• Retail Dive

Kohl's to accept free Amazon returns

Dive Brief:
  • Kohl’s on Tuesday announced that starting next month 82 of its stores in the Los Angeles and Chicago areas will offer free returns for Amazon customers, according to a company press release.

  • Kohl’s will pack and ship eligible Amazon return items at no charge. This, as the holiday season approaches.

  • The move comes just a week after Kohl’s said it will feature a new "Amazon smart home experience" at 10 Kohl’s stores, also in the Los Angeles and Chicago areas, where customers will be able to purchase Amazon devices, accessories, and smart home devices and services directly within 1,000-square-foot zones dedicated to Amazon and staffed by Amazon associates.

Dive Insight:

This latest partnership between Amazon and Kohl’s addresses one of the biggest Amazon pain points — product returns. Many analysts hailed the move, saying Kohl’s will see some benefit as well. "The test … is an intelligent way for Kohl’s to: leverage unutilized parts of its store footprint and help improve frequency (and potentially drive sales higher) in its stores," Gordon Haskett analyst Chuck Grom said in an email to Retail Dive.

That, plus the partnership between Kohl’s and Amazon announced earlier shows how Kohl’s "continues to think outside the box and forward think on how to evolve in today’s quickly changing backdrop," Grom also said.

Jeffries analysts agreed. "Today's announcement of free [Amazon] returns at selected [Kohl’s] doors underscores the forward-looking thought leadership of [Kohl’s management to drive traffic and accommodate shifting consumer preferences," Jeffries wrote in a note emailed to Retail Dive, saying the service would likely spread to more than the initial 82 stores.

It’s not just Kohl’s — there’s an increasing level of collaboration between e-commerce and traditional retailers, as seen in Amazon’s acquisition of Whole Foods, Walmart’s e-commerce acquisition spree, and eBay executive Hal Lawton’s move to Macy’s, Grom said. Even Nordstrom’s experiment with a merchandise-free retail concept is part of that landscape, he noted.

"We continue to observe more and more collaboration between digitally native companies and traditional retailers – a theme that we think will continue to build momentum in the coming quarters," Grom said.

That’s in part because, while traditional retailers want to grab back some share from e-commerce, physical stores are still necessary, according to Jeffries. “While it's clear that stores now need to embrace an omnichannel world through digital growth, we believe this move highlights the value that stores bring to consumers,” Jeffries said. "We expect this to become increasingly clear in time, and view the best positioned retailers as those who successfully merge the o