Over two million Amazon customers chose Kohl's for their return processes in the previous year.
Kohl's, the American department store chain, has been leveraging its partnership with Amazon to drive customer traffic and sales, according to the company's CEO and industry analysts.
The convenience of returning Amazon items at Kohl's stores has proven to be a popular service, attracting at least 2 million new visitors in 2020 alone. This service, now available in all Kohl's stores for nearly two years, allows customers to return Amazon items without packaging or labeling them, as Kohl's associates handle the shipping.
This increased foot traffic could potentially lead to incremental in-store sales or brand engagement, but direct quantitative data linking Kohl's Amazon return policy to improved sales performance specifically is not readily available.
In the fourth quarter of 2021, Kohl's net revenue decreased by 10.1% year over year to $6.1 billion. The softness in traffic to physical stores and the muted demand for apparel pushed down sales during the quarter, according to GlobalData Managing Director Neil Saunders. However, Kohl's strength in home and holiday decor helped during key seasonal selling days.
Despite these challenges, the Amazon returns policy has been a positive move for Kohl's. The company's gross margin contracted 73 basis points to 32% in the fourth quarter, but for the full year, it contracted a more significant 464 basis points to 31.1%. However, thanks to a tax benefit, Kohl's net income rose 29% year over year to $343 million in the fourth quarter, and the company expects net sales to rise in the mid-teens percentage range compared to last year for the current year.
Kohl's is focusing on digital and omnichannel improvements as part of a turnaround plan due to sliding sales. While this includes improving customer experience, like facilitating Amazon returns, Kohl's still faces challenging competitive retail conditions during promotional seasons.
GlobalData research shows that only a small portion of the traffic from the Amazon partnership drives incremental sales at Kohl's. Nevertheless, Kohl's off-mall locations are contributing to its recovery trajectory, and the company is performing better than most of its department store peers. In fact, a third of the new visitors were millennials, indicating a positive shift towards a younger customer base.
In conclusion, Kohl's Amazon returns policy positively impacts sales performance primarily by increasing store foot traffic and enhancing convenience, supporting the company’s broader turnaround efforts. However, direct sales uplift from this policy alone is not explicitly documented. As Kohl's continues to focus on digital and omnichannel improvements, the partnership with Amazon is expected to remain a valuable tool in driving customer traffic and sales.
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- An editorial piece may discuss the benefits of Kohl's policy for accepting Amazon returns, drawing attention to the increase in foot traffic it has brought to Kohl's stores and potential sales or brand engagement that could result.
- In some financial reports of Kohl's, it might be noted that the company's net revenue saw a decline in Q1 2025, with challenges in digital and omnichannel platforms impacting sales performance.
- A business news article could highlight the success of Kohl's partnership with Amazon, detailing how it helps Amazon by providing a convenient returns option for customers, while Kohl's benefits from the increased foot traffic and potential sales.
- During seasons with promotional sales events, such as Prime Day, competition between Kohl's and other retailers might lead to a temporary dip in foot traffic for Kohl's stores due to overlapping sales events.
- The retail industry might find it interesting to learn about Kohl's offering a free, convenient returns option for Amazon items at its stores, reducing the hassle for customers and potentially attracting new visitors.
- Research conducted in the field of retail technology may uncover that only a small portion of traffic from Kohl's Amazon partnership drives incremental sales, but the partnership positively impacts sales performance by increasing foot traffic and enhancing convenience for customers.
