Nordstrom Launching ‘Do Good’ Concept
Nordstrom is planning a new store in SoHo. No, it’s not
another Rack location nor the long-awaited Nordstrom flagship that New Yorkers
seek. It’s a new “unique,
philanthropic” concept store that plans to donate all its earnings to non-profit
groups.
No decision has been made yet, according to Nordstrom spokesperson Pamela
Lopez, on whether the merchandise sold in the 11,137 square-foot store will
be created for the concept or taken from one of the department store chain’s
other formats.
The location at W. Broadway between Grand and Broome streets
will be the only store of its kind for the chain. The store will occupy the
first two floors in a nine-story structure that includes residences on the
other floors. Consumers will not see a “tie in to Nordstrom,” according
to the retailer’s spokesperson in an interview with The Real Deal.
Discussion Questions: What do you think of Nordstrom opening a store with
the goal of raising funds for charity? Are there any other examples in retail
of a major merchant doing something similar?
On a humanistic level, I like the concept, but shareholders must wonder why Nordstrom would spend their money on this venture.
The do-good store is risky on several different levels. For one, consumer groups will be watching carefully to be absolutely certain that promises are being fully fulfilled without exception. In my opinion, any glitches might cause an ironic impact on the company’s PR.
An obvious alternative is to simply donate a small percentage of all their sales instead of concentrating their philanthropy in one location. That way everyone gets to play a part.
On second thought…
Seems to me that If you’re going to spend $197 on a sweater and a poster featuring the dusty tear-stained face of a Ugandan child says 3% of every purchase is going to some mysterious charity – don’t you wonder who’s getting the huge lion’s share of the profit? Let’s see, chump change going to starving orphaned Ugandan child and wads of big bills going to ‘rich-greedy-shareholders’.
I think going into a store where you know that lion’s share is going to help people in desperate need would be a huge motivator. What is key in my mind is that they need to tell the stories of what is happening as a result. That’s what I love about the micro-loan programs. You know your money is helping that woman set up her sewing store in that village and now she can feed her family every day.
Now then…what if a customer could decide at the time of purchase where the profit from his/her purchase should go? Every time they purchase something else they get an update on the chosen cause. THAT would be very cool.
Notice that there has been no discussion of what consumers care about most: why should I buy clothes there? What styles will there be? If they aren’t Nordstrom stocked, what the heck are they?
I think efforts like this are well meant, but ill considered. Consumers care first about the product they are buying. And often doubt claims like “the profit all goes to….”
So in making the announcement, Nordstrom has ignored what’s most important and emphasized the thing consumers find hard to trust.
Feels a little like desperation.
Just make their own clothes more affordable. That’ll be the ticket. Or create more Rack stores. That’s where mass America will familiarize themselves with the name and then trade up to the regular Nordstrom.
Do Good? Just do it everyday in ways that count massively.
Nordstrom’s has a pretty good track record of knowing their customer and carving out a solid position in a tough retail category, so I bet they’ll get the details right. I say, well done, go for it. Good substantive PR that will resonate, spread their wealth and it will make their other registers ring.
If nothing else, Nordstrom has created another way for a write-off at year’s end. On the humanistic side this is a nice thought. Executing it might not be that simple. I am wondering if we are going to see rack store items that can not be reduced any more moved to this location? If so, they have found a way to move merchandise and benefit from the good publicity it will create.
Starbucks did something similar in Washington, DC. At a store where three associates were murdered during a robbery in 1997, the brand subsequently donated all store profits to a Starbucks memorial fund which then made grants to local groups working to reduce violence. I can’t be sure, but I believe that Starbucks location eventually closed.
Regardless, I like the Nordstrom concept. It’s a great example of a brand finding a creative way to give back. I’m sure it will generate positive buzz among consumers, and I hope it has staying power.
Like (most) everyone else here, this seems to make me a little uneasy…and why is that? Are we so cynical that we question everything, even something that seems outwardly…well…philanthropic ? Perhaps, but maybe we’re tired of do-goodism morphing into a marketing ploy; it seems that if N really wants it to have “no connection to the store” it wouldn’t say anything at all. Time will tell, I guess.
In researching for the book “Spend Shift,” co-author John Gerzema noted that of all the brand dimensions they studied the one that had shifted the most in terms of its impact on consumer purchase decisions was “KINDNESS” – Not exclusivity, not price leadership or even quality.
Consumers are shifting their dollars and brand allegiance to companies that demonstrate corporate kindness and social conscience.
I applaud Nordstrom not only for recognizing but also for so boldly acting on it.
I feel all warm inside. Don’t you?
I still remember what Dad told me – “Do something nice for someone today and try not to tell a soul about it.”
If the only thing they know so far is that they don’t want their name on it – why? If they don’t know what charities it will support – why? Why all the horn tooting about something you want to disassociate yourself with and you don’t know who you’ll help? A nice concept? Sure. Yet, I don’t think a concept has never helped anyone in need – has it?
Call my a cynic. I’ve been called worse.
Get your stores right. Make your customers happy. Deliver your customers an experience like no other. Make your associates the best and the most loyal they can be and reward them for it. Do all these things and do them well. If you do, the profits will roll. When they do, do some charitable giving and do that well too. If you do, it will become known on its own by what it does for those who receive it.
In the meantime, I don’t really feel so warm inside about something this ambiguous and unproven. Good works rarely need an announcement and if it’s necessary to shout about them, have something to really tell. For now, maybe Dad’s words apply.
If Nordstrom wanted to open a non-profit, why didn’t they just buy Sears?
Who would recommend that anyone open a store under a different name, in an expensive market on the other side of the country, and then give all the profit away?
This is wrong for many reasons. Philanthropy can be successful as a marketing tactic. It is unlikely to succeed as a strategy. The concept is contrived and disingenuous. No surprise there’ll be zero ties to the Nordstrom brand.