Swot and Macro Environmental Analysis of Nordstrom

Topics: Retailing, Department store, Wal-Mart Pages: 5 (1651 words) Published: August 6, 2012
Nordstrom was co founded 1901 by a 30 year old man named John W Nordstrom and his partner Carl Wallin. At age 16, John W of Sweden left his home and moved to Alaska where he struck gold. While in Alaska, he met a man named Carl Wallin, “who owned a shoe repair shop in downtown Seattle” (Nordstrom Employee, 2006). The two decided form a partnership and open a shoe store entitled Wallin & Nordstrom. Right form the start, the business philosophy was “based on exceptional customer service, selection, quality and value” (Nordstrom Employee, 2006). Focusing on this philosophy helped Nordstrom develop a competitive advