Kohl’s, like many other companies, recognizes Amazon as the retail powerhouse they are and knows full well they will continue to capture more consumer dollars year over year with their ease of use and product selection. Realizing this, Kohl’s sought out a trial partnership to test whether joining Amazon would give Kohl’s a competitive advantage and keep them relevant in the eyes of their consumers.
Growth Through Partnership
In 2017, Kohl’s began a pilot program in Chicago and Los Angeles that included selling a select set of Amazon products such as the Echo Dot and accepting Amazon returns. What seemed like a simple partnership led Kohl’s to achieve 9% growth in new customers and 8% growth in revenue according to Earnest Research. Compared to the 1% growth in new customers and 2% increase in revenue in the U.S. overall, Kohl’s took this data and expanded the program to 200 stores nationwide. They also expanded their offerings to include all Amazon products, while still allowing any customer to return any Amazon product for free to their store.
The Future of Ecommerce and Brick and Mortar Relationships
So, what does this mean for the future of brick-and-mortar shops like Kohl’s and their relationship to online stores like Amazon? What once was competition, is transforming into a beneficial relationship for both parties involved. Brick-and-mortar brands can offer the expanse of products Amazon capitalizes on while staying relevant in their consumers’ minds. All the while, Amazon can have the brick-and-mortar presence to take advantage of impulse buying while offering consumers even more ease of use and free returns. Research from Radial has shown that 51% of U.S. online buyers said they avoid purchasing goods from online retailers that do not offer free returns. With the benefits on both sides of the relationship, Amazon could help brick-and-mortar stores stay afloat amid the looming declarations that in-store retail is dead.
At The PM Group, we leverage beneficial partnerships between our partners, clients, and non-profits. We know how successful a campaign with a strategic partnership can be, and we can help your brand tap into resources you may never have had access to. Contact us to see how we can help you jump ahead of the competition.
About The PM Group: The PM Group was founded in 1988. Over the past 30 years, the agency has continued to grow and is currently listed as San Antonio’s Largest Advertising Agency by the San Antonio Business Journal. The PM Group’s client roster spans numerous industries including automotive, CPG, entertainment and sports marketing, legal, business services, non-profit, real estate and fitness. In addition, the agency hosts an annual Charity Gala every February that to date has raised over $3 million for local San Antonio area non-profit organizations in the last 15 years! It is our way of giving back to the community that we so humbly serve.