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Kohl's grows third-party marketplace following pilot phase

The retailer is also working to expand its retail media network.

Kohl's grows third-party marketplace following pilot phase

Kohl's marketplace. (Courtesy photo)

Kohl’s is making more items available on its marketplace as the department store retailer seeks to drive digital growth.

The news: Kohl’s is moving its marketplace out of pilot mode. With the official launch following what it called a "successful" test period, the retailer is adding more items to the assortment of thousands of items from third-party marketplaces.

What’s available? Kohl’s said it is opening the marketplace to sellers in all years. In particular, it is looking to emphasize the following categories:

  • Apparel & Accessories: Men’s, women’s, kids, bags, backpacks, sunglasses, gloves, hats & scarves
  • Sports & Fitness: Exercise equipment, sporting goods, health & wellness
  • Pet Supplies: Beds & furniture, bowls & feeders, toys
  • Home: Furniture, kitchen, home decor, patio & garden
  • Toys: Baby, kids & toddler, backyard fun
  • Baby gear: Furniture, carriers & strollers, health & cleaning
  • Electronics: Computers, computer accessories, gaming consoles, mobile accessories

How are they identified? On its ecommerce store, Kohl’s denotes marketplace items with a badge. Items are shipped directly from sellers.

Key quote: On the company’s Q4 earnings call, Kohl’s CEO Tom Kingsbury talked about the retailer’s push to grow a digital business that accounts for 30% of sales. “Two of our key digital growth initiatives include expanding Kohl's Marketplace and Kohl's media network," Kingsbury said. "Kohl's Marketplace is broadening our product offering online to capture incremental sales opportunities, and Kohl's media network is leveraging our digital platform and site traffic to partner with more of our key brands and capture more advertising dollars.”

Marketplace moment: Kohl’s is the latest retailer to stand up a third-party marketplace in recent months, joining Macy’s and Michaels, among others. Amazon perfected the marketplace model as a means to grow its assortment and in turn drive price advantages. Now, retailers with well-trafficked websites are adopting it across the industry. The marketplace also opens up advertising opportunities. It wasn’t a mistake that Kingsbury talked about Kohl’s marketplace and media network in the same statement. More items on a marketplace will bring more of a desire for brands to stand out. That means they are more likely to buy advertising to improve placement. For Kohl’s the retail media network opens up a high-margin, digital business line that can exist alongside selling physical goods.
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