Sephora to set up shops in 850 Kohl’s stores
Rendering: Kohl’s

Goodbye J.C. Penney. Hello Kohl’s. That’s one of the takeaways from yesterday’s announcement that Sephora and Kohl’s have reached a long-term deal to open co-marketed beauty product shops in 200 Kohl’s by next fall with an ongoing rollout that will see the store-within-in-a-store concept growing to at least 850 locations by 2023.

The “Sephora at Kohl’s” shops are being billed as immersive premium beauty product destinations. Kohl’s will locate the 2,500-square-foot shops at the front of their stores. Each shop will feature 100 brands curated to appeal to the 70 percent of Kohl’s 65 million customers  who are women.

Shops will be staffed by Beauty Advisors trained by Sephora. The goal is to provide Kohl’s customers with a similar experience to what they would enjoy at a standalone Sephora store.

Sephora will sell its products on Kohls.com in addition to stores, and purchases will be eligible for Sephora’s Beauty Insider rewards. The two retailers said they will integrate their e-commerce sites to allow shoppers on Sephora.com to find nearby stores from either chain. Customers will be able to make returns to Kohl’s and also take advantage of in-store and curbside pickup at its stores. Kohl’s will own the Sephora inventory and the two retailers will share operating profits generated by the shops.

Sephora to set up shops in 850 Kohl’s stores
Rendering: Kohl’s

Kohl’s CEO Michelle Gass called the deal with Sephora a “transformational partnership” in an interview with CNBC. She said the agreement was reflective of her company’s “new strategy to be the destination for all things, active, casual, wellness and beauty for the family.” Kohl’s is in the process of expanding key categories, including beauty, she said, while reducing or eliminating space for others that do not align with the chain’s objectives.

The apparent gain by Kohl’s in its deal with Sephora is unfortunate news for its former store-within-a-store partner, J.C. Penney, which is still looking to fully emerge from Chapter 11 bankruptcy. Rumblings of discontent in the partnership emerged in the spring when Sephora, no doubt concerned about the department store’s struggles and plans to close locations, sought to find a mutually agreed upon exit to a deal scheduled to run through next April.

BrainTrust

“Execution will be the deciding factor on whether this is a brilliant move or if it fails to live up to expectations.”

Dave Wendland

Vice President, Strategic RelationsHamacher Resource Group


“Adding to their partnership with Amazon, Aldi, Planet Fitness, and Fanatics, their latest collaboration with Sephora will continue to upgrade Kohl’s attractions.”

Di Di Chan

President of FutureProof Retail


“Penney’s road to recovery just got harder.”

Dick Seesel

Principal, Retailing In Focus LLC

Discussion Questions

DISCUSSION QUESTIONS: What will the Sephora at Kohl’s partnership mean for the two respective retailers’ businesses? How much will losing Sephora hurt J.C. Penney?

Poll

Do you agree with Kohl’s CEO Michelle Gass’ assessment that the Sephora deal is transformational for the two strategic retail partners?

View Results

Loading ... Loading …

Leave a Reply

25 responses to “Sephora to set up shops in 850 Kohl’s stores”

  1. Neil Saunders Avatar
    Neil Saunders

    Kohl’s needs to become less reliant on apparel and find other categories to boost its growth. Beauty is an area where Kohl’s is currently underdeveloped so it doesn’t capture much spend from shoppers who are already in its stores. Adding a Sephora automatically resolves this issue and it also makes Kohl’s a more interesting destination which may help to drive foot traffic.

    From Sephora’s perspective, Kohl’s provides access to many locations where Sephora is currently underrepresented and will help widen the audience somewhat. At a time when J.C. Penney is struggling, Kohl’s provides a new partner that will help to offset the closure of many J.C. Penney stores.

    1. Dick Seesel Avatar
      Dick Seesel

      You’re right about women’s apparel, which Kohl’s has already promised to edit. The growth of women’s active at Kohl’s came at the expense of floor space in misses’ and juniors’ apparel, but a 2500-square foot Sephora shop will require a more cold-eyed look at these businesses.

