13 April 2023
The Weekly
United States

The strategic partnership between Sephora and Kohl's continues to pick up traction, seeing incremental increases in sales, traffic, new customer acquisition, and highly accretive operating margins. Kohl's expects to see a significant return on this investment with an expected payback period of under 3.5 years. 8 million Kohl’s customers purchased beauty products, while roughly 50% of Sephora at Kohl’s baskets had an additional category purchase. In Q4 2022, total beauty category sales increased 90% for Kohl’s, achieving high-single-digits percent comparable beauty sales growth in the 200 Sephora shops that opened in 2021, and better than expected beauty sales in the 400 shops opened in 2022, with continued solid sales growth on Kohls.com.

Kohl’s recently announced the 250 stores that would add full-sized, 2,500 sq ft (232m2) Sephora at Kohl’s experiences in 2023. The 250 new locations brings the total Sephora at Kohl’s fleet to more than 850, achieving the partnership’s initial planned goal of the Sephora at Kohl’s rollout. In addition, Sephora will also plan to open 50 additional small-format Sephora at Kohl's locations by the end of 2023. The new location rollout will see the Sephora at Kohl’s concept enter seven new states in 2023, including Arkansas, Idaho, Louisiana, Mississippi, New Mexico, South Dakota, and Utah, bringing Sephora at Kohl’s presence to 48 states. As a result of the promising trajectory of the initial Sephora at Kohl’s stores, the retailers announced last year that they would deepen the partnership by expanding the concept to all Kohl’s 1,100+ locations. Kohl’s projects that Sephora at Kohl’s will grow to achieve $2bn in annual sales by 2025.

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