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Dive Brief:
Kohl’s has introduced “the Deal Bar” to all of its stores, a collection of items priced under $10.
The collection, located at the front of the store, includes gifts, seasonal items and essentials.
Most recently, Kohl’s Deal Bar featured Valentine’s Day and Easter-themed items.
Dive Insight:
Kohl’s has been working on a turnaround for years now, most recently under CEO Michael Bender, who has had the job on a permanent basis since late last year.
The struggling department store saw some progress in Q3, and Evercore ISI analysts led by Michael Binetti speculated in November that Kohl’s “could be a sneaky upside story” in the second half of the year simply because it has been reversing some of the errors it made under previous leadership, including expanding its coupons and private brands.
“We’re encouraged that improvement seems to come from [Kohl’s] simply listening to the consumer, bringing value back,” Binetti said.
Items in the Deal Bar are priced under $10.
Permission granted by Kohl’s
But in the meantime, Kohl’s consumers have been increasingly under pressure financially, according to Gimme Credit Senior Bond Analyst Evan Mann.
“While the department store retailer’s turnaround efforts seem to be benefiting results in the near term, we remain concerned about middle-to-low-income consumer’s constrained discretionary spending as well as declining department store traffic trends over the longer term,” Mann said in a December research note.
The deals bar helps, but probably not enough, Mann told Retail Dive Tuesday.
“I think it is a clever idea that might help spur some impulse buying by in-store shoppers, but I don’t believe it will move the needle in any meaningful way,” Mann said by email. “The big issue still remains a strapped low- and middle-income consumer with limited discretionary income, and I don’t see this trend changing anytime soon.”