  2. Adrian Weidmann Avatar
    Adrian Weidmann

    Sephora has become a shopping destination magnet and anywhere they open their umbrella is going to be beneficial for those in close proximity. Having both Sephora and Amazon under their roof makes Kohl’s a winning brick-and-mortar retailer. I would suggest they add a UPS counter to that mix and their stores will become a very powerful ecosystem.

  3. Dave Bruno Avatar
    Dave Bruno

    I wish Kohl’s and Sephora luck with this partnership, as I believe these types of “collaborative selling spaces” are critical to the future of retail. The opportunities to share spaces, customers, and marketing investments are all bottom-line wins. What will determine if they are top-line wins is the degree of overlap in key customer segments. While I am not certain that the most important Kohl’s segments are 100 percent aligned with the most important Sephora segments, they are certainly better aligned than the key Sephora and J.C. Penney segments. We should watch this space carefully, as Kohl’s has been a bit of a pioneer for collaborative selling spaces (e.g. Amazon returns), and it could be a bellwether for this model in the future.

  4. Raj B. Shroff Avatar
    Raj B. Shroff

    This seems an odd partnership in my view. From a brand perspective, Sephora does so many things well whereas Kohl’s is neutral at best. Kohl’s seems like the place brands go to become vanilla. Sephora will gain access to a large shopper base and Kohl’s will elevate an area where they have a gap. Maybe there’s an Amazon play lurking in here with the Amazon + Kohl’s partnership.

    With declining mall traffic and mall reinvention a work in progress, Sephora is going to where the fish are. The question is, are those the fish they should invest in catching? Maybe they had no choice.

    It certainly won’t help J.C. Penney. I am not sure why we are still talking about them. We can only hope someone finds a compelling RTB for JCP.

    1. Lee Peterson Avatar
      Lee Peterson

      Right there with you, Raj.

  5. Carol Spieckerman Avatar
    Carol Spieckerman

    I’ve been saying for a while that brand ubiquity is the new exclusivity – brands have never been freer to roam. Yet Sephora’s decision to dance with J.C. Penney’s direct competitor has to hurt. This will further ding J.C. Penney’s differentiation and offer a big bonus to Kohl’s which, under Ms. Gass’ leadership, has benefited from unlikely frenemy forays (a la Amazon). Sephora’s move to Kohl’s drives a very big nail into J.C. Penney’s prospects and will further differentiate Kohl’s in the scary middle of retail.

  6. Lee Peterson Avatar
    Lee Peterson

    Well, better than being in a J.C. Penney, which falls under the category of “what were you thinking?!” — BUT I still see this as a win-meh. Win for Kohl’s, meh for Sephora. For obvious reasons, LVMH is looking to take Sephora mass and, given the landscape, they see Kohl’s as the vehicle to transport them. But Target and their slightly hipper customer seems like a much better brand fit for that adventure, even from a physical look and feel perspective. Perhaps after Kohl’s sinks a little more, Target will be next in line. Seems like LVMH needs to understand the U.S. market in further depth.

    1. Dick Seesel Avatar
      Dick Seesel

      Lee, Target recently announced a similar collaboration with Ulta so I don’t think Sephora is in the cards for them anytime soon.

      1. Lee Peterson Avatar
        Lee Peterson

        Right! My bad — that’s the win-win in my book!

  7. Dick Seesel Avatar
    Dick Seesel

    Sephora was a rare bright spot for J.C. Penney, even during its toughest days, so this is a blow even though the two companies already agreed to part company. Between Sephora at Kohl’s and Ulta at Target, it’s hard to imagine J.C. Penney finding a suitable beauty partner. Penney’s road to recovery just got harder.

    As to Kohl’s (where I bought and then merchandised beauty from 1982 to 2006), this will be a big win — just as it was for J.C. Penney in the first place. Kohl’s has made inroads in recent years, after the re-introduction of beauty in 2004, but this will take the footprint (space, staffing, content) to a whole new level.

