NEW YORK, United States — Kohl’s Corp. aims to turn an e-commerce threat into an ally by offering Amazon.com Inc. products in some of its stores.
The retailer will open 1,000-square-foot Amazon areas in 10 of its locations, offering gadgets like the Echo voice-activated device and the Fire tablet. The new store-in-store concept, dubbed the Amazon Smart Home Experience, will begin appearing next month.
The partnership lets Kohl’s ride Amazon’s coat-tails and provides another way to drive traffic to its brick-and-mortar locations. The broader department-store industry has struggled to maintain sales, and the spectre of customers defecting to Amazon is seen as a major threat. Same-store sales — a closely watched measure — dropped 0.4 percent at Kohl’s last quarter.
News of the tie-up helped send Kohl’s shares up as much as 3.1 percent to $41.63 on Wednesday. The stock had been down 18 percent this year, battered by retail gloom.
For Amazon, the deal offers another distribution channel to support its rapid expansion. The e-commerce giant just completed its purchase of Whole Foods last month, marking its biggest push yet into the brick-and-mortar world. It also is building out a chain of physical bookstores.
The Smart Home Experience will be offered at Kohl’s stores in the Los Angeles and Chicago areas, aiming to be ready in time for holiday shoppers. The idea is to let consumers test out the products — including devices powered by Amazon’s voice assistant Alexa — which can be used to manage entertainment, home security and other tasks.
Still, the partnership will be limited to a tiny fraction of Kohl’s chain. The retailer has more than 1,100 department stores in 49 states. Terms of the Amazon deal weren’t disclosed.
By Nick Turner; editors: Nick Turner and Jonathan Roeder.