nordstrom Archives - Omnichannel Personalization SaaS Solution

25 Jan
2017

Nordstrom’s Omnichannel Success

Culture of Innovation

Innovation is risky business, but not innovating is even riskier. In a world where technologies are rapidly changing, companies must be willing to evolve in stride. Several companies are doing so by shifting to an omnichannel marketing strategy. Omnichannel approaches are synchronizing the shopping experience across mediums for retailers.

Some retailers have successfully incorporated omnichannel strategy into their marketing strategy. Over the next few weeks, we will examine a trilogy of retailers and the wins they have achieved through an omnichannel approach. Today, we are going to focus on one of the most popular luxury retailers- Nordstrom.

Part I: Nordstrom

Nordstrom worked to reinvent itself around the omnichannel shopper. According to the President of Stores, James Nordstrom, retailers need to focus more on the total experience than strategy for specific channels; “[At Nordstrom, we] don’t think the customer is loyal to channels. We don’t hear customers talk about channels very much. Customers value experiences.” Consequently, this belief is guiding Nordstrom’s omnichannel strategy towards creating a synchronized and seamless customer experience.

Rewards Program

The omnichannel focus of the Nordstrom Rewards loyalty program gives customers a chance to gain points regardless of which channel they purchase items.These loyalty members can also then track their activity from anywhere. Shoppers can use their mobile number as identification instead of memorizing a loyalty account number. An omnichannel approach to the rewards program has given Nordstrom a more open policy focus. The open policy focus allows shoppers to pay in whichever method they choose, shop whichever way suits them and still gain more loyalty points and rewards. Nordstrom shoppers are winning more, ensuring customer loyalty.

Social Media Influence

The luxury retailer is also approaching shopping from a multichannel perspective, and one of their innovative initiatives has been integrating with the mobile application, Instagram, and social media/organization platform, Pinterest. Nordstrom has made it possible to buy items from Instagram and find items based on Pinterest favorites. Instagram has been a modeling platform for retail items. However, a grievance shoppers have, is the inability to locate and buy the items presented on Nordstrom’s Instagram account. The retailer’s Instagram account now features a link which directs customers to Like2Buy, a platform that makes Instagram shopping easy. All of the items available for sale from the retailer’s feed are displayed as an elegant grid of photos. Shoppers can then scroll and “like” items, which are curated into a personal wishlist or shopping cart.

Pinterest is a social media platform which allows users to “pin” things they like or want to “boards” for later reference. It indexes all the different items, ideas, and interests we come across online. Pinterest gives Nordstrom insight of which items are popular among shoppers. Nordstrom has brought these “pinned” items to their physical stores. Stores display commonly tagged or “pinned” items from Pinterest. The luxury retailer also adopted that feature on their website. Shoppers can now see a “Top Pinned” landing page on the site. Nordstrom doesn’t limit themselves to a single channel. The retailer has effectively leveraged their social media user base to enhance the shoppers’ experience by including the favorite and trendy items on Instagram and Pinterest in their stores. Not only do customers see more products, but they are buying more at one time and are coming back for more of the items they love.

Nordstrom had experienced success by understanding that customers value an enhanced experience. Nordstrom has provided its customers with a retail experience that spans online, offline, and social media outlets. Shopping has become a synchronized and seamless experience – Customers can easily find the products they love and find them from anywhere. Tune in next week as we take a closer look at Neiman Marcus and how they are using omnichannel marketing to benefit their shoppers.

23 Mar
2016

The Road to Omni Channel Department Store: JCPenney vs Nordstrom

The next Round of The Road to Omni Channel Tournament ended with two “old-school” retail brands, Nordstrom and JCPenney. One brand, arguably the best customer service in the industry, and the other, a story of perseverance and come back. At the end of a tough game, Nordstrom’s unwavering strategy was upset, 71-68, by scrappy JCPenney’s frenetic pace of play and a half court heave.