    It will be interesting to see if the traditional department store brands inside Sephora (Clinique, Lancome, etc.) will be part of the Kohl’s assortments, and also to see how the Sephora business aligns with Kohl’s promotional posture. But it’s a big deal!

  8. Gary Sankary Avatar
    Gary Sankary

    As discussed in the space before, J.C. Penney’s challenges are significant. This action by Sephora certainly doesn’t help one bit. Where J.C. Penney is today, this is one more in a long list of problems that will impede their recovery.

    From Sephora’s perspective this is a good move. After Ulta’s announcement a few weeks ago regarding their partnership with Target, I’m sure they were looking for partners to extend their brand. One of the important trends that has emerged during the pandemic has been consolidation of shopping trips by consumers, this certainly addresses that. Brands that are complimentary have much to gain from these sorts of partnerships.

    The bigger question in my mind is, how complimentary exactly are Sephora and Kohl’s? I don’t see them as well aligned as Target and Ulta, which makes me wonder a bit about the long term viability of this relationship.

  9. Dave Wendland Avatar
    Dave Wendland

    For those familiar with my previous posts, I’m a HUGE fan of collaboration and unique “mash-ups.” That said, I believe this partnership has the ingredients to be a win-win. Kohl’s is definitely under-developed in beauty and Sephora needs to move beyond the weight of JCP. The challenge, as with any collaboration, is sharing a vision and executing. This is relatively new territory for Kohl’s and they are following on the heels of an announcement by Target/Ulta which seems to be poised for a big splash.

    On paper the Kohl’s/Sephora union appears solid (customers win, Sephora gains reach, and Kohl’s moves into a new, invigorating category). Execution will be the deciding factor on whether this is a brilliant move or if it fails to live up to expectations.

  10. Lisa Goller Avatar
    Lisa Goller

    Sephora’s trading up and giving Kohl’s a makeover as a competitive beauty destination.

    Sephora wins because Kohl’s is a safer bet for a long-term, lucrative partnership than the beleaguered J.C. Penney. The beauty giant gains national reach to get closer to more consumers. The store-within-a-store model reduces risks and costs compared to opening more standalone Sephora stores as mall traffic declines. Sephora’s in good company. Kohl’s attracted Amazon as a strategic partner for grocery and easy returns, hinting at Kohl’s long-term longevity.

    Meanwhile, partnering with Sephora invigorates the Kohl’s brand among its core audience, women in their 30s and 40s. This partnership gives Kohl’s an exciting beauty edge to compete against the new tag team of Target and Ulta. Also, omnichannel integration will expose Kohl’s to Sephora’s e-commerce excellence, which is vital to thrive during this digital decade.

    1. Dave Wendland Avatar
      Dave Wendland

      I agree 100 percent, Lisa. I like the way you describe this as a trade-up and a beauty destination.

  11. Gene Detroyer Avatar
    Gene Detroyer

    This is hardly transformative. As I similarly wrote regarding Target and Ulta, it strikes me as a nice idea with little or no downside. It will be a convenience at times for the Kohl’s shopper, but not likely a cosmetics destination. If one is not already planning to go to Kohl’s, the alternatives — Ulta, Blue Mercury, and even other Sephora stores, not to mention online — would be considerably more convenient.

    As far as Sephora’s relationship with J.C. Penney — worthless. Sephora is smart to move on.

  12. Di Di Chan Avatar
    Di Di Chan

    Kohl’s has been making big moves to enhance their brands by bringing more younger shoppers into their stores. Adding to their partnership with Amazon, Aldi, Planet Fitness, and Fanatics, their latest collaboration with Sephora will continue to upgrade Kohl’s attractions. Sephora’s new home with Kohl’s will benefit both companies. Sephora is already an attraction magnet that brings in many shoppers to the stores. Kohl’s makeover and new partnerships will benefit Sephora through enhanced brand associations and more relevant shoppers too. Along with the brands and product offering updates, I also anticipate an in-store technological makeover in the next few years as they experiment with the future mall.

