May 19, 2014, 4:00 PM

Kohl’s Q1 web sales fall below plan, but still grow by double digits

The web will get more attention as Kohl’s expands ship-from-store and invests in mobile technology.

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Kohl’s Corp.’s e-commerce growth fell below its expectations, but was still in double digits, CEO Kevin Mansell and other company executives told Wall Street analysts last week on the Kohl’s first quarter 2014 earnings call. The company did not give figures on its e-commerce sales.

Total sales in Q1 2014 were $4.070 billion, a decrease of 3.1% from $4.199 billion in the first quarter a year ago.

The company says it plans to invest significantly in mobile and in-store technology, including its loyalty program and push notifications for consumers in store.

“If they come into the store, we know they are there and [if] they opt into the Wi-Fi, we can shoot them an e-mail or an offer via their smartphones,” Wesley S. McDonald, chief financial officer and senior executive vice president, told analysts, according to a transcript of the call from Seeking Alpha. “We've been working with a consultant to try to help us sort of jump-start this and have started to do some segmenting of e-mails and retargeting of customers based on their browsing behavior online. I'd say we're in our infancy on this and certainly going to see more of this throughout this year and into next.”

Another e-commerce investment is in the retailer’s ship-from-store program, which it plans to expand to 800 stores from 200 now. The company expects that to happen in the third quarter. Kohl’s buy online, pick up in store test will expand to select markets in the third quarter as well, including Chicago, Milwaukee and San Diego.

For the first quarter, the company didn’t disclose e-commerce sales but did report:

  • Comparable-store sales decreased 3.4%.
  • Net income decreased 15.0% to $125 million from net income of $147 million in the first quarter of 2013.

Kohl’s is No. 23 in the Internet Retailer 2014 Top 500 Guide.

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