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Nordstrom Reinvent the High Street

By Nigel Hill, Chairman, TLF Research

Nordstrom Local's 3 Los Angeles stores have everything...Except products!

Most retailers, especially department stores, need to adapt to compete with online shopping. Nordstrom seems to have cottoned onto this before most. Its three recently-opened Nordstrom Local stores in Los Angeles are not retail shops as much as experiential locations that offer services like tailoring, manicures, returns, same-day online purchase pick-up, and personal stylists. Shea Jensen, Nordstrom’s Senior Vice President of Customer Experiences said in a statement, “We think there are more ways to serve customers on their terms”. Unlike a typical 150,000 square foot department store, the Nordstrom Local stores are 1,000-2,000 square feet and they are located in prime urban areas not shopping malls or out of town retail parks. They are virtually inventory-free with just displays and online search. But they are much more than a handy place to order, collect and return your clothing.

The list of reasons to visit is amazing. Whilst going in to try on your Nordstrom clothing before you order it online you can book a consultation with a personal stylist to make sure it suits you, have a manicure or pedicure, a haircut or beard trim, have your clothes altered or repaired (any clothes not just Nordstrom products), have your shoes repaired or your dry cleaning done or have a present gift-wrapped. Want to hire evening dress? No problem. Customers can also buy hot or cold food and have complimentary drinks – local beer, wine or freshly squeezed orange juice!

With last mile delivery so costly for online retailers, Nordstrom are doing everything to click and collect rather than have goods delivered to their home. If they download the Nordstrom App, they can request “Curbside Pickup. When you arrive, we’ll walk your order out to your car.” The same applies to returns but goes a big step further – Nordstrom Local will take care of your returns to any online retailer, not just their own products. “Skip the line at the post office. Bring all your online returns to Nordstrom Local and we’ll ship them for you—no matter where you shopped. In case the retailer doesn’t offer free returns, we’ll cover the shipping cost for a flat $5 fee. We’ll also provide the box, and once your return is on its way, we’ll email the tracking number to you.”

Can you think of any British retailers where you can do all that? Can you think of many where you can do any of it? With a recent PWC survey reporting that 80% of Brits still like visiting stores, but two thirds of those like looking online too, there’s no point swimming against the tide. Just let customers do both in your store. The main objective, of course, is just to get people in, and ideally to tell their friends it’s worth going, but the Nordstrom Local formula will generate extra revenue too. Most of the additional services are provided by concessions who will pay rental or commission to Nordstrom, the wrapping and returns services charge a fee for other companies’ products. (In a pioneering deal at home, ASOS now pays Asda to use its stores for collections and returns.) But why wouldn’t you? Nordstrom doesn’t worry whether it’s helping a customer to return a competitor’s product. If you’re confident in your own offering, getting the footfall is all that matters.

Oh, and if you’ve got some old clothes or a handbag that you never quite find the time to take to the charity shop, just take them along when you pop into Nordstrom Local and they’ll make sure they’re sent on to good causes.

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