Kohl's Drives Growth Through Focus on Customer Engagement, Personalization

In a keynote presentation yesterday at the eTail West conference in Palm Springs, Calif., Greg Revelle, chief marketing officer at Kohl's, discussed the retail chain's initiative to personalize its marketing communications and improve upon the shopping experience for its customers across all channels. Revelle noted that it's an exciting time to be at Kohl's, as the department store chain has been able to weather some lean years at the outset of this decade and return to profitable growth. He cited the challenging environment in which Kohl's is operating, with competitors closing stores, but also the opportunity this presents for the Menomonee Falls, Wis.-based retailer.

"Other retailers are closing stores; we're not closing our stores because they’re profitable," Revelle said. "We also see an opportunity when other retailers' stores are closing. Store closures are a big opportunity, not a liability."  

Revelle added that Kohl's has recorded five straight quarters of positive comps, and that customer engagement levels are at all-time highs. However, he cautioned the company can't take this success for granted and rest on its laurels.

To that end, Kohl's has put in place an aggressive plan to provide clarity to three core components of its business: customers; merchandise value proposition; and brand position and purpose.

Customers

Kohl's customers share common traits, according to Revelle. They appreciate value; they shop for themselves and their families; and they demand quality and style. With that understanding of its customers, Kohl's can begin targeting these personas with personalized communications and offers that are more likely to generate positive results.

"We didn’t feel any other retailer was doing all three of these things," said Revelle. "There's clarity on the growth opportunity."

Product

Kohl's offers a mix of private-label and national brands at its stores and online. The company wants to ensure it's offering great product all the time, while also introducing new brands into the collection, Revelle said. Recent brand partnerships that Revelle noted include LEGO, Nine West, Property Brothers, and POPSUGAR.

In addition to new brand partnerships, Revelle noted that Kohl's customers can use Kohl’s Cash to purchase every product the retailer sells. The innovative promotional tool generates incremental purchasing for the company.

Brand Position and Purpose

Kohl's mantra is rewarding the everyday. The philosophy is core to the brand, its customers and employees. That’s not enough, however.

"We have to do more," Revelle said.  

To improve the customer experience and reward the everyday, Kohl's has invested in personalization tools that will help it to continue to differentiate from its competitors.

"Personalization is expensive and hard to do," noted Revelle, "but we sensed an opportunity to invest. [It] Requires a lot of data, and we have a lot of that. ROI at the end of the day is what we're after."

Kohl's objective was to shift its marketing from being channel-centric to omnichannel; segmented to one-to-one; largely manual to being enabled by technology and automated; and evolving from data subsets to data supersets.

For Kohl's, personalization means that customers are heard, recognized, engaged, and provided with a seamless journey. For marketing, the customer experience should be the right message, in the right channel, at the right time. Personalization allows us to do this better, said Revelle. 

The approach for Kohl's to enable this level of personalization involves many components, including teams (agile and cross-functional); KPIs (measurable objectives, clear and aligned, with sales the ultimate measure); customer-centricity; speed and agility (value speed and learning over perfection, scaling quickly); and technology (a connected technology road map).

Revelle wrapped up his presentation by talking about what the future of personalization looks like for Kohl's. He cited personalized, curated site content (e.g., outfitting based on customer data) as well as gamification, identifying the Meet Your Match game that the company rolled out to match footwear with customers based on persona data.