Last Updated Aug 26, 2010 2:44 PM EDT
Kohl's (KSS) is playing house with the magazine business, as it expands its ELLE fashion line into home furnishings.
Magazines are redecorating America's homes, not just by showing pretty pictures but also by selling their style. Kohl's is the latest retailer to add magazine-branded products to its home furnishings department, in this case expanding from ELLE's apparel collection (see photo).
For retailers, what are known as "shelter" magazines represent credibility and a built-in customer base. Always conscious of younger consumers, J.C. Penney (JCP) launched a Seventeen magazine home furnishings collection for the adolescent consumer a few years back. Walmart (WMT) launched a Better Homes & Gardens collection last year. And Kmart rolled out a Country Living collection -- some of which wound up in Sears, too -- that helped ease the exit of Martha Stewart Everyday from its home department.
Ah, Martha, Martha, Martha -- the matriarch of mass-market home furnishing style. When Martha Stewart Everyday rolled out at Kmart in 1997, she pioneered the idea of mass-market retailers using an outside presence to establish a home furnishings brand. Scads of imitators followed suit, from Chris Madden at J.C. Penney to Ty Pennington at Sears (SHLD), Kmart's sibling.
But trends fade over time; now magazines are the next new thing. The advantage is that magazines publish authoritative articles on fashion topics that range from apparel to home and so can stand as a credible style aribiters across a range of product categories. Kohl's is putting its own spin on magazine-based home fashion with a line that will initially include products such as picture frames, candles, decorative pillows and small furniture pieces ranging in price from $9.99 to $149.99.
The twist is that Kohl's ELLE Decor is based on a fashion magazine, not a home decor one. That entails certain risks. Mass-market consumers are famously conservative; even slightly fashion-forward Target keeps the bulk of its home fashion lineup in traditional color schemes, essentially seasonally tweaked shades of white, hunter green, navy blue and gold. And Martha Stewart Everyday at Kmart also got the majority of its sales from traditional hues.
Kohl's characterizes the ELLE image as "fast fashion," a conscious link to retailers such as H&M (HMB) that develop looks based on seasonal designer fashion and get them into stores within three or four months of runway debuts. Kohl's is also still committed to its own brands, noting that the exclusive labels it offers, such as Candie's, accounted for 44 percent of its sales in 2009. That helped keep sales (up five percent) and net income (up 12 percent) healthy despite the gathering recession.
Put it all together and what the ELLE connection is another link in Kohl's exclusive brand strategy.
For Kohl's, home is increasingly where its heart is.