Nordstrom (JWN) is trying a smaller store on for size.
The upscale department store on Monday announced that it was opening a tiny 3,000 square foot store—a small fraction of its typical 140,000 square-foot emporia—in Los Angeles that will not carry any clothing merchandise but instead offer services like personal stylists as well as refreshments like beer and wine. Nordstrom, which operates 121 full service department stores along with a chain of Rack discount stores, said the move was a reflection of changing customer tastes and behavior. The Nordstrom Local store, as will be called, is set to open Oct. 3.
“As the retail landscape continues to transform at an unprecedented pace, the one thing we know that remains constant is that customers continue to value great service, speed and convenience,” said Shea Jensen, Nordstrom senior vice president of customer experience, in a statement.
Nordstrom is just the latest major retailer struggling with declining sales at its physical stores, a particularly acute problem at department stores, and looking to smaller format stores as way to reach more customers – comparable sales at Nordstrom’s full-service department stores fell 7% in the first half of the current fiscal year.
Such retailers include the likes of Target (TGT), which is focusing those efforts on city centers, and Kohl’s (KSS) and Sears (SHLD) which are shrinking many existing stores. Amazon.com (AMZN) has opened a number of bookstores with a far more limited selection than a Barnes & Noble (BKS) store on the bet that shoppers don’t want to be overwhelmed by a physical store and that an e-commerce site can fill any gap.
This isn’t to say Nordstrom will not continue to focus on its department stores- it is opening a new location in Toronto this week. Nor will one store, a small one at that, move the needle. But what it does show is Nordstrom’s efforts to test out formats and services to anticipate where shoppers are going in terms of habits.
The Nordstrom Local will have eight dressing rooms to allow shoppers to on clothes and accessories like shoes, even though that merchandise will not be stocked at the store. Personal stylists will instead collect goods from nine area Nordstrom stores or via nordstrom.com. That harkens back to the more traditional approach of selling luxury goods, where a shopper trusts an expert to help select items. Still, that is not without risk at a time shoppers have ample tools at their disposal to figure out what trends are hot and appealing and are more likely to trust Instragram influencers that a store employee.
The store will offer services like manicures, as well as wine, beer, coffee or juice from an in-store bar in the hopes of turning a trip to Nordstrom into an outing. The notoriously tight-lipped company didn’t say whether it had plans to expand the concept to more location. But Nordstrom Local would certainly provide a boon in terms of getting into new submarkets and providing new points of pick up for customers, crucial as the e-commerce wars heatup. Any orders placed on Nordstrom.com by 2 p.m. can be pick at the Nordstrom Local, and the store will also accept returns of items bought online or from other Nordstrom stores. What’s more, Nordstrom Local will staff tailors to provide alterations.
