Kohl's Remodel Strategy
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Transcript of Kohl's Remodel Strategy
KOHL’S REMODEL STRATEGY
Mission Statement:
To be the leading family- focused, value- oriented, specialty department store offering quality exclusive and national brand merchandise to the customer in an environment that is convenient, friendly, and exciting.
Summary of Store Visit
Summary: A store visit was conducted at the
beginning of our remodel analysis for Kohl’s to gather ideas for improvement in opportunities to create a better shopping experience for “HER”.
Market Opportunity Analysis: Update the design and layout
on the dressing rooms The plan is to make it more
chic and comfortable feeling Update lighting
Cost effective LED lights Trendy and promote more sales
Trend Concept
Relocate and remodel the current dressing rooms ONE centralized dressing room towards back of store
Extend length of doors/walls Increase room size Add upholstered seating Eliminate carpet Utilize new low- wattage lighting
Online computer system with scanners Two located in new location Touch screen Connected to kohls.com
Recommendations
*Waiting area seating with wall art, labeled sign into the entrance, continuous flooring into the dressing room from the navigable path from throughout the store, doors and walls flushed with floor and up to 7’ high, floor length mirrors, solid wood doors, and in a centralized location.
Store layout
*Layout for the 88,000 sq ft prototype stores.
* Suggested space allocated at least 10% of stores square footage
•*Displays the allocated space for each department area, cash registers, restroom/guest services, the front entrances, the navigable path around the store, and the new remodel plan for the centralized dressing room.
Dressing Room Floor Plan
Insert prototype
Trend Concept Benefits
“Customers who use a fitting room are 71% more likely to buy than those simply browsing the sales floor.”
More space throughout for store display
New feeling of comfort and cleanliness
Better clothing appearance Reduced energy costs Fewer sales lost Increase gross margins Fewer disappointed customers Frequent exposure to Kohls.com
Justification
Place where majority of buying decisions are made
Not on directional map Relatively cramped Place where customers
feel most vulnerable Help maintain a
comfortable home like atmosphere
Help make the buying decision easier
Demographics
Lewisville area: 49.6% males 50.4% females Median income level: $50,000- $74,999
Lewisville and Valley Ranch: Boomtown Singles Young Influentials
Industry Analysis
Industry trends: Use of technology
RFIDs Estimated for 2015, 73% growth of usage by
customers, but only 23% intend to use the technology.
Scanners “Magic Mirror”
Additional space Change ambience
Competitor Analysis
High- end to low- end stores Examples: Nordstrom, Macy’s, TJ Maxx
2007 recession Company’s total revenues topped $17.2
billion in 2009, a 4.8% increase from previous year
Advantages
SWOT Analysis
Strengths Weaknesses
Opportunities Threats
Finance Projections
The Suburban Prototype (88,000 sq. ft) brings in about $16 million in sales. (est. $182 per square foot)
Past Sales 2003 to 2008 there was a
60% increase in sales $10.3 billion to $16.4 billion
In 2008, there was a .5% decrease in sales due to economic recession
Gross Margin Larger margin on clothing Remodeled dressing rooms
lead to more sales
Costs Cut costs on construction Projected remodel time reduced Centralization reduces décor costs
Store remodel budget $3 million Estimated BUDGET TO BE USED
for the remodel is $1.5 million After remodel, sales planned to
continue to grow. Technology bring in additional
sales Additional sales of $100,000 per
store per year, which equals 0.5% of total average store sales of $20 million. Based on 1,000 stores this would equal $100 million.
Adding kiosks increases productivity and customer satisfaction by 90%
Measurable Performance
Objectives Provide a better shopping
experience Reduce remodel cost and
time Continued focus on future Create a centralized area
Goals Clean up merchandise
clutter Introduce technology Environment for the
customers to feel at home
Completed
Remodel
Month 3 Month 2
Month 1Finalize
Remodel
Promotional Strategy
In-store marketing Marketing slogan
“More space for “HER”” Letting Kohl’s customers know about the
new dressing room location and how it will better their shopping experience Asking her to try out the new renovations