Is Nordstrom Perfect?
Attending Shop.org this past week, a keynote presentation by Jamie Nordstrom, president of Nordstrom Direct, got me thinking: Is Nordstrom really "perfect" or might we learn from their failings as well? In the retailing industry, we tend to lavish our attention on retailers known for strong sales and customer service, such as Nordstrom, Costco, Apple, Publix, Trader Joe’s, and the like, while demonizing others such as Sears Kmart, Best Buy (lately), Toys "R" Us (sometimes), A&P, Winn-Dixie, etc. And we’ve always got those that we have a love-hate relationship with such as Walmart, Target, Macy’s, Kroger, The Gap, and so on.
Mr. Nordstrom’s presentation didn’t really give away any company secrets, but was well received and did list some key strategies and tactics:
- Improve customer service. Although their reputation in this area is stellar, Mr. Nordstrom says it is their #1 goal each year because it leads directly to increased revenue and because the customer is clearly in the driver’s seat these days.
- Leave decisions to those closest to the customer. Nordstrom’s main rule for associates is "use good judgment."
- Accelerate openings of Nordstrom Rack. Since they do not believe it cannibalizes their full line stores, they have plans to double the number of Rack stores by 2016.
- Create seamless experiences for customers whether online or in-store. Focus on what’s best for the customer, not who gets credit for the sale.
- Increase investment in physical stores. They have recently added more personal stylists (trusted advisors) and plan eventually to remove registers altogether in favor of tablets.
- Use social media and try new social media venues. The ROI is not clear, but it is important to get customers talking about fashion, and social media is a good way for retailers to learn from their customers.
- Increase speed of shipping. Nordstrom eventually hopes to offer same day shipping.
- Invest in and partner with brands that can help them grow and offer points of differentiation, such as TopShop, Bonobos, and HauteLook.
- Offer complete visibility of in-store inventory online. It is OK to have edited assortment in stores, as customers want a selection of their favorite brands, but they must be able to access everything online.
- Create a customized environment for shoppers in stores. Some want more self-service, some want a lot of help — it is important to tailor the experience to each shopper’s wants/needs.
Jamie Nordstrom did not elaborate on how the chain is dealing with the store vs. online turf challenge that many retailers are experiencing other than to say that they were able to work it out because of the cultural history they have, of putting the customer first. We’ve all heard the legends of Nordstrom taking back returned product (specifically the tire story) that they don’t even sell. True or not, they have a great service reputation, but I wonder if we in the industry give them so much credit that we fail to learn from the few failings they might have.
- Customer service is changing, and so is Nordstrom – Shop.org Blog
- E-commerce vital to growth of Nordstrom, says Jamie Nordstrom – The Denver Post
- Nordstrom: An Impressive Growth Outlook for a Unique Retailer – Forbes.com
Does it help for retailers to search for flaws in “perfect” retailers such as Nordstrom ? What areas do you see where Nordstrom might improve?