  13. Ricardo Belmar Avatar
    Ricardo Belmar

    A few weeks back, Kohl’s CEO stated their goal of tripling their sales in health and beauty – this partnership with Sephora is a giant leap in that direction! Shortly after Target announced their arrangement with Ulta Beauty, discussion emerged in Twitter circles about how Sephora would respond. My prediction was that Kohl’s would move quickly to grab Sephora away from J.C. Penney. Sephora already wanted out of that relationship and when they look to other big box stores to partner with, who would give them the best locations – ideally off-mall and able to compete with Ulta? Kohl’s of course!

    This is a great marriage for both parties. Kohl’s needed to bring in customers interested in buying rather than returning Amazon purchases and their own apparel mix just isn’t enough any longer. For Sephora, this brings them out of the mall giving customers easier access to stores and puts them squarely within reach of Ulta customers. A great competitive move for them.

    Finally, there’s no question this will hurt J.C. Penney. Sephora was one of the lingering reasons consumers came to their stores. This will significantly weaken the J.C. Penney story in health and beauty so they will need to make serious investments in that category to compensate along with rationalizing and improving their apparel assortments.

  14. Natalie Walkley Avatar
    Natalie Walkley

    While an interesting collaboration, it seems like two different target audiences (other than the obvious factor of gender). Kohl’s retail model has a focus on deals, Kohl’s cash, and discounts. Meanwhile, the average Sephora shopper spends ~$33/month on cosmetics (more than Ulta shoppers). I wonder if more price-sensitive Kohl’s shoppers will mosey to the Sephora counter, or if Sephora loyalists will meander through the Kohl’s store while purchasing their cosmetics. Only time will tell.

  15. Ken Morris Avatar
    Ken Morris

    I think this is a bonus for both Kohl’s and Sephora. This partnership generates traffic and additional sales to Kohl’s as once people are in the store they generally buy other products. It also drives a younger demographic to Kohl’s and makes it a destination shopping experience. Sephora benefits from the over 65 million potentially new customers, the cross shopping and the digital integration. This will hurt the J.C. Penney turnaround but it is certainly the best move for both Kohl’s and Sephora.

  16. storewanderer Avatar
    storewanderer

    If being inside J.C. Penney was something Sephora was comfortable with (especially considering some of these very same locations had an in-line mall Sephora in the same mall) and happy with the results, I am sure being inside the higher traffic Kohl’s locations, very few of which are even in malls, is something Sephora will be happy with.

    Kohl’s beauty category has been a total fail, so this also provides a solution for that.

    I didn’t really think the J.C. Penney customer was the Sephora customer either, or that Sephora fit into the image there … same thoughts regarding Kohl’s in regards to that. But given Sephora has been at J.C. Penney, they know the results of setting up shop in a promotion-focused department store that caters to a middle class at best shopper, and they must be happy with those results.

  17. Craig Sundstrom Avatar
    Craig Sundstrom

    I think “transformational for the two retailers” is the right idea, I’m just not sure it’s the right two retailers we’re asking about. Translation: my concern is it will hurt JCP and implicitly Sephora more than it will help Kohl’s.

    Cosmetics have always been a main drawing point in “traditional” department stores — at least visually; it’s the first thing you see when you walk in — and for those of us who (still) see Penney’s as one, much more than Kohl’s, this idea probably seems counterintuitive. And of course the former has far more mall based stores, so Sephora can attract people who are simply “shopping,” as opposed going to a specific store. Time will tell if my concerns are valid.

    As for how much JCP will be hurt: would it have mattered much if the Titanic had 19 lifeboats rather than 20? Well, it certainly wouldn’t have helped.