The Play-By-Play

There aren’t too many business sectors experiencing the kind of pressure big box department stores face today. Foot traffic continues to decrease and in-store sales are stagnant. Meanwhile, online sales are increasing more than 30% over the next couple of years so companies like JCPenney and Nordstrom have no choice but to make omni channel a top priority. Each has done it differently, but both have made amazing strides, recruited deep teams and get solid play from every channel.

Nordstrom’s game was about everyone buying into a philosophical approach from the tip. Their relentless focus on customer service resulted in an unbreakable zone defense which covered the competition like a blanket. JCPenney never had an uncontested shot whether it was in the store, on desktop, mobile web, their app, social channels or from the customer service line.

Just when you thought there couldn’t be a deeper bench, JCPenney showed up with matchups for each channel, but also included a strong SMS player. That said, the difference in style was palatable. JCPenney played a full-court defense that poked at you like a jackhammer to concrete. There was a dizzying number of deals, discounts, clubs, groups, communities, opt-ins, points and promotions on every square inch of the court.

The offenses were opposites, as well. Nordstrom ran a smooth motion offense that was like watching a jazz ensemble in perfect sync. Crisp passes from desktop web into a login experience, to the mobile web, to the app, to push messaging and a perfect feed for a slam dunk from email was commonplace. The abandoned cart emails, location-based recommendations, and previous product views were all points of personalization and they occurred in nearly every channel. As a result, they posting the highest shooting percentage of any team in the tournament.

JCPenney played every offensive set like it was the end of the game tossing up three pointers from everywhere on the court. You could hear Desktop Web screaming every second of the game, “5 off 25! Buy one get one! Free, free, free!” Their shooting percentage wasn’t great, but the points stacked up as scoring runs that would rattle any team…except Nordstrom.

The summary of the game is best described as “streaks vs steady” with one streak too many. At the end of the game, JCPenney came back from a ten-point deficit with :46 left and their SMS player put the last nail in the coffin with a text from just beyond half court giving them a three-point win.

Key Stats – The Hammer vs The Diamond

When you compare these two teams the styles couldn’t be more different, but the stats were almost mirror images…

Cross Channel Experiences – Both teams drove to store via directions, allowed you to add events to calendars, barcode scanning in app, and localized content. Nordstrom did edge out JCPenney by highlighting and connecting you to their many events they offer in store across the country.
Operations – Every shot from the charity stripe went in for both teams, because they followed each purchase, opt-in and question with appropriate messaging. Nordstrom got extra points for their copy tone. Instead of standard requests for location or opt-in, they repeatedly presented benefits to giving them access and used cheeky copy throughout. They also won in store, because of the autonomy they give their staff and their very cool pop-up stores.
Recognition – Both companies will serve you well if you log-in, but it appears they’re both targeting anonymously, as well, at times.
Consumer Journey – Both teams were lacking a little in this area, but JCPenney dominated Nordstrom by integrating their Wedding and Baby registries online and in the app.
Recommendations – These were served up in a fairly typical fashion using widgets to introduce what others like you looked at or bought. Both parties could elevate recommendations to better match their brand essence: Nordstrom, by auto-emailing recommendations via local sales associates like they currently send manually; JCPenney, by personalizing their offers and discounts. Prior to the Ron Johnson era JCPenney shoppers used to love gaming the system with the mass of coupons floating around so why not embrace that gamification?

Conclusion

It’s clear JCPenney’s had challenges withstanding a rotating door of leadership at the institution and coaching ranks, but they appear to have rallied around omni channel. They’ve returned to their roots as an “in your face” couponer and elevated their game in store, but they still have to deal with the squeeze from competitors at both the top and the bottom. The jury is out, but they live to play another game.

Nordstrom is the classic Duke Blue Devil doppelganger. They play their game first, you know they’re always going to be in the mix and they’re extremely well coached. The players are given great autonomy so they have success from the floor of the store to the online customer service. It didn’t work out this time, but count on seeing them next year.

24 Sep
2014

Who are the Winners in Omnichannel Marketing?

