Customer relationships.? Easy self-service onlineThe Kohl’s website is specifically designed to make theshopping online experience as easy as possible. The mobile app is alsodesigned, to give the customers the opportunity to shop anywhere.? Personalized assistanceWhen needed, customers can benefit from the service ofpersonal assistance offered in the physical stores.
1? Customer careOn the website design for customers there is sectionavailable that describes and answer most frequent questions. There is also ahelpline available.5. Customer segments? Men and women over 35, childrenAt Kohl’s, the targeted demographics are wide. On thewebsite there are offered products for women, men and children. Those are thecore customers at Kohl’s, and they bring the most revenue to the company.
2? MillennialsMillennials is a secondary target group, at the momentKohl’s is experiencing issues with those customers, since the sales within thistarget market considerably decreased.36. Key resources.? Intellectual property and brandsOne of the main key resources ofKohl’s are the brands that are some merchandised to the shop, and some that aredesigned particularly for Kohl’s (intellectual property).? Real estates that is leased and ownedAn important aspect, is that allKohl’s stores have almost the same size, a perfect prototype store is usually88,000 gross square feet of retail space and serves trade areas of 150,000 to200,000 people.
4412 stores are owned and 505 are leased.5? Online platformsAccording to the corporate website,the online website for customers offers everything that the customers want andeven more, with the help of the app online shopping became even moreaccessible. ? Supply chainConsists of an important resource,since without being supplied with all the necessary merchandise and otherattributes, the business would not exist.? PersonnelHaving physical stores, implies theimportance of having staff that will assist clients when needed. 7.
Channels? Consumer websiteIs designed to bring the shoppingcloser to customers, by offering even wider variety of products that can befound in stores.? Corporate websiteA website designed to providecorporate information to investors and all stakeholders and shareholders. Itdescribes company’s activities, strategies and goals.
? Physical storesBeing a player in retail industry,physical stores is an important channel to get customers.? Mobile app”Shop on the go” is a newly createdand constantly renovated channel that was created as a response to the changingcustomer needs.8. Cost Structure? Space leaseAlmost half of the stores areleased. This consists one of the costs that the company encounters. The companyhas to constantly invest and spend money on the space in order to exist.? Human ResourcesEmployees, that are aimed to supportthe customers and to help them are important aspect for investment, employeesneed to be trained and happy in order to provide high quality service. As ofJanuary 2017, at Kohl’s are employed 138,000 associates, includingapproximately 32,000 full time and 106,000 part-time associates.
6The number of associates varies during the year, peaking during the back- to-school and holiday seasons.7? Product developmentBecause there are some of theproducts that are available exclusively at Kohl’s, obviously, a certain amountof money is spent on product design and development.? Administrative expensesExpenses that can’t be avoided whenhaving physical stores. Managing the space and the equipment requiresconsiderable amount of money.9. Revenue streams? Sales of apparel and accessoriesThe one and only source for revenueat Kohl’s is the sales fee on the offered merchandise. In 2017, Kohl’s grossprofit is 6.74B.
84. Porter’s fiveforces. Rivalry among existing competitors.Retail industry can be consideredcompetitive. Because the customer needs and wants are constantly stimulated bymarketing and advertising, more and more retailers are opening stores and arefighting for market share by trying to offer differentiated value to customers.
The retail industry became recently even more intense, because of the new wayof buying – online. Bargaining power of buyers.’In retail, buyers can be consideredpowerful, since they would constantly seek to buy better products and spentless money as possible. This also becomes more possible because customers havethe opportunity to go to different retailers and evaluate the price qualityrelation.
Moreover, most of the retailers, display their offerings and pricesonline, therefore, it is even easier for customers to seek better deals. Thiscan put considerable pressure on Kohl’s income and sustainability. Bargaining power of suppliers.
Kohl’s business is fully based onits suppliers and vendors. In this situation, suppliers are powerful, becausethey offer the unique merchandise that is crucial for Kohl’s value proposition.By being powerful, suppliers can change the terms and conditions, increasedprice of merchandise would influence Kohl’s profit margins in a negative way. Threat of new entrants.
Even though the barriers are high,since it is not easy to open a new retail store, create a network of suppliers,the threat of new entrants is still high. Within the retail industry, customerneeds are constantly changing and evolving, which creates new target segments thatare attractive for the new entrants. Therefore, new retailers are entering themarket with innovative products and services, thus creating more and morechallenges for Kohl’s to overcome the issues and to stay competitive. Threat of substitutes.Because Kohl’s offers apparel,accessories and home products, those can be easily substituted by other retailer’sofferings. However, in case of Kohl’s, since the products they offer aredifferentiated, they can avoid a certain amount of pressure from thesubstitutes.5.
Strategic group mapIn order to identify which companieswithin the industry are closest rivals for Kohl’s, the Strategic Group Map wasdeveloped. 9 For this section, competitors were selectedbased on two factors: merchandise range and net income, both, online and instores. Since many activities at Kohl’s are currently oriented to create apleasant online shopping environment, it is crucial to identify the onlinesales success of it’s competitors. Therefore,key competitors are: Amazon Macy’s Costco Target1 Annual report2 Goodfellow, Pam. “Kohl’s Has A MillennialProblem.” Forbes, Forbes Magazine, 25 Feb.
2016,www.forbes.com/sites/forbesinsights/2016/02/24/kohls-has-a-millennial-problem/#6eafb0c7424a3 Goodfellow, Pam. “Kohl’s Has A MillennialProblem.” Forbes, Forbes Magazine, 25 Feb. 2016,www.
forbes.com/sites/forbesinsights/2016/02/24/kohls-has-a-millennial-problem/#6eafb0c7424a.4 Annual report5 Annual report6 Annual report7 Annual report8 “Kohl’s income-Statement 2017.” Amigobulls.com,amigobulls.com/stocks/KSS/income-statement/annual.9 Thompson, Arthur A., A.
J. Strickland, andJohn Gamble. Crafting and Executing Strategy: The Quest for CompetitiveAdvantage: Concepts and Cases. Boston: McGraw-Hill/Irwin, 2008. 126. Print.