  18. Brandon Rael Avatar
    Brandon Rael

    The clear winner in this collaboration is Kohl’s, who will benefit significantly from the increased interest and store/digital traffic with the Sephora store-within-a-store concept. While this conceptually is far from a new strategy, Kohl’s is in deep competition with Target and other retailers to increase their share of the consumers’ wallets.

    The health, wellness, and beauty sectors are thriving, especially during the COVID-19 pandemic. In an unsustainable alliance with J.C. Penney, Sephora also gains an advantage over Ulta by increasing their physical presence, without the associated significant store capital investments and long-term leases.

    From Kohl’s perspective, adding ancillary services and new product offerings will help drive their one-stop-shop initiatives. It will be interesting to see how this partnership plays out.

  19. Bob Phibbs Avatar
    Bob Phibbs

    Another reason I continue to question the abilities of the current team at JCP

  20. David Adelman Avatar
    David Adelman

    The middle class that department stores appeal to is crumbling. Is this the right demographic for Sephora? If they wish to grow with the resurgence of Gen X and Gen Z shoppers after the pandemic, I think not.

    As well, time will tell if Kohl’s staff trained by Sephora will continue to provide the same customer experience as stand-alone branded stores. I’m afraid that Sephora might just become another beauty boutique brand like Clinique or L’Oreal inside a department store.

    The biggest question still remaining will be to see if Kohl’s can adapt to today’s new consumer while maintaining its large footprint as department stores continue to struggle.

    I give the advantage to Kohl’s on this marriage.

25 Comments
Oldest
Newest Most Voted
Inline Feedbacks
View all comments
Neil Saunders
Neil Saunders
Noble Member
2 years ago

Kohl’s needs to become less reliant on apparel and find other categories to boost its growth. Beauty is an area where Kohl’s is currently underdeveloped so it doesn’t capture much spend from shoppers who are already in its stores. Adding a Sephora automatically resolves this issue and it also makes Kohl’s a more interesting destination which may help to drive foot traffic.

From Sephora’s perspective, Kohl’s provides access to many locations where Sephora is currently underrepresented and will help widen the audience somewhat. At a time when J.C. Penney is struggling, Kohl’s provides a new partner that will help to offset the closure of many J.C. Penney stores.

5
Dick Seesel
Dick Seesel
Active Member
Reply to  Neil Saunders
2 years ago

You’re right about women’s apparel, which Kohl’s has already promised to edit. The growth of women’s active at Kohl’s came at the expense of floor space in misses’ and juniors’ apparel, but a 2500-square foot Sephora shop will require a more cold-eyed look at these businesses.

1
Adrian Weidmann
Adrian Weidmann
Member
2 years ago

Sephora has become a shopping destination magnet and anywhere they open their umbrella is going to be beneficial for those in close proximity. Having both Sephora and Amazon under their roof makes Kohl’s a winning brick-and-mortar retailer. I would suggest they add a UPS counter to that mix and their stores will become a very powerful ecosystem.

4
Dave Bruno
Dave Bruno
Member
2 years ago

I wish Kohl’s and Sephora luck with this partnership, as I believe these types of “collaborative selling spaces” are critical to the future of retail. The opportunities to share spaces, customers, and marketing investments are all bottom-line wins. What will determine if they are top-line wins is the degree of overlap in key customer segments. While I am not certain that the most important Kohl’s segments are 100 percent aligned with the most important Sephora segments, they are certainly better aligned than the key Sephora and J.C. Penney segments. We should watch this space carefully, as Kohl’s has been a bit of a pioneer for collaborative selling spaces (e.g. Amazon returns), and it could be a bellwether for this model in the future.

3
Raj B. Shroff
Raj B. Shroff
Member
2 years ago

This seems an odd partnership in my view. From a brand perspective, Sephora does so many things well whereas Kohl’s is neutral at best. Kohl’s seems like the place brands go to become vanilla. Sephora will gain access to a large shopper base and Kohl’s will elevate an area where they have a gap. Maybe there’s an Amazon play lurking in here with the Amazon + Kohl’s partnership.

