This is very interesting and having worked in retail, I 'get' what they are doing, and have done, and see how it works.
I will add that their liberal return policy is a big boost to them. I know if I want something big, like a new vacuum cleaner, I try to get it through Kohl's. Sales and coupons, and the knowledge that I can return it indefinitely if it doesn't live up to my expectations, keeps me coming back for those kinds of purchases. I just happen to be a consumer that believes something that costs $400 should have a longer return policy than 30 days, and they satisfy that for me.
I will say the quality of Kohl's merchandise has gone down considerably over the years in the textile areas. Clothing and linens they feature are not nearly the quality I was able to find there 20 years ago, but heck I guess it is that way everywhere. I do find myself spending much less time and money in Kohl's that back then, mostly because of that downturn in quality.