns service would drive foot traffic and incremental sales to its stores, which has come to fruition with millions of new customers in just over a year since the nationwide rollout. Now Kohl's can go to work on making those new shoppers repeat visitors.
“While details of the partnership are confidential, we continue to see that this is accretive to both sales and profit,” Kohl's CEO Michelle Gass said during a conference call yesterday, according to CNBC. Conversion rates are trending upward for the people visiting Kohl’s stores to return a package to Amazon, Gass added, a key component to the retailer's strategy.
However, Kohl’s is facing pressure from a group of activist investors who have attempted to seize control of the company's board. Among other things, the group has said it’s skeptical that Kohl’s partnership with Amazon is adding to sales. In a letter published in late February, the activists called out Kohl’s “reluctance to share detailed information about the program with investors.” However, earlier Tuesday, Kohl’s reported fourth-quarter earnings and sales that topped analysts’ estimates, and the company predicts stronger growth ahead. Despite the activist investor group's concerns, Kohl's may be headed in the right direction after all by taking the unusual step of partnering with what every brick-and-mortar retailer has come to fear: Amazon.com.
Kristina Stidham is the digital content director at Total Retail and sister brands Women in Retail Leadership Circle and Women Leading Travel & Hospitality at NAPCO Media. She is passionate about digital media and handles video, podcast and virtual event production for all brands. You can often find her at WIRLC, TR, WLT&H or industry events with her camera and podcasting equipment—or at home on Zoom—recording interviews with thought leaders and business executives.
Kristina holds a B.A. in Media Studies and Production from the Temple University Klein College of Media and Communication in Philadelphia. Go Owls! When she's not in the office, she loves to go on long walks, sing around the house, hangout with her family and two pet guinea pigs, and travel to new places.