With declining mall traffic and mall reinvention a work in progress, Sephora is going to where the fish are. The question is, are those the fish they should invest in catching? Maybe they had no choice.

It certainly won’t help J.C. Penney. I am not sure why we are still talking about them. We can only hope someone finds a compelling RTB for JCP.

4
Lee Peterson
Lee Peterson
Member
Reply to  Raj B. Shroff
2 years ago

Right there with you, Raj.

0
Carol Spieckerman
Carol Spieckerman
Active Member
2 years ago

I’ve been saying for a while that brand ubiquity is the new exclusivity – brands have never been freer to roam. Yet Sephora’s decision to dance with J.C. Penney’s direct competitor has to hurt. This will further ding J.C. Penney’s differentiation and offer a big bonus to Kohl’s which, under Ms. Gass’ leadership, has benefited from unlikely frenemy forays (a la Amazon). Sephora’s move to Kohl’s drives a very big nail into J.C. Penney’s prospects and will further differentiate Kohl’s in the scary middle of retail.

4
Lee Peterson
Lee Peterson
Member
2 years ago

Well, better than being in a J.C. Penney, which falls under the category of “what were you thinking?!” — BUT I still see this as a win-meh. Win for Kohl’s, meh for Sephora. For obvious reasons, LVMH is looking to take Sephora mass and, given the landscape, they see Kohl’s as the vehicle to transport them. But Target and their slightly hipper customer seems like a much better brand fit for that adventure, even from a physical look and feel perspective. Perhaps after Kohl’s sinks a little more, Target will be next in line. Seems like LVMH needs to understand the U.S. market in further depth.

2
Dick Seesel
Dick Seesel
Active Member
Reply to  Lee Peterson
2 years ago

Lee, Target recently announced a similar collaboration with Ulta so I don’t think Sephora is in the cards for them anytime soon.

3
Lee Peterson
Lee Peterson
Member
Reply to  Dick Seesel
2 years ago

Right! My bad — that’s the win-win in my book!

0
Dick Seesel
Dick Seesel
Active Member
2 years ago

Sephora was a rare bright spot for J.C. Penney, even during its toughest days, so this is a blow even though the two companies already agreed to part company. Between Sephora at Kohl’s and Ulta at Target, it’s hard to imagine J.C. Penney finding a suitable beauty partner. Penney’s road to recovery just got harder.

As to Kohl’s (where I bought and then merchandised beauty from 1982 to 2006), this will be a big win — just as it was for J.C. Penney in the first place. Kohl’s has made inroads in recent years, after the re-introduction of beauty in 2004, but this will take the footprint (space, staffing, content) to a whole new level.

It will be interesting to see if the traditional department store brands inside Sephora (Clinique, Lancome, etc.) will be part of the Kohl’s assortments, and also to see how the Sephora business aligns with Kohl’s promotional posture. But it’s a big deal!

1
Gary Sankary
Gary Sankary
Active Member
2 years ago

As discussed in the space before, J.C. Penney’s challenges are significant. This action by Sephora certainly doesn’t help one bit. Where J.C. Penney is today, this is one more in a long list of problems that will impede their recovery.

From Sephora’s perspective this is a good move. After Ulta’s announcement a few weeks ago regarding their partnership with Target, I’m sure they were looking for partners to extend their brand. One of the important trends that has emerged during the pandemic has been consolidation of shopping trips by consumers, this certainly addresses that. Brands that are complimentary have much to gain from these sorts of partnerships.

The bigger question in my mind is, how complimentary exactly are Sephora and Kohl’s? I don’t see them as well aligned as Target and Ulta, which makes me wonder a bit about the long term viability of this relationship.

2
Dave Wendland
Dave Wendland
Member
2 years ago

For those familiar with my previous posts, I’m a HUGE fan of collaboration and unique “mash-ups.” That said, I believe this partnership has the ingredients to be a win-win. Kohl’s is definitely under-developed in beauty and Sephora needs to move beyond the weight of JCP. The challenge, as with any collaboration, is sharing a vision and executing. This is relatively new territory for Kohl’s and they are following on the heels of an announcement by Target/Ulta which seems to be poised for a big splash.

