Brand spotlight: Nordstrom rocks e-commerce & invests in mobile expansion

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Nordstrom is no stranger to innovation. For years, the company’s been ahead of the pack, consistently investing in technological and digital advancements as they become available, paired, of course, with a solid reputation for extraordinary customer experience and service. The result? Steady growth, outstanding levels of engagement, and success – lots and lots of it.

The company recently announced a $3.9 billion investment that, spread out over the next five years, will serve to fund further online expansion, especially with regards to mobile. Like all good decisions, this one was based on real-life consumer trends: “Mobile is an important enabler of convenience as customers increasingly desire a more seamless shopping experience,” says co-president Blake Nordstrom. “Of the US population, two-thirds own a smartphone and roughly one-half shops on their device presenting a meaningful opportunity for us with over 90% of our customers using smartphones.”

He went on to reveal a production rate three times that of last year’s with regard to digital capabilities and tech features like text-to-buy (just what it sounds like) and shoppable Instagram posts – all in an attempt to keep up with the evolving expectations and desires of the company’s customer base.

If that sounds like a lot of work, that’s because it is, but the retailer knows the rewards make it worthwhile. According to eMarketer’s report on Department Stores and Digital Commerce, Nordstorm’s ecommerce sales went up an astonishing 22.9% to $2.36 billion between January 2014 and ‘15, while brick-and-mortar business pulled in an increase of 4.3% to $10.9 billion – clear evidence that the company’s commitment to digital is certainly paying off, especially considering Nordstrom’s top ‘genius’ ranking among L2 Think Tank’s September 2014 Digital IQ Index, which measures an organization’s overall “effectiveness of ecommerce, digital marketing, mobile, and social media” efforts.

For a company that’s been at the forefront of digital transformation since the late 1990s, such recognition is only fair. Indeed, for over one hundred years, Nordstorm has strived and succeeded to fulfill it’s mission of providing “exceptional service, selection, quality & value” – which applies as much to its product offering as to its construction of smooth and seamless customer experience. In as early as 2002, for instance, the company had already developed a multi-channel shopping experience for customers, thanks to a then cutting edge perpetual inventory system, the result of early investments in digital.

Not to say that traditional retail is no longer needed – just the opposite, in fact. Retail Info Systems News reported that, “Nordstrom recently noted that [its] new stores in Ottowa and Calgary sparked meaningful online gains in those regions,” leading to the decision to open three more locations in Toronto over the next two years. Added conveniences like the ability to return digital purchases in-store – whether users buy via Nordstrom.com, Nordstrom Rack, or HauteLook – boost the cycle all the more. According to eMarketer, co-president Erik Nordstrom sees those in-store returns as a positive, resulting in “increased foot traffic, [which] for Nordstrom Rack amounted to an additional one million retail visits in 2014.”

It’s plain to see where that’s led, and it will be fascinating to watch as the company continues to make whip-smart choices and innovate within the industry. Smart leaders should be keen to observe the steps that lead to such success, and draw inspiration when thinking about their own digital strategies – or lack thereof.

Are you still hesitating on total digital transformation? Get in touch @hybris_software and let us know what you think.

Anastasia Dyakovskaya
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October 27, 2015
Anastasia Dyakovskaya

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