Nordstrom still sells Gucci handbags, unlike Neiman Marcus which saw a shortage of its Gucci stock after recovering from filing for a Chapter 11.
The global pandemic hit the retail stores hard, especially those that were primarily earning their income from their brick-and-mortar stores. This is especially true for luxury designer physical stores like Neiman Marcus, Saks Fifth Avenue and Nordstrom. However, each of these companies were affected differently, due to the strategies they adopted after the settling of the pandemic, and those put in place before.
When quarantining and self-isolation was introduced, physical retail stores needed to adapt or become extinct. Nordstrom was one of the luxury stores which did adapt, which secured its safety even through the troubling times. However, the company had already placed strategies which coincidentally worked to its advantage following more people shopping from home and not needing the five-star luxury shopping experience provided by luxury designer stores.
Nordstrom’s competitive advantage vs. Neiman Marcus’ downfall:
This is as even before the pandemic, Nordstrom had already given staffers the freedom to be proprietary personal stylists. The brand allowed for its salespeople to use services like Trunk Club and Style Links to curate looks and sell their merchandise online to their customers. Therefore, when physical stores were closed down during the pandemic, Nordstrom merely expanded this practice.
However, stores like Neiman Marcus had not invested in such technologies ahead of the pandemic. A matter which the luxury store brand addressed after it started the journey to recovery after the news and aftermath of having filed for a Chapter 11. Neiman Marcus addressed the gradual move towards embracing technology as one of the first integral aspects that the company was working on formally introducing. This was affirmed in January 2021 by vice president of digital selling experience at Neiman Marcus Group, Elizabeth Gleason, when she stated:
“This integration into using social features as part of our regular services allows our style advisors to help many clients at once, and provides effortless access to inventory and imagery of merchandise across all Neiman Marcus Group stores and warehouses, including items that are not online.”
This is especially poignant as brick-and-mortar stores are being slowly phased out due to the move in trends to shop online. While the trend was already gaining popularity ahead of the pandemic, COVID-19 worked as a catalyst, creating the shift in less than two years rather than the five to 10 years which was previously estimated.
Therefore, when physical stores had to shut down, the Neiman Marcus bottom-line wasn’t the only thing that was affected, as its relationship with luxury designer brands like Gucci was also hit hard, especially after it filed for an estimated $5 billion Chapter 11. Following recovery from the filing, customers and insiders recognised that there was a shortage in stock for the company.
Ironically, the shortage of stock has further created a dent in the luxury store’s brand, as the lack of range and offerings only further exacerbates the fact. However, Nordstrom still sells Gucci bags, both online and at the physical stores. Moreover, Nordstrom Rack also sells reduced priced Gucci bags for those looking for a good deal on a luxury designer bag brand like Gucci.
Nordstrom versus Nordstrom Rack:
Now if you are wondering what the difference between Nordstrom and Nordstrom Rack is, cost and the availability of styles would be the first distinguisher. Nordstrom Rack positions itself by stating, “We’re the off-price division of Nordstrom, Inc., and we’ve been serving up sweet deals to customers since 1973. At Nordstrom Rack, you can always find the brands you love up to 70% off.”
Much like Nordstrom, Nordstrom Rack also has physical stores, an online store and a Nordstrom smartphone app, which can be downloaded onto to both iOS or Android compatible devices. That being said, Nordstrom offers an exclusive five-star shopping experience for its customers. This is as you can make an appointment to specifically come into the store and have a personal shopper walk you through the new selection of handbags and offerings they have.
In addition to that, the customer will also have access to the latest and new product offerings by Gucci. The biggest difference between the two shopping experiences being the price point at which you buy the items. At Nordstrom, Gucci products are sold at cost price, whereas at Nordstrom Rack, you can find discounts of up to 70 percent off select items.