Customer-Obsessed Innovation Continuously Drives Nordstrom Forward

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Nordstrom is not the same company today that it was five years ago. It will be a different company five years from now. That’s how you stay relevant for 117 years.

Ever since it began as a single shoe store in downtown Seattle, Nordstrom has always been about customer-centric innovation and adaptation, including adjusting to market changes, broadening selections of products and services, expanding geographically, and introducing technology that enhances the customer experience.

While technology is obviously crucial, technology for its own sake is not the primary focus at Nordstrom, where innovation is about solving customers’ needs and enhancing every customer interaction. Nordstrom always asks: “What problem is that technology solving to make life easier for the customer?”

Innovation at Nordstrom is about being “Customer Obsessed and Digitally Enabled”–not the other way around. Geevy Thomas, a veteran Nordstrom executive who is now Chief Innovation Officer, told us, “Customer obsession has been a thread all the way through, but how we deliver against that obsession has changed. Our future is going to allow us to leverage our history but not be held prisoner by it. The customer is at the leading edge, not the technology. We always have to ask ourselves: ‘What does the customer want?'”

Nordstrom has always taken notice of Amazon, whose Seattle headquarters are a few blocks away. Three years after Amazon successfully launched its Web site in July of 1995, Nordstrom launched Nordstrom.com, which today accounts for approximately 25 percent of $15 billion in annual sales.

When it comes to serving the end customer, Nordstrom is channel agnostic. The boundaries between physical stores and Internet shopping are becoming irrelevant. Customers don’t think in terms of a buying channel, but rather the kind of experience they desire at that moment. That’s why Nordstrom has evolved from being a curator of products to being a curator of services and experiences, supported by products.

The physical store is not dead; it’s become digitized, encompassing the personalization and sensory experience of physical brick-and-mortar with the personalization and convenience of digital technology via the customer’s device of choice.

Nordstrom offers salespeople and customers the tools for their smartphones to communicate and make transactions via secure one-to-one texting. Customers can use their smartphone to scan any item, see the price, decide what size and color they want, and then have their purchases delivered to their home, office, or hotel anywhere in North America.

Nordstrom’s online Reserve & Try feature enables a customer to search and discover products and then to quickly go to a nearby Nordstrom store to touch and try on items before buying. This feature enables the customer to best utilize their own time (their most valuable resource) and helps to make the shopping experience easier.

Here’s how it works: The customer shops online, reserves items in their digital closet, fills in their contact information and confirms a reservation in the store closest to them. Users can select up to 10 things, which are held until the store closes the next day. There is no payment up front. Within two hours or less (during store hours), the store texts the customer when the items are available to be tried on.

In the store, the customer visits a designated department called Order Pickup. They find their name on the door of a designated fitting room that contains the previously selected items. They can try on the items, decide what they want to buy and be out of the store in minutes. The customer doesn’t have to talk to a salesperson if they choose not to. If the customer opts to interact with a salesperson, that opens up the possibilities of selling more items to the customer. Reserve & Try combines the convenience of online shopping with the sensory gratification of in-store shopping to create a compelling, seamless customer experience.

By being Customer Obsessed and Digitally Enabled, Nordstrom continually finds ways to innovate and adapt that delight the customer, and motivate employees to enhance the customer experience, create loyalty, and contribute to the bottom line.

Robert Spector, co-author of The Nordstrom Way, recently talked about Nordstrom’s Customer-Centric Innovation in a Webinar produced by Solvvy. In case you missed it, you can watch the replay here!

Watch Webinar Replay