Beauty retailer Sephora will replace cosmetics areas at 850 Kohl's stores by 2023, it was announced Tuesday.
The first 200 Sephora stores at Kohl's locations will open in fall 2021 and will sell roughly 100 brands.
Sephora will also become Kohl's exclusive beauty offering on the US chain's website, the companies said.
Kohl's shares soared nearly 14 percent on Tuesday following the announcement.
Beauty products have been among the most sought-after items during the COVID-19 pandemic, alongside athleisure apparel and home improvement items, as people largely staying at home spend more on premium skincare items.
Beauty retailer Sephora will replace cosmetics areas at 850 Kohl's stores by 2023, it was announced Tuesday. The first 200 Sephora stores at Kohl's locations will open in fall 2021 and will sell roughly 100 brands
The new partnership between Kohl's and Sephora announced Tuesday will upend Sephora's current partnership with JC Penney, which filed for bankruptcy protection in May
Retailers have also noticed that Americans are consolidating their shopping trips out of the house to reduce potential exposure to COVID-19.
Last month Kohl's said it had its sight set on at least tripling its sales of beauty products after reporting growth of nearly 40 percent over the past five years.
Each Sephora set-up will stretch 2,500 square feet and will replace Kohl’s current beauty section. The Sephora mini shops will be staffed by people trained by Sephora and both companies will share in the profit of the shops.
Sephora is owned by Louis Vuitton owner LVMH and has 500 stores in the Americas and 2,600 stores worldwide.
Kohl's was hard hit in the pandemic and the Menomonee Falls, Wisconsin-based company sought to draw new and younger shoppers to its doors.
Kohl’s saw revenue fall 14 percent in the fall quarter. The company is down 25.3 percent for the nine months leading up to October 31.
The new deal will end Sephora's 14-year exclusive relationship with JC Penney, which filed for bankruptcy protection in May. The retailer will bounce back from bankruptcy after closing about a third of its 850 stores.
Kohl's shares soared nearly 14 percent up on Tuesday following news of the partnership
The JC Penney and Sephora relationship which dates back to 2016, is set to wind down in 2023.
Jean-Andre Rougeot, CEO at Sephora USA, said that the company was attracted to Kohl's because it has a vast network of 1,100 stores, mostly outside of malls.
'This is about reach. Kohl’s will allow us to reach consumers in a much broader way across the US,' he said to the Wall Street Journal.
This could be a key asset as malls have seen dwindling traffic for the past few years that further plummeted in the pandemic.
'Beauty is an underdeveloped category for Kohl’s. It’s a big market, there is a lot of disruption happening and Kohl’s is positioned to capture significant market share over the next few years,' Gass said to WSJ.
Similarly, last month Ulta Beauty Inc said it had signed a long-term deal to have its stores next to Target Corp's own beauty section.
Kohl's has also collaborated with Amazon.com Inc, WW International Inc and Planet Fitness Inc, offering services from the companies in its stores in a bid to boost store traffic.