On paper the Kohl’s/Sephora union appears solid (customers win, Sephora gains reach, and Kohl’s moves into a new, invigorating category). Execution will be the deciding factor on whether this is a brilliant move or if it fails to live up to expectations.

1
Lisa Goller
Lisa Goller
Active Member
2 years ago

Sephora’s trading up and giving Kohl’s a makeover as a competitive beauty destination.

Sephora wins because Kohl’s is a safer bet for a long-term, lucrative partnership than the beleaguered J.C. Penney. The beauty giant gains national reach to get closer to more consumers. The store-within-a-store model reduces risks and costs compared to opening more standalone Sephora stores as mall traffic declines. Sephora’s in good company. Kohl’s attracted Amazon as a strategic partner for grocery and easy returns, hinting at Kohl’s long-term longevity.

Meanwhile, partnering with Sephora invigorates the Kohl’s brand among its core audience, women in their 30s and 40s. This partnership gives Kohl’s an exciting beauty edge to compete against the new tag team of Target and Ulta. Also, omnichannel integration will expose Kohl’s to Sephora’s e-commerce excellence, which is vital to thrive during this digital decade.

2
Dave Wendland
Dave Wendland
Member
Reply to  Lisa Goller
2 years ago

I agree 100 percent, Lisa. I like the way you describe this as a trade-up and a beauty destination.

1
Gene Detroyer
Gene Detroyer
Trusted Member
2 years ago

This is hardly transformative. As I similarly wrote regarding Target and Ulta, it strikes me as a nice idea with little or no downside. It will be a convenience at times for the Kohl’s shopper, but not likely a cosmetics destination. If one is not already planning to go to Kohl’s, the alternatives — Ulta, Blue Mercury, and even other Sephora stores, not to mention online — would be considerably more convenient.

As far as Sephora’s relationship with J.C. Penney — worthless. Sephora is smart to move on.

0
Di Di Chan
Di Di Chan
Member
2 years ago

Kohl’s has been making big moves to enhance their brands by bringing more younger shoppers into their stores. Adding to their partnership with Amazon, Aldi, Planet Fitness, and Fanatics, their latest collaboration with Sephora will continue to upgrade Kohl’s attractions. Sephora’s new home with Kohl’s will benefit both companies. Sephora is already an attraction magnet that brings in many shoppers to the stores. Kohl’s makeover and new partnerships will benefit Sephora through enhanced brand associations and more relevant shoppers too. Along with the brands and product offering updates, I also anticipate an in-store technological makeover in the next few years as they experiment with the future mall.

0
Ricardo Belmar
Ricardo Belmar
Active Member
2 years ago

A few weeks back, Kohl’s CEO stated their goal of tripling their sales in health and beauty – this partnership with Sephora is a giant leap in that direction! Shortly after Target announced their arrangement with Ulta Beauty, discussion emerged in Twitter circles about how Sephora would respond. My prediction was that Kohl’s would move quickly to grab Sephora away from J.C. Penney. Sephora already wanted out of that relationship and when they look to other big box stores to partner with, who would give them the best locations – ideally off-mall and able to compete with Ulta? Kohl’s of course!

This is a great marriage for both parties. Kohl’s needed to bring in customers interested in buying rather than returning Amazon purchases and their own apparel mix just isn’t enough any longer. For Sephora, this brings them out of the mall giving customers easier access to stores and puts them squarely within reach of Ulta customers. A great competitive move for them.

Finally, there’s no question this will hurt J.C. Penney. Sephora was one of the lingering reasons consumers came to their stores. This will significantly weaken the J.C. Penney story in health and beauty so they will need to make serious investments in that category to compensate along with rationalizing and improving their apparel assortments.

