Nordstrom Swot Analysis

Nordstrom, founded in 1901 by John W. Nordstrom, is a high-end American retail department store with 225 stores in the U.S. and most recently, a flagship store in Canada (Caplinger. 2013). Generating over $10 billion in annual sales, Nordstrom has cultivated a reputation for quality and customer service. As a result, shoppers maintain a strong sense of loyalty to the fashion retailer. (Caplinger. 2013). This paper will examine the segmentation and target market of Nordstrom.
Demographic
Nordstrom shoppers are classified into two distinct groups. Nordstrom’s core group of shoppers, and those which the Nordstrom brand identify strongly with is the high-end luxury shopper. Nordstrom offers a high-quality lineup of designer apparel,
shoes, accessories, and cosmetics for the discerning shopper (Caplinger. 2013). The second group of shopper Nordstrom caters to is the Nordstrom Rack shopper or those with more modest budgets and spending habits (Caplinger. 2013). Regardless of budget, both groups of shoppers desire the high-quality design of Nordstrom product offerings and the perception of that quality that the company creates in its brands (Caplinger. 2013). The average shopper profile is married female, age 25-55. Nordstrom product lines cater to various sub-sets of shoppers. Top Shop and Brass Plum departments appeal to the single female shopper aged between 16-35 while The Rail and Men’s departments cater to both single and married males in the age range of 16- 70. Nordstrom Point of View/Narrative and Studio 121 department appeal to both married and single professional women aged 25-65 where as Savvy and TBD departments cater to the single or married females age 20- 40. Nordstrom designer departments; Individualist, Via C and Collectors, appeal to the high-end luxury shopper ranging in age of 25-65. Numerous other departments make up Nordstrom product offering and appeal to all shopper with its array of products including children’s, shoes, cosmetics and home offerings.
Psychographic
The psychographic make-up of Nordstrom shoppers are as diverse as its products lines.
One common core true of all shopper is the desire for quality products and responsive, personalized customer service. Nordstrom shoppers lead active lifestyles; engage in physical and social activities. Nordstrom shoppers are often involved in various civic and social groups, have a wide array of personal and professional interests and family oriented. From the pediatric customer to the geriatric, Nordstrom shoppers have full schedules leaving little time for wasted shopping. A shopping trip to Nordstrom for many is as much a social event as a functional one. Nordstrom recognizes this and has thus put into place its Café, a full-service restaurant offering a fine dining experience including alcoholic beverages. The design of the café allows shoppers to reconvene with family and friends while providing respite from the task of shopping. Nordstrom clients are fashion forward, discerning and demanding when it comes to quality products thus, the higher than average price point of Nordstrom product offerings is readily
accepted.
Geographic
Nordstrom currently has 225 stores located in the US and recently, Canada. (Van Rijmenam. 2013). Nordstrom began its journey in Seattle, Washington and cornered the market in the western region. Nordstrom has since opened locations in Minnesota Mall of America, Chicago and most recently, Manhattan in New York, and Canada, gaining more prominence on the East Coast. Strategic placement of Nordstrom stores capitalizes on cities with residents of greater spending power and affluence, maintaining continuity of the brand’s identity of high-end luxury and service.
Behavioral Characteristics Nordstrom shoppers desire a shopping experience that gives them a sense of importance, status and luxury.
Due to their hectic and active lifestyles, the average Nordstrom shopper desires a hassle free quality shopping experience. Quality driven and willing to pay the extra few dollars to feel a sense of esteem and gratification, Nordstrom capitalizes on these behavioral characteristics by encouraging salespeople to cultivate relationships with their clients thus providing shoppers a sense of trust and loyalty to the brand. Through the provision of personal shoppers, personal stylists and the ability to make an appointment for shopping needs, these behavioral needs are satisfied. The Nordstrom approach is ingenious as it also provides the ability to monitor and track the customers spending habits and trends allowing Nordstrom to base its products offerings and service with little margin of error or loss of profits. In addition to being fashion forward, the average Nordstrom shopper is tech savvy. In doing so, Nordstrom has cultivated a strong sense of community among shoppers thus creating a network effect that drives repeat sales (Caplinger.
2013).
According to Van Rijmenam (2013), “Nordstrom’s objective is to create the finest customer engagement both online and in the traditional store space. Nordstrom wants to provide a customized personal experience and with the vast amounts of data they collect they can achieve this goal”. To do such, Nordstrom has implemented a huge social media campaign and following via Facebook, Twitter, Instagram and Pinterest. Van Rijmenam states, “Apart from the data from their website or the Point-of-Sales data, they generate lots of data from their 2 million likes on Facebook, 4.5 million followers on Pinterest and 300.000 followers on Twitter”. Nordstrom Fashion Rewards program allows Nordstrom shoppers to use a Nordstrom credit card, which in turn, tracks shopper spending and reward points. (Van Rijmenam. 2013). In closing, Nordstrom has cornered the market on the ultimate high-end shopping experience that caters to quality and luxury driven customers of two distinct financial classes, the affluent and the middle class. Nordstrom has positioned itself well and thereby has managed to serve all stakeholders including investors (Caplinger. 2013). Caplinger (2013) sums it up precisely by stating, “Between keeping shareholders, customers, and employees happy, Nordstrom is a model for others in the industry to follow and truly belongs among the best companies in America.” (Caplinger. 2013)

References
Caplinger, D. (2013). Article. What Makes Nordstrom One of America 's Best Companies.
Retrieved October 1, 2014 from: http://www.fool.com/investing/general/2013/02/27/what-makes-nordstrom-one-of-americas-best-companie.aspx
Kotler, P., & Keller, K.L. (2012). Marketing management (14th ed.). Upper Saddle River, NJ: Pearson Prentice Hall.
Van Rijmenam (2013). Article. How Fashion Retailer Nordstrom Drives Innovation With Big
Data Experiments. Retrieved October 1, 2014 from: http://smartdatacollective.com/bigdatastartups/140826/how-fashion-retailer-nordstrom-drives-innovation-big-data-experiments