Shares of Kohl's jumped 7 percent on Thursday, after the low-price department store topped Wall Street's sales and earnings forecasts.
The news was a welcome surprise to investors following Macy's disappointing third-quarter results, announced one day earlier, which had sent shares of Kohl's 5 percent lower in sympathy.
Though Kohl's results were not blockbuster by any means — same-store sales increased by 1 percent, despite posting a 1.8 percent decline one year ago — they did indicate that parts of its reinvention strategy are starting to take hold.
Among them: A revamped loyalty program that counts 34 million members, nearly double the number it had at this point last year. In addition to boasting twice as many members, these customers are entering the holiday shopping season having already accrued points, giving them more incentive to shop at Kohl's.
The company is taking this strategy one step further by running a fourth-quarter campaign that encourages its loyalty members to sign up for its credit program, by prescreening them to let them know if they qualify.
"This is the one time of year when people really use their rewards," management said on the company's earnings call, noting that redemption rates tend to jump from the low 30s to 40 percent in the final three months of the year.