Kohl’s goes experimental with a concept store in Tacoma, Washington – WWD

Is the future of Kohl’s Corp., based in Menomonee Falls, Wis., in Tacoma, WA?

More experimental than ever, Kohl’s has created a “concept” store in Tacoma that reimagines and modernizes the retailer’s physical experience.

The 35,000 square foot setting – much smaller than Kohl’s typical 80,000 square foot box – has set a soft opening for this Sunday but officially opens Nov. 4.

Potentially, Tacoma could be the prototype for future stores, and elements of it could be applied to existing stores.

“In this digital and physical world, the bar has been raised. We must provide ease and convenience while providing innovation and discovery. This store is a big manifestation,” Kohl’s General Manager Michelle Gass said Thursday afternoon during an online tour of the concept store.

“A 35,000 square foot box is the model we are looking to grow. We see 100 more stores in our future.

“But above all, this store is still a concept – an experience. That’s not how we decided to go to 100 stores yet,” Gass explained. “We have a working model” for the smaller stores that will be rolled out. “We actually have several of those working in terms of experience and economy, and then that [Tacoma] is to take a blank sheet of paper, put the customer first, use analytics and data, and say, “We’re designing a store from the ground up.” So what is possible? »

Walking through the concept store, Gass called the setting “very open and very modern.” Floors are polished concrete, and it’s possible to move fixtures and racks to a greater extent than in existing traditional Kohl racetrack layouts across the chain. Flexible editing means it’s easier to expand or contract brands and categories based on sales trends. Tacoma’s fixtures have an overall more modern look, and displays and shelving are also updated, with branding now at eye level.

With the assortment, “it has all the great stuff we’re known for but edited out,” Gass said, citing Sephora, which has a smaller space than it would have at Kohl’s other locations. As she has repeatedly pointed out over the past few months, Gass said Sephora “works for Kohl’s” and that by next year it will be in 850 Kohl’s stores, and eventually all 1,100 stores. Kohl. Sephora is currently present in approximately 600 Kohl locations.

Gass pointed out that Kohl’s used data to create “a highly localized experience” in Tacoma and an assortment characterized by a more focused assortment of outdoor gear, such as Columbia and Eddie Bauer.

In the concept store, “The way we walked through the store is different,” Gass said. “In front is the women’s area flanked on both sides. True to that market, it’s all about the active, outdoor lifestyle, so because it’s fall, you see fleece, you see flannel, and you see family apparel.

“You hit customers with product the moment you walk in,” Gass said, noting that the checkout area has been moved to put merchandise front and center.

“It’s about inspiration and storytelling. Our customers have told us, “I’m running out of time. I want solutions. Help me put together outfits. We mix brands. It’s not a head-to-toe brand.

“We’re using more dummies,” Gass added. “You will see it throughout. Please note, we have flesh-colored mannequins and mannequins of all sizes.

In May, the company revealed plans to open about 100 small-format stores over the next five years or so in markets untapped by existing Kohl’s stores. The expansion of small-format stores follows a successful pilot project of more than 20 smaller stores, the company said. The average Kohl’s store of around 80,000 square feet is considered too large for many small markets.

“The real estate team has already identified what those markets might look like,” Gass said. “We have a store concept that works today. It is a more modernized version. The Tacoma store is just a huge step up, with a lot of things experimental, like self-checkout, how we do it at home, and whether customers like our active, outdoor-inspired “hallway.” »

While smaller stores are key to future expansion, Gass said she sees no need to scale back existing Kohl stores across the country because they are very “cash-generating and healthy.” Instead, the focus would be on adding additional concepts to the 80,000 square foot space. “There’s a pipeline of innovative ideas the company is working on to make stores more relevant,” Gass said.

“We’re in a big reinvention when it comes to Kohl’s, and it’s about starting with the customer, positioning the company to be a leader in the active-casual lifestyle,” Gass said. “Across many principles of our strategy, thinking differently about experience is an important part of this transformation strategy. We’re doing a lot across the store to reflect the new strategy of the active, casual lifestyle.

