Page 171 - Marketing Management

148 PART 3 CONNECTING WITH CUSTOMERS

shopping trips complete with prestocked dressing rooms
in the customers’ specific size, champagne, and live piano
music; tickets to Nordstrom’s runway fashion shows; and
access to exclusive travel and fashion packages, including
red carpet events.
This strategic and often costly customer-focus ap-
proach has reaped great benefits for the company. Not
only has Nordstrom emerged over the past 100+ years as
a luxury brand known for quality, trust, and service, but its
customers stay loyal even in hard times. During the eco-
nomic crisis in 2008 and 2009, many customers chose to
shop at Nordstrom over its competitors due to their exist-
ing relationship and hassle-free return policy.
Nordstrom currently operates 112 full-line stores, 69
set of tires originally bought
at Northern Commercial. Although Nordstrom has Nordstrom Rack clearance stores, two Jeffrey Boutiques,
never carried or sold tires, it happily accepted the return and one clearance store, with plans to open 50 new
stores over the next 10 years. When a new store opens,
and instantly provided the customer cash for his purchase. Nordstrom connects with the surrounding community by
While Nordstrom’s “no questions asked” return policy
remains intact today, there are many other examples of its hosting an opening night gala complete with live enter-
tainment, a runway fashion show, and the ultimate shop-
exceptional customer service. Its sales representatives send ping experience to help raise money for local charities.
thank-you cards to customers who shop there and have As Nordstrom moves forward, the company continues
hand-delivered special orders to customers’ homes. to be flexible and look for new tools and means to help
Nordstrom installed a tool called Personal Book at its regis- deepen and develop its customer-salesperson relationship.
ters that allow salespeople to enter and recall customers’
specific preferences in order to better personalize their Questions
shopping experiences. Nordstrom also provides customers
with multichannels for shopping, allowing them to buy 1. How else can Nordstrom continue to provide excep-
something online and pick it up at a store within an hour. tional customer service and increase brand loyalty?
Nordstrom’s customer loyalty program, Fashion 2. What are Nordstrom’s greatest risks, and who are its
Rewards Program, rewards customers on four different lev- biggest competitors?
els based on their annual spending. Customers who spend
$10,000 annually receive complimentary alterations, free Sources: “Annual Reports,” Nordstrom.com; “Company History,” Nordstrom.com; Chantal Todé,
shipping, a 24-hour fashion emergency hotline, and access “Nordstrom Loyalty Program Experience,” DMNews, May 4, 2007; Melissa Allison and Amy
Martinez, “Nordstrom’s Solid December Showing Suggests Some Shoppers Eager to Spend.”
to a personal concierge service. Customers at the highest
Seattle Times, January 7, 2010.
rewards level ($20,000 spent annually) also receive private

Marketing Excellence baby-changing rooms, stocking specialty items such as
French free-range chickens, and introducing a value-priced
line of products. It developed a campaign entitled “Every
>>Tesco Little Helps” to communicate these improvements with
If you asked a customer of UK supermarket chain Tesco 20 ads, each focused on a different aspect of its approach:
what the shopping experience there was like in the early “doing right by the customer.” As a result, between 1990
1980s, “customer friendly” would probably not be the an- and 1995, Tesco attracted 1.3 million new customers, who
swer. Though it began upgrading its stores and product se- helped increase revenues and market share until Tesco
lection in 1983, Tesco continued to suffer from a reputation surpassed Sainsbury’s as the market leader in 1995.
as a “pile it high and sell it cheap” mass market retailer, lag- Tesco then introduced an initiative that would make it a
ging behind Sainsbury’s, the more upscale market leader. world-class example of how to build lasting relationships
To gain share against Sainsbury’s, Tesco needed to reverse with customers: the Tesco Clubcard frequent-shopper pro-
the public perception of its stores. It decided to improve the gram. The Clubcard not only offered discounts and special
shopping experience and highlight improvements with an offers tailored to individual shoppers but also acted as a
image campaign to “lift us out of the mold in our particular powerful data-gathering tool, enabling Tesco to understand
sector,” as its 1989 agency brief put it. the shopping patterns and preferences of its customers
Between 1990 and 1992, Tesco launched 114 separate better than any competitor could. Using Clubcard data,
initiatives to improve the quality of its stores, including adding Tesco created a unique “DNA profile” for each customer