Kohl’s experiments with concept store in Tacoma, Washington – WWD

Is the future of Menomonee Falls, Wisconsin-based Kohl’s Corp. in Tacoma, Washington?

As experimental as ever, Kohl’s has created a “concept” store in Tacoma that rethinks and modernizes the retailer’s brick-and-mortar experience.

The 35,000-square-foot environment — much smaller than the typical 80,000-square-foot cabbage box — has set a soft opening for this Sunday, but will officially open on Nov. 4.

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

“In this world of digital and physical, the bar has been raised. We must offer simplicity and convenience while delivering innovation and discovery. This store is a great manifestation,” Kohl chief executive officer Michelle Gass said Thursday afternoon during an online tour of the concept store.

“A 35,000 square meter box is the blueprint for our expansion. We see 100 more stores in our future.

“But above all, this store is still a concept – an experiment. So we haven’t decided yet to scale up to 100 branches,” explained Gass. “We have a working model” for the smaller stores that are being launched. “We actually have several of those who work in terms of experience and economy and then that [Tacoma] It’s about taking a clean sheet of paper, putting the customer first, using analytics and data, and saying, “We’re designing a business from scratch. So what’s possible?’”

Strolling through the concept store, Gass characterized the setting as “very open and very modern”. Floors are polished concrete and there is the ability to move jigs and racks throughout the chain to a greater extent than existing, traditional Kohl’s racetrack layouts. Flexible attachment means it’s easier to scale up or down brands and categories based on sales trends. Furnishings in Tacoma look more modern overall, and the displays and shelving have also been updated, with the branding now on par.

Regarding the range, “it did all the great things that we’re known for but edited,” Gass said, citing Sephora, which has a smaller slot than other Kohl’s locations. As she has repeatedly pointed out in recent months, Gass said that Sephora “works for Kohl’s” and that it will be available in 850 Kohl’s locations next year and eventually in all 1,100 Kohl’s stores. Sephora is currently represented in around 600 Kohl’s stores.

Gass emphasized that Kohl’s used data to create “a highly localized experience” in Tacoma and a range that is characterized by a more focused lineup of outdoor gear, such as B. Columbia and Eddie Bauer.

In the concept store, “the way we let the store flow is different,” Gass said. “In front is the women’s area flanked on both sides. True to this market, everything revolves around the active and outdoor lifestyle. So since it’s fall, you see fleece, you see flannel, and you see family clothing.

“You meet customers with products right as they walk in,” Gass said, noting that the checkout area has been moved to the side to place merchandise front and center.

“It’s about inspiration and storytelling. Our customers have told us: “I don’t have enough time. I want solutions. Help me put outfits together.” We mix brands. It’s not a brand from head to toe.

“We use more mannequins,” Gass added. “You see that everywhere. What is remarkable is that we have skin-colored mannequins and mannequins of all sizes.”

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

“The real estate team has already identified what these markets might look like,” Gass said. “We have a store concept that works today. It’s a more modern version. The Tacoma store is just a big step forward with lots of experimental things like self-checkout, the way we do it at home, and whether customers like our ‘hallway’ of active and outdoor inspiration.”

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

“We’re in a major reinvention at Kohl’s, and it’s about starting with the customer and positioning the company as a leader in active and casual lifestyles,” said Gass. “In many tenets of our strategy, an important part of this transformational strategy is to think differently about the experience. We are doing a lot across the store to reflect the new strategy of active and casual lifestyle.”

While the casual and active push began chain-wide and online in 2020, it took about a year for the Tacoma concept store to be created and operational. “We really challenged ourselves,” Gass said. “We will learn a lot in this strategy that will inform new business in the future [and that we can take] back to our very robust fleet.”

The women’s section of the Tacoma concept store.

Apart from the reduced space, what is most striking is the greater use of mannequins and the more sophisticated presentation of activewear, casual and outerwear own brands and national brands, e.g. For example, using the “corridor” format to tell style and trend stories and show outfits to encourage multiple purchases, much more overtly than Kohl’s typically did.

“The active and outdoor corridor, a true manifestation of localization, the outdoor lifestyle, with Columbia, Eddie Bauer, Nike, Under Armour, Adidas, everything for the family, and even merchandising things alongside it like sleeping bags, all based on data ,” Gass said. “We worked a lot to create a scalable model to get that outdoor and active reinforcement in this particular store. If this new concept were in the south you would see something very different walking down the hall, probably a lot more shorts, swimwear, tank tops, summer orientated products. It’s really about promoting relevance, inspiration and easy shopping.

“Brands are really chosen based on what that customer is buying,” Gass said. “In women’s clothing, customers have been drawn to our own brands like SO and Sonoma, which means that Nine West, a big brand for the company, which we don’t have in this business. That was the thought in every single department of the store. It’s much more curated across both types of products and brands based on customer insights.”

The cash register is no longer in the front, but on the side, which means that the goods make the first impression when entering the store. Kohl’s is testing self-checkout in the concept, along with employees who do the checkout.

“The look and feel is very different than what we usually do at the checkout,” Gass said. “This is the first Kohl’s store where we moved the checkout area to the side rather than the front, so customers can walk right into the product.” Because Tacoma is a relatively small and open store, “it won’t be long before until customers 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 important in business,” Gass said. “This is a bold step forward for Kohl’s. You get the feel of seeing Kohl’s, but it looks and feels different in a good way. We will change things as we learn from the customer.”

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Eddie Bauer, one of the newer additions to the Kohl’s mix, at the Tacoma concept store.

In further innovations, the home area offers a product showroom experience. Product vignettes can be seen throughout the floor and customers can purchase the entire vignette directly from their phone using a QR code.

The Tacoma concept store also has Discover at Kohl’s, a store featuring dozens of emerging, established and diverse brands new to the retailer, already available in 600 locations and on kohls.com.

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Nike at Kohl’s Concept Store in Tacoma.

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The checkout area in the Kohl’s concept store.

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

When asked how long it would take to decide whether to roll out the concept or drop it, Gass replied, “Sometimes when we see it working right away, maybe we can scale it faster, I suppose that something like this will take a while while we tweak and iterate. A lot is tested and learned. I really see it as a learning lab for Kohl’s.”

When asked if, on a square foot basis, the cost of redesigning the concept store in other locations would be greater than developing the traditional Kohl’s store, Gass said, “Ultimately, if we scale this up, you can ensure that will have a great return on investment for the business.” . We are always flexible when it comes to the duration of the test.”

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

Under pressure to pare slacking sales and profits, Kohl’s is hoping this holiday season to regain market share and some recently implemented strategies to take off and resonate with shoppers, most notably the addition of its Sephora beauty stores. The second quarter saw a 63 percent decline in second-quarter revenue and an 8.5 percent decline in sales.

For months, activist shareholders have been questioning the strategies and calling for changes in management and the composition of the board. However, the Tacoma concept store reflects Kohl’s willingness to change, increase its innovation efforts, and become more relevant to consumers.

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A “walkway” for the active category in the Tacoma Concept Store.

https://wwd.com/business-news/retail/kohls-concept-store-tacoma-washington-1235403105/ Kohl’s experiments with concept store in Tacoma, Washington – WWD

John Verrall

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