During the Aug. 15 second-quarter financial earnings call, Kohl’s CEO Kevin Mansell was very candid about his enthusiasm and hopes for the brand’s loyalty rewards pilot program launched in late 2012 that is currently in beta in Texas, and will roll out in California later this year
“The target we have our eye on is all about engaging more customers more broadly,” Mansell said during the question and answer portion of the earnings call. “I'm really excited about the loyalty pilot. The loyalty pilot to me is the future. California is a really important state for us as a company. It has more than 10% of our stores in it. It’s not a state, historically, we’ve been successful in and I think the loyalty program rolling out in California will be a big plus for them.”
Mansell discussed the company’s significant investment in revamping its ecommerce platform, but focused on what he thinks could be a transformative loyalty program. Kohl’s launched the loyalty pilot program in late 2012 with great success.
Kohl’s launched the loyalty pilot in Texas in May and Mansell said the program “accelerated a lot over the original pilot. Naturally, we're now going to go back in the original group of stores and add in the same elements that we've done in Texas.
Kohl's will offer the program in roughly 300 total stores when it goes live in California before making a decision early next year regarding company-wide implementation.
"The program continues to provide significant insight into how our customer shops, and more importantly, how we are better able to influence her shopping behavior," Mansell explained. “We're listening to our customer and modifying that program based on her needs and desires."
Kohl's is already offering a vast amount of percentage-off promotions, dollars-off coupons in the newspaper, and Kohl's cash. But the chain is trying to attract more loyal customers with a new "Kohl’s Rewards" program, which offers customers an additional $5 off for every $100 they spend.
The "Kohl’s Rewards" program debuted in 100 stores last year, expanded to Texas in May, and is scheduled to launch in California later this fall. The test stores comprise about a quarter of Kohl's about 1,200 locations nationwide.
The rewards program offers customers one point for every dollar they spend in store or online. For every 100 points, they get a $5 reward certificate for a future purchase. The threshold for getting rewards was lowered from the initial amount of $125 and could change before a national rollout. The program also offers "extra savings all year long," early notification about upcoming events and sales, and a special birthday coupon by email every year.
“We made a decision to expand our loyalty program to broaden the customer base with access to value-added offers and believe that, long term, this can be an incredibly powerful tool to broaden our reach,” Mansell said. “It’s an important tool in our strategy.”
Total sales at Kohl's rose 2%, to $4.3 billion for the second quarter.