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You can now buy shoes from DSW while grocery shopping at some Hy-Vee locations

CNN logo CNN 9/21/2020 By Parija Kavilanz, CNN Business
a display in a building: DSW is rolling out mini shoe shops inside of Hy-Vee grocery stores. © Courtesy Hy-Vee DSW is rolling out mini shoe shops inside of Hy-Vee grocery stores.

Shoppers walking into select Hy-Vee grocery stores can now pick up a new pair of shoes in addition to their eggs, milk and bread.

Shoe retailer DSW, which has more than 500 stores nationwide, is opening 1,200 square foot mini shops inside the regional grocery store chain.

The first two DSW shops opened this month in Minneapolis. A total of six are expected to launch in the city by the end of September, with plans to roll out dozens more in 2021, DSW owner Designer Brands said Monday. The company first announced the partnership in April.

a dining room table: DSW shops in Hy-Vee grocery stores will carry 3,000 to 4,000 pairs of shoes. © Courtesy Hy-Vee DSW shops in Hy-Vee grocery stores will carry 3,000 to 4,000 pairs of shoes.

It's the latest example of retailers adding locations in or near grocery stores to reach consumers where they are shopping the most. Last year, Kohl's piloted an Aldi grocery store inside one of its department stores.

Shoppers will see the DSW shop, which will be stocked with 2,500 to 3,000 pairs of branded shoes, at the front when they enter a Hy-Vee store.

The setup also features a digital wall displaying an additional 100 shoe styles, said Bill Jordan, chief growth officer at Designer Brands.

If they find a style they like on the digital display, shoppers can scan the QR code of the shoe using their phone, order it online, and have it delivered to their home or pick it up from a DSW store or the Hy-Vee location. Jordan said the company is installing pickup lockers at Hy-Vee stores with DSW shops for that purpose.

Customers can either pay for the shoes along with groceries at the Hy-Vee checkout lane or separately in the DSW mini shop.

Jordan said Designer Brands and Hy-Vee conceived the partnership a year ago.

"We were already thinking at the time about how to make the shoe shopping experience easier for customers. In many cases, grocery stores are the number one shopping destination that people go to again and again," said Jordan. "This has become more so through the pandemic."

With Hy-Vee, DSW sees an opportunity for Midwest expansion. Whereas Hy-Vee has more than 270 stores in the region, DSW has 130, including just five between Iowa and Nebraska, said Jordan.

"We have 30 million customers in DSW's loyalty program and Hy-Vee has many more," said Jordan, adding that the partnership will let both retailers cross-market their brands to each other's customers.

Jordan said Hy-Vee is not charging rent for the space but will get a percentage of sales as part of the deal. Hy-Vee declined to comment on the details of the partnership.

Update: DSW had originally told CNN Business it would be stocking 3,000-4,000 shoes in each of its locations inside HyVee stores. It has since revised that number to between 2,500 and 3,000 shoes.

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