Dive Brief:
- Kohl’s on Wednesday revealed the locations of 200 stores that will receive Babies R Us shop-in-shops. They’re slated to start opening in August and continue through the fall in time for the end-of-year holiday shopping season. Kohl’s said the Babies R Us shops will offer “a curated assortment” of baby gear, furniture and accessories.
- The retailer’s existing in-store baby and kids’ apparel offerings will be placed next to the new in-store shops to create “a comprehensive baby shopping experience,” Kohl’s said. The company will also offer an expanded Babies R Us assortment online.
- During Kohl’s most recent earnings call, CEO Tom Kingsbury said baby, home, gifting and impulse purchases are underrepresented categories with a sales opportunity of over $2 billion over the next several years.
Dive Insight:
Kohl’s announced its exclusive partnership plans with WHP Global-owned Babies R Us in March.
The retailer said it wants to position itself as a trusted destination for milestone moments, like shopping for baby basics and accessories. Kohl’s also said it expects the Babies R Us shops to draw first-time, newer and younger customers to its stores. The shops will range from 750 to 2,500 square feet and will open in states including Texas, California, Minnesota, Michigan, Florida and Virginia, among others.
Additionally, Kohl’s will become the exclusive retailer for the Babies R Us at Kohl’s online gift registry. The company said earlier this year that members of its loyalty program will earn rewards on in-store and online Babies R Us purchases. They can also earn and redeem Kohl's Cash on all merchandise during designated events.
Babies R Us is owned by IP and product licensing firm WHP Global, whose portfolio includes Toys R Us and about 10 other brands. WHP and Macy’s also began a partnership a few years ago that brought Toys R Us shops inside Macy’s stores.
The Babies R Us deal builds on other shop-in-shop experiences at Kohl’s, including a partnership with Sephora. Kohl’s first added in-store Sephora shops in 2021. Sephora beauty shops were in about 900 Kohl’s stores at the end of 2023. The retailer plans to continue opening Sephora shops this summer and the entire chain should have them by 2025. Kingsbury said in March that 40% of customers who visit the company’s Sephora in-store shops are new visitors.
After a Q3 that saw declines, the retailer said it would shift its focus back to stores. Kingsbury said in November that while the retailer’s digital business was pushing the company in the wrong direction, he was positive on the outlook for physical stores.
