Why is Nordstrom so successful? (Over 13 reasons!)
While many traditional stores are closing, Nordstrom remains a retail giant that demonstrates the benefits of adapting to changing market conditions. Indeed, brands that can flexibly adapt to the changing retail landscape—especially in the pandemic and post-pandemic era—will thrive. Nordstrom’s success is due to its adaptive policies to ensure its continued viability and success.
The question, “Why is Nordstrom so successful?” remains relevant. Answer Barn conducted the research to highlight areas that may serve as inspiration for many who are considering starting a startup or just want to see how Nordstrom stands the test of time.
Why is Nordstrom so successful?
It’s not just one thing that makes Nordstrom so successful. Nordstrom is successful for a variety of reasons, such as a diverse product portfolio, generous refund policy, strategic partnerships, and exceptional customer service, just to name a few.
To learn more, here’s what Nordstrom has done to achieve such success:
- Excellent customer service
The retail giant has a long history of providing exceptional customer service. Nordstrom is selective in its hiring practices, preferring to work with “pleasant, skilled people.”
Customers are happy with the return policy because they know they can bring any item back to Nordstrom for a full refund.
In the end, Nordstrom has been successful for so long because of the exceptional service they provide to their customers.
- reach out to different customers
Nordstrom Rack generates substantial revenue for the parent company. Only 10 to 20 percent of Nordstrom Rack shoppers also shop at high-end department stores, suggesting a significant portion of shoppers continue to pay full price. It is thanks to these outlets that they reach a new, value-oriented customer base.
- Target young customers
One of the biggest challenges retailers face is dealing with millennials, but Nordstrom has addressed that.
Younger customers seeking discounts reach Nordstrom through outlet stores. The company expects that its younger customers will eventually shop at stores across the board as adults.
- Omnichannel focus
In order to become the best omnichannel retailer in the world, Nordstrom has set some lofty goals for itself. Nordstrom pioneered the concept of online and multi-channel retailing. Recently, Nordstrom added the ability to instantly buy Instagram-featured products.
Employees will also use information from the company’s Pinterest page to help with listings. Products that perform well on the platform are more prominently placed on the shelf.
In addition to its own flash sale site, Hautelook, Nordstrom has invested heavily in men’s brands Bonobos and Trunk Club.
Nordstrom Strategy
Nordstrom highlighted some key areas they want to focus on.
Win important markets
By integrating Nordstrom Rack’s assets and further developing the company’s distribution capabilities, Nordstrom is expanding its go-to-market strategy to its 20 top markets, which account for approximately 75% of sales.
This strategy has worked so well that it has become a core approach to the company.
Extending Nordstrom Racks
Nordstrom is increasing the price variety at Nordstrom Rack and strengthening the link between in-store and online inventory to increase sales and customer satisfaction.
Nordstrom Rack will eventually add $2 billion to the company’s top line, according to management’s projections.
Expand your online presence
Nordstrom is expanding its product offering, improving its personalization capabilities, and strengthening the connection between the online and offline components of the business.
In the future, the company believes that digital sales will account for about 50% of total revenue.
Unlock digital potential
Nordstrom is maximizing its digital-first platform to achieve the company’s strategic goals of increasing consumer engagement, increasing sales, expanding product offerings and enhancing customer service.
The company’s “closer to you” brand goal of serving consumers on their terms will be achieved in this way.
Nordstrom’s future plans
Nordstrom’s plans include:
deep insight
Using its IT infrastructure, Nordstrom is developing a 360-degree view of customers and their shopping habits, as well as the products and inventory the retailer offers.
The combined effect of these initiatives enables Nordstrom to provide scalable customization and improve the shopping experience for all customers.
new customer
Nordstrom is expanding the reach and channels of its services, with a special emphasis on attracting new customers to Nordstrom Rack.
wide choice
By focusing on fast-growing product categories, Nordstrom hopes to increase its current inventory of 300,000 items for sale to more than 1.5 million.
better service
Nordstrom has always been at the forefront when it comes to customer service.
Now, the company is leveraging its online expertise to offer shoppers a more streamlined and unified experience no matter where or how they want to shop.
The Nordstrom Advantage
Diversified Portfolio
The combination of Nordstrom, Nordstrom Rack, Trunk Club (subscription box service) and Bevy Up enables Nordstrom to meet the most important buying needs of the modern customer.
Exclusive brands and high-end designer merchandise
Nordstrom positions itself as a high-end department store that sells designer brands and luxury goods, including clothing, shoes, handbags and jewelry.
strategic partnership
Nordstrom differentiates itself from its competitors through partnerships with digitally native, direct-to-consumer businesses such as Greats, Top Shop, Reformation, Allbirds, Stella, Glossier and Dot.
Those strategic brands brought more customers to Nordstrom, who spent more on other products and saw a 30 percent increase in revenue compared to non-strategic brands.
strong growth
Nordstrom is financially healthy and rapidly expanding, thanks to the success of its shelf stores, e-commerce site, anniversary specials, pop-up stores and promotions.
Excellent customer service
As we’ve highlighted before, Nordstrom’s customer service defines it. One of Nordstrom’s greatest strengths is the personalized attention it gives its customers.
When customers walk into the store, a sales assistant should meet them and help them find what they need.
Excellent return policy
Customers can shop with confidence at Nordstrom thanks to its generous return policy.
Innovative customer experience
Nordstrom was one of the first department stores in the United States to fully embrace and utilize digital technology to improve the shopper experience.
It opened a new flagship store in New York City, offering a better all-around experience by letting customers virtually try on items in-store or online and use Trunk Club to personalize their purchases.
fulfillment options
All orders, big or small, ship free at Nordstrom. However, rival department stores like Nordstrom have a minimum purchase required for free shipping on your order.
Due to the growing popularity of online shopping, Nordstrom may differentiate itself from its competitors by offering free shipping.
Strong sense of corporate responsibility
Nordstrom has donated millions of dollars to hundreds of non-governmental organizations (NGOs) in the United States, Canada and Puerto Rico to show support for the local communities in which it operates.
In addition to contributing to Good+Foundation, Nordstrom has committed $5 million to New York City’s programs and community grants through 2020.
nordstrom competitor
Macy’s (M), Neiman Marcus (Neiman Marcus), Dillard’s (DDS) and Saks (Saks) are just a few to compete with Nordstrom by offering haute couture in a department store-like structure of well-known retailers.
Want to learn more about Nordstrom? Check out our related posts to find out if Nordstrom offers free mods, if Nordstrom allows dogs, and if Nordstrom sells Louis Vuittons.
bottom line…
Nordstrom’s success has been phenomenal, while other retail stores have failed to adapt to changing new customer behavior.
Nordstrom’s many advantages include the store’s excellent customer service and an excellent return policy.
These not only put the store on the path to success, but also set the store apart.