While the casual and active chain-wide and online push channel started in 2020, Tacoma’s concept store took about a year to build and get up and running. “We really challenged ourselves,” Gass said. “We’re going to learn a lot from this strategy that will inform new stores going forward. [and that we can take] back to our very robust fleet.

The women’s section of the Tacoma concept store.

In addition to the reduced square footage, most striking is the increased use of mannequins and the more sophisticated display of private label and national active, casual and outerwear brands, such as with the “hallway” format, for telling style and trend stories and showing outfits to encourage multiple purchases, much more openly than Kohl’s usually does.

“The active, outdoor hallway, a real manifestation of location, the outdoor lifestyle, with Columbia, Eddie Bauer, Nike, Under Armour, Adidas, everything for the family, and even the merchandising of adjacent things like bags of sleeping, it’s all data-driven,” Gass said. “We’ve been working hard on creating a scalable model, getting that outdoor, active amplification in this particular store. If this new concept was in the South, you’d see something very different displayed in the hallway, probably a lot more shorts, swimwear, tank tops, summer-oriented products. It’s really about fostering relevance, inspiration, and ease of purchase.

“Brands are really chosen based on what that customer is buying,” Gass said. “In women, customers were attracted to our private labels, such as SO and Sonoma, which stands for Nine West, which is a big brand for the company, which we don’t have in this store. This was the thought in every department of the store. It’s much more organized in both product types and brands based on customer ideas.

The checkout is no longer in front, but to the side, making the merchandise the first impression upon entering the store. Kohl’s is testing self-checkout in concept, while having associates run the checkout.

“The look and feel is quite different from how we usually make payment,” Gass said. “This is the first Kohl’s store where we’re putting the checkout area not in the front but actually on the side, so customers can walk right into the product.” Because Tacoma is a relatively small, open store, “it won’t take long for customers to see the checkout area,” Gass said. And the self-checkout, she added, “has the latest hardware and software.

“There’s a lot of experimentation that’s so essential in the store,” Gass said. “This is a bold step forward for Kohl’s. You feel like you’re seeing Kohl’s, but it looks and feels different in a good way. We will change things as we learn from the customer.

Eddie Bauer, among the newest additions to the Kohl’s mix, at the Tacoma concept store.

In other innovations, the reception area has a product showroom experience. Product thumbnails are visible throughout the floor, and customers can purchase the entire thumbnails directly from their phone via a QR code.

Tacoma’s concept store also features “Discover at Kohl’s,” a store featuring dozens of emerging brands, established and owned by various newcomers to the retailer, and already in 600 locations and on kohls.com.

Nike at the Kohl’s concept store in Tacoma.

The cash desk of the Kohl’s concept store.

To create the concept store, Gass said the company brought in an exterior design firm “in the beginning. … But it was really a team from Kohl that brought it to life in the totality that you see here.”

When asked how long it would take before deciding whether to roll out the concept or scrap it, Gass replied, “Sometimes if we see it working right away, we could scale it faster, I think. that with something like this it will take a bit of time while we tweak and iterate. There will be a lot of testing and learning. I really consider it a learning lab for Kohl’s.

Asked if, per square foot, the costs to recreate the concept store in other locations would be greater than what it takes to expand the traditional Kohl’s store, Gass said, “At the end of the day, if we had to evolve all of this, you can assure us that we will have a great return for the company. We’re always flexible about how long we test things.

In addition to the new concept store in Tacoma, Washington, Kohl’s will open three small-format stores in San Angelo, Texas this fall; Morgantown West Virginia and Lenox, Massachusetts.

Kohl’s is under pressure to reduce sales and declining profits and looks to this holiday season to regain market share, and for some recently implemented strategies to kick off and resonate with buyers, including adding of its Sephora beauty stores. The second quarter saw a 63% drop in second quarter revenue and an 8.5% drop in sales.

For months, shareholder activists have been questioning strategies and demanding changes in leadership and board composition. However, Tacoma’s concept store reflects Kohl’s drive to change, step up its innovation efforts and become more relevant to consumers.

A “parade” for the active category at the Tacoma concept store.

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