MENOMONEE FALLS, Wis. – Declaring 2023 a “set-up year,” Kohl’s is barreling ahead with plans to galvanize top-line growth in 2024.
During this morning’s Q4 call with investors, CEO Tom Kingsbury outlined 5 initiatives the retailer will pursue to drive comp growth in 2024 as part of its longer-term goal to add another $2 billion in top-line sales.
Home, Gifting and Impulse items
Kohl’s is expecting incremental sales through its expanded home, gifting and impulse categories.
Last year, it began moving seasonal gifting to the front of the store, resulting in 15% growth in the category for the year. The Christmas holiday gifting assortment achieved a 90% sell-through, and Kohl’s plans to invest more into giftable items tied to key events this year.
The expanded home strategy encompasses under-penetrated categories including home décor, seasonal décor, glassware, botanicals, wall art, lighting and pets.
The retailer will also expand the queue line assortment of impulse items offered near checkout, extending the program to 435 stores. Impulse sales grew more than 40% last year.
High-Volume Pricing
The company will scale up the key value initiative it tested last fall, which sharpens price points in private brands to boost turns and reduce markdown activity.
The pilot program covered 30% of its house brands. This year it will expand across the private label assortment.
The program is designed to provide more targeted offers (as opposed to general promotional offers) and help merchants plan more timely clearance events.
Babies “R” Us
Kohl’s new Babie’s “R” Us partnership, announced this morning, is intended to establish the retailer as a destination for the total baby category.
The company plans to open Babies “R” Us shops in approximately 200 Kohl’s stores this fall. It will also launch a co-branded Babies “R” Us at Kohl’s baby registry this year.
Sephora at Kohl’s
Sephora shops in Kohl’s stores continue to bring new and younger customers through the door.
There are currently more than 900 Kohl’s stores with Sephora shops. Kohl’s will open in another 350 door this year.
The company expects Sephora at Kohl’s to represent more than 10% of 2024 sales.
Apparel and footwear
Kohl’s is aiming to squeeze more sales from Sephora shoppers by adding new national brands to its juniors assortment.
More broadly in apparel, it will move away from its heavy concentration on casual and sportswear by expanding dressier options. In footwear, the retailer will add more offerings in casual and dress shoes.
—-
Taken altogether, the initiatives are expected to generate flat to +2% same-store sales growth this year.
“We have a lot of things that are working – and a lot of things that we want to continue to go after aggressively,” said Kingsbury.
