Kohl's CIO Talks Omni-Channel Order Fulfillment, Loyalty
By Erin Harris, Editor-In-Chief, Cell & Gene
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Kohl’s currently operates approximately 1,200 stores in 49 states and has annual sales in excess of $18 billion. The retailer that prides itself on its commitment to family, value, and national brands is in the process of becoming a true omni-channel retailer. Just recently, I had the opportunity to talk to Janet Schalk, EVP and CIO at Kohl's Department Stores, about how the powerhouse retailer is handling omni-channel order fulfillment, loyalty, the customer experience, and more.
How does Kohl’s handle omni-channel order fulfillment?
Schalk: We know that convenience, speed, and accuracy are critical when fulfilling orders. These are the three things we’re striving for with omni-channel fulfillment.
This past holiday season, we piloted “buy online, pick up in store” in about 100 stores. We’ll be rolling that out across the chain by mid-year. We’re really excited about the roll out, as our early results have been very positive. And, to us, buy online, pick up in store is a great convenience for our customer, because she can find something she wants online and pick it up the same day or the next day. Our turnaround time is such that in most cases she should be able to pick up the same day if she chooses.
With regard to speed and accuracy, we have made some foundational changes to our systems that our customers will not see directly; however, these changes ensure that our accuracy is on par or better with the industry. For the speed factor, we’ve leveraged our store network in addition to our four large e-commerce fulfillment centers. We’ve found with that we are able to get orders to customers on average faster than just with our fulfillment network simply because the store network is that much closer to our customers than our fulfillment centers.
What has been the customer response to Kohl’s improvements in omni-channel order fulfillment?
Schalk: The response has been very good. I go online and check what’s happening on social media and it’s all good news from our customers. It’s an informal metric, but it’s certainly one that I review.
What are some of the best practices Kohl’s has crafted to improve fulfillment in general?
Schalk: Some of it is the systems work we’ve put in place. Customers and store associates alike can see everything that’s available to our customer whether it’s in store or on a digital channel. And, again, the changes we’ve made to our systems in the fulfillment centers for the leveraging ship from store and buy online, pick up in store. We continuously track what’s happening in the industry with same-day delivery.
Every retailer strives to improve the customer experience. What are some of the things Kohl’s does well to accommodate the omni-channel customer experience?
Schalk: We are always number two or number three with nationwide industry surveys on customer service. Even though our labor model in the store is very different from Neiman Marcus or Nordstrom’s, for example, it is about convenience. It is about trip assurance. It is about in-stock.
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“Policies and processes are just as important if not more important than our systems when it comes to the good customer experience at Kohl’s. From a technology perspective, we aim to become an omni-channel retailer and become very engaging across all the channels.” Janet Schalk, EVP and CIO at Kohl's Department Stores |
We also have our “yes we can” approach in the stores. Our store associates are very empowered to make things right for our customers no matter the reason.
Policies and processes are just as important if not more important than our systems when it comes to the good customer experience at Kohl’s. From a technology perspective, we aim to become an omni-channel retailer and become very engaging across all the channels.
We’ve made many foundational investments over the last couple of years and will continue to do so this year so that if she’s shopping from home, her cart stays with her across any channel.
We also offer our omni-channel wallet, our mobile wallet, which makes shopping at the store much easier. The customer does not have to fumble for all the pieces of paper — Do I have Kohl’s cash? Do I have a reward? Do I have a 30% off? Customers can simply store these things in their phone wallet.
How has Kohl’s improved its loyalty program?
Schalk: We’ve implemented some of the other foundational technologies from Oracle. We’ve done some of the basic blocking and tackling with the pricing system so that we can be more nimble with pricing strategies than we have in the past, and we’ve modernized our purchase order system.
As we talk about customer centricity and relevancy, our loyalty program, which we’ve been piloting for a couple of years and rolled out prior to last holiday season across the chain, now has 25 million enrollees. Those are customers that we now know more about and can provide relevancy around their interests — whether it’s offers, whether it’s information, or whether it’s other ways to engage with them specifically.