2
Natalie Walkley
Natalie Walkley
2 years ago

While an interesting collaboration, it seems like two different target audiences (other than the obvious factor of gender). Kohl’s retail model has a focus on deals, Kohl’s cash, and discounts. Meanwhile, the average Sephora shopper spends ~$33/month on cosmetics (more than Ulta shoppers). I wonder if more price-sensitive Kohl’s shoppers will mosey to the Sephora counter, or if Sephora loyalists will meander through the Kohl’s store while purchasing their cosmetics. Only time will tell.

2
Ken Morris
Ken Morris
Active Member
2 years ago

I think this is a bonus for both Kohl’s and Sephora. This partnership generates traffic and additional sales to Kohl’s as once people are in the store they generally buy other products. It also drives a younger demographic to Kohl’s and makes it a destination shopping experience. Sephora benefits from the over 65 million potentially new customers, the cross shopping and the digital integration. This will hurt the J.C. Penney turnaround but it is certainly the best move for both Kohl’s and Sephora.

0
storewanderer
storewanderer
Member
2 years ago

If being inside J.C. Penney was something Sephora was comfortable with (especially considering some of these very same locations had an in-line mall Sephora in the same mall) and happy with the results, I am sure being inside the higher traffic Kohl’s locations, very few of which are even in malls, is something Sephora will be happy with.

Kohl’s beauty category has been a total fail, so this also provides a solution for that.

I didn’t really think the J.C. Penney customer was the Sephora customer either, or that Sephora fit into the image there … same thoughts regarding Kohl’s in regards to that. But given Sephora has been at J.C. Penney, they know the results of setting up shop in a promotion-focused department store that caters to a middle class at best shopper, and they must be happy with those results.

0
Craig Sundstrom
Craig Sundstrom
Active Member
2 years ago

I think “transformational for the two retailers” is the right idea, I’m just not sure it’s the right two retailers we’re asking about. Translation: my concern is it will hurt JCP and implicitly Sephora more than it will help Kohl’s.

Cosmetics have always been a main drawing point in “traditional” department stores — at least visually; it’s the first thing you see when you walk in — and for those of us who (still) see Penney’s as one, much more than Kohl’s, this idea probably seems counterintuitive. And of course the former has far more mall based stores, so Sephora can attract people who are simply “shopping,” as opposed going to a specific store. Time will tell if my concerns are valid.

As for how much JCP will be hurt: would it have mattered much if the Titanic had 19 lifeboats rather than 20? Well, it certainly wouldn’t have helped.

0
Brandon Rael
Brandon Rael
Active Member
2 years ago

The clear winner in this collaboration is Kohl’s, who will benefit significantly from the increased interest and store/digital traffic with the Sephora store-within-a-store concept. While this conceptually is far from a new strategy, Kohl’s is in deep competition with Target and other retailers to increase their share of the consumers’ wallets.

The health, wellness, and beauty sectors are thriving, especially during the COVID-19 pandemic. In an unsustainable alliance with J.C. Penney, Sephora also gains an advantage over Ulta by increasing their physical presence, without the associated significant store capital investments and long-term leases.

From Kohl’s perspective, adding ancillary services and new product offerings will help drive their one-stop-shop initiatives. It will be interesting to see how this partnership plays out.

0
Bob Phibbs
Bob Phibbs
Active Member
2 years ago

Another reason I continue to question the abilities of the current team at JCP

0
David Adelman
David Adelman
2 years ago

The middle class that department stores appeal to is crumbling. Is this the right demographic for Sephora? If they wish to grow with the resurgence of Gen X and Gen Z shoppers after the pandemic, I think not.

As well, time will tell if Kohl’s staff trained by Sephora will continue to provide the same customer experience as stand-alone branded stores. I’m afraid that Sephora might just become another beauty boutique brand like Clinique or L’Oreal inside a department store.

The biggest question still remaining will be to see if Kohl’s can adapt to today’s new consumer while maintaining its large footprint as department stores continue to struggle.

I give the advantage to Kohl’s on this marriage.

0