Nordstrom Case Analysis

Gillian Kate Asuero

BSBA-MM  II-B

Mr. Ryan Marvin Mabeza, CPME

July 31, 2015

Nordstrom Case Analysis

Why Relationships Matter?  A clear correlation with that is exist between the quality and length of customers relationships. Essentially, the stronger the relationship, the longer the customer will continue to do business with you.  A satisfied customer is simply someone who has received what he was promised. Nothing more, nothing less. Strong customer relationships, on the other hand, imply that you have delivered something extra or provided added value to the customer. Long-term loyalty and the countless benefits that go along with it are awarded to companies that go the extra mile for customer. It is no secret that customers are a company’s greatest asset and it costs much less to retain a current customer than it does to acquire new one. But even though loyalty improvements should be a priority, many businesses struggle to improve the vitality of their customer relationships, especially when they confuse customer satisfaction with loyalty.

        Nordstrom, Incorporated is a leading fashion specialty retailer, offering customers one of the most extensive selections of clothing, shoes and accessories for men, women and children. Over the last few years, Nordstrom has been investing a great deal of money in new growth drivers, especially with regards to e-commerce. For the past years, Nordstrom, contrary to most other department store chains has been investing heavily in new growth initiatives. This includes the development of its online channels and fulfillment centers  increasing its store count and improved channel integration. The company is known especially for its inventory integration between stores and warehouses, allowing it to achieve lightning-quick turnaround speeds on merchandise. This has, for the most recent quarter at least, allowed it to deliver sales growth that was considerably higher than competitors. Although, these investments are eating into the bottom line, they should allow the company to maintain its impressive top line growth and its competitive edge in years to come. Overall, the company looks like a good bet in the retail space. Today, Nordstrom sets the standard in customer service and loyalty. In fact, the company is so well-known for this trait that urban legends of unusual acts of customer service still circulate today. One of the best-known tells how in 1975 a customer came into a Nordstrom store after Nordstrom had purchased a company called Northern Commercial Company. The customer wanted to return a set of tires originally bought at Northern Commercial. Although Nordstrom has never carried or sold tires, it happily accepted the return and instantly provided the customer cash for his purchase. Nordstrom, Inc. (Nordstrom) announced its Q4 2014 and full-year fiscal 2014 financial results. For 2014, diluted EPS of $3.72, was in-line with the Company's full-year outlook of $3.70 to $3.75. The Company's total net sales for FY 2014 increased 7.8% YoY to $13.1 billion while comparable sales increased 4.0%, exceeding the Company's full-year outlook of approximately 3.5%. The Company also provided outlook for FY 2015.