"Priority on Relevance Drives Nordstrom's Full Commitment to Direct-to-Consumer Brands"
Nordstrom, the iconic department store, has been adapting to the rise of digitally native brands and changing shopping habits, particularly among Gen Z and millennials, by embracing an omnichannel strategy that blends technology with experiential retail.
In a significant move, Casper, the direct-to-consumer (DTC) mattress brand, began selling its mattresses and sleep accessories in 31 of Nordstrom's full-line stores and on its website. This partnership marks Casper's 23rd retail partnership, signifying Nordstrom's commitment to working with DTC brands.
Nordstrom's strategy is not limited to Casper. The department store has forged partnerships with several DTC brands including Away, Thinx, Skims, Everlane, and Reformation. Some of these partnerships offer exclusive products only sold through Nordstrom, such as Boy Smells' Cologne de Parfum collection, which became the exclusive retailer outside of the brand's own website from April 8 to September.
The partnership between Nordstrom and Boy Smells is not just about sales. Boy Smells creator and co-founder Matthew Herman stated that Nordstrom shares similar values of diversity and inclusion, which aligns with Boy Smells' ethos. Herman believes that having Boy Smells' product sold within Nordstrom means providing a more inclusive selection of products to consumers.
Nordstrom's investment in digital tools is evident in its Buy Online, Pick Up In Store (BOPIS) service, smart fitting rooms with RFID inventory tracking, and personalized shopping experiences via online stylist chat and recommendation engines. These digital tools aim to provide customers with a seamless shopping experience that combines the convenience of online shopping with the personal touch of in-store service.
To engage younger consumers who seek more than just transactions, Nordstrom is transforming some of its physical store concepts into personal styling storefronts focused on immersive, service-driven experiences. They also host in-store events related to beauty and fashion that cater to the community and experiential needs of younger shoppers.
The pandemic has had a significant impact on Nordstrom's foot traffic. In April and May, foot traffic to full-line stores plunged 98.3% and 93.3% year over year, respectively. However, Nordstrom's investment in digital tools and experiential retail seems to be paying off, with e-commerce representing the majority of sales during the holiday quarter.
Nordstrom's partnership with DTC brands is not just about capturing more market share. The department store aims to attract and retain younger customers who value socializing and experiences as much as purchasing products. By offering a diverse range of sustainable and socially responsible brands, Nordstrom hopes to appeal to the preferences of Gen Z and millennials who prefer to shop with environmentally sustainable and socially responsible brands.
In summary, Nordstrom's strategy of investing in integrated digital and physical shopping, enhancing experiential retail, and broadening the role of stores and malls to combine retail with social, entertainment, and lifestyle experiences aims to meet Gen Z and millennial expectations for both technology and social engagement in shopping. This approach could potentially win over these shoppers by doing what Nordstrom knows best: customer service.
[1] Nordstrom's New Strategy for the Digital Age [2] The Evolution of Malls: From Retail to Social Hubs [3] Nordstrom's Digital Transformation
- Nordstrom's digital age strategy also extends to sports, as it partnered with NBA, WNBA, and NHL teams to offer exclusive merchandise, further connecting with Gen Z and millennial fans.
- Recognizing the importance of vaccines in overcoming the pandemic, Nordstrom has been implementing safety measures in its stores, such as mask requirements, social distancing, and increased cleaning.
- The department store's policy towards sustainable business practices is evident in its initiative to reduce plastic waste, using more eco-friendly materials in-store and for packaging.
- In the technological landscape, Nordstrom is employing AI to analyze customer behavior and personalize retail experiences, enhancing the shopping journey and lifting sales.
- Fashion-conscious millennials and Gen Z can find the latest trends in Nordstrom's retail offerings, with rising brands like Allbirds, Veja, and Outdoor Voices now available for seamless online-to-offline shopping.
- The fashion industry has been disrupted by the pandemic, and Nordstrom is adapting by expanding its online marketplace, giving smaller brands an opportunity to increase their reach and cater to diverse consumer preferences.
- In response to the ongoing pandemic and war-induced supply chain disruptions, Nordstrom's management has been proactively negotiating with suppliers for longer lead times and stronger commitments to protect the smooth flow of goods.
- As part of its dedication to the environment, Nordstrom has pledged to achieve carbon neutrality across its operations, transportation, and delivery services by 2030.
- In the world of finance, Nordstrom has been reinventing itself, exploring opportunities in the burgeoning field of online beauty and wellness, with aspirations to become more than just a retailer—a lifestyle curator and trusted advisor for its customers.