If you are a marketer or are in an industry/company where marketing is a key strategy component, you have probably heard the term “omnichannel” one or two times (or twenty… or fifty…). It’s the buzzword that seems to be redefining the way consumer facing companies conduct business. Omnichannel marketing means reaching customers seamlessly across multiple channels from digital channels such as website and email to physical channels such as in-store and direct mail.

Consumers should be provided with the opportunity to connect with the company on various levels, and the brand or company should have the foresight to recognize the consumer as one and the same amongst these layers. Consistency across every channel is key; if the consumer purchases a product on the retailer’s ecommerce site, he/she should be able to return it at the physical store. The channels should essentially co-exist and be complementary in nature.

Here are some examples of A+ omnichannel experiences:

Sephora

Buy in store, receive an email asking for a review. I recently purchased foundation from Sephora at one of their mall locations and received this email a few days later.

I am an avid Sephora fan and have been a Beauty Insider member (their version of a rewards card) for many years. It’s intriguing that Sephora was one of the first retailers to embrace omnichannel marketing by pushing customers through to their website from an in-store experience.

As a result, Sephora now contains 1000s of reviews across a wide variety of products and is essentially the Amazon.com for make-up reviews. Sephora has also installed screens in their physical stores which gives access to customer reviews and prices. Just recently I received a few samples of various creams, and the store associate was able to print out a little “how-to” receipt with the average rating of the item and insert it into my sample bag. It is ingenious and quite frankly so very convenient.

While Sephora is making strides toward omnichannel marketing, they have not yet adopted pick up at store and have kept ecommerce and in-store purchases separate (a pain point for some). However, needless to say, Sephora has invested the time and effort into making the in-store purchasing process integrated with their digital presence, making the in store purchasing experience delightful and easy.

Nordstrom

Nordstrom has always been ahead of its time and continues to surprise and delight their customers with their seamless shopping experience. In fact, the large retailer was one of the first department stores to truly invest in their ecommerce platform while other traditional department store retailers lagged far behind.

The results speak for themselves, as web sales in 2014 grew 33% in the first quarter of 2014, and web sales accounted for 14.2% of all sales, up from 9% in 2012 (source).

Not only has Nordstrom invested in their flagship Nordstrom product, they have invested heavily in Nordstrom Rack’s ecommerce platform, using their 2011 HauteLook acquisition as a model. In May 2014, Nordstrom launched their ecommerce platform on NordstromRack.com along with a mobile app.

Hautelook members are able to sign in with their member IDs and passwords, and any purchases made on nordstromrack.com can be returned in store, making the omnichannel experience truly seamless.

Nordstrom executive VP and Chief Financial Officer Mike Koppel has said Nordstrom “plan[s] to invest $3.9 billion in capital over the next five years as we focus on serving more customers through store and online growth.”

As Nordstrom’s omnichannel marketing investments grow, we will see an even better consumer shopping experience.

Target

Although the massive data breach severely drove a bullet hole in the reputation of the big box retailer and revealed their severe lack of security coordination, Target has been the leader in omnichannel for big box retailers. In fact, Target has been so good at predicting customer behavior, a father got upset that his teen daughter was receiving coupons for expectant mothers, not realizing she was indeed pregnant.

Target’s omnichannel experience consists of ship-to-store, pick-up at store, ship-to-home, an ecommerce website, and a mobile app. Target’s mobile app allows for customers to pinpoint exactly where items are located in the store, down to the precise aisle of where they reside. Other features of the mobile app include adding items to your virtual cart and selecting pick up in store, a map of the store layout, a coupon/savings section, shopping list, registry list, and wish list among others.

It’s clear that Target is using its mobile app as their central HQ for the omnichannel experience, as multiple channels are integrated into one, making marketing extremely easy. Cartwheel is a coupon service which integrates with Facebook to offer coupons on things the consumer already buys. In exchange for coupons, consumers are handing over their social data which Target can then use to send targeted offers.

Retailers are moving towards this direction of the omnichannel experience, but there are some retailers who took the plunge well ahead of their competitors, adapting to the desires of their consumers. It’s these companies that will continue to thrive in the battle between ecommerce and traditional commerce.