Nordstrom Takes Second Bite at the Marketplace Apple: Is It Enough?
Calling itself the "Spotify of Fashion" doesn't help. Spotify has never turned a profit. Is this what consumers really want out of Nordstrom's? I think by "Spotify" they really mean "personalization" but I let this analogy lie there in your mind anyway.
Even if it it's a good idea - forgive me if I think the timing on this is curious. For a barely profitable department store, Nordstrom trying to go private, and launches a major new digital initiative at the same time?
Congrats to Mirakl and Nordstrom on the launch, but color me skeptical on the transformational impact.
Recall in 2011, Nordstrom entered the private sale marketplace (trying to catch up to Gilt) with the acquisition of Hautelook. At the time, this was the quote:
"... we are giving customers a fuller range of options for the way they shop today...". That eventually got shuttered/folded into Rack.
In 2024, on the launch of the new marketplace, this is the first value quote in the Nordstrom press release:
"... allows us to offer the full expression of our best brands and expands the depth of products and sizes we offer to our customers."
Here are a few key points:
* At this point, most vendors are required to dropship for retailers in between reorder cycles. But the assortment is not usually wide because of the cost/labor to setup a new SKU. Marketplace should streamline this.
And some thoughts:
* A marketplace should allow Nordstrom to streamline its brand onboarding process, and widen its assortment.
* Extended sizing on the same owned SKU is a relatively more advanced marketplace function. Will they be able to pull this off?
* Let's be clear -- offering full sizes online is not going to save Nordstrom. This has to be about new brands. (Can I ask please why Nordstrom doesn't do more collabs?)
* Nordstrom is investing more in digital, following a multi-year digital investment cycle from Macy's, and two years after the pandemic? Feels late.
* With the expansion of Rack offered this year (no doubt due to consumers trading down), it's clear that online may be the domain of full-price freshness it cannot afford to carry inventory on in stores.
This constant multi-year dance between off-price and full-price is confusing and damaging to the brand. Let's hope a well-curated marketplace does not cheapen it further -- and instead delivers on brand freshness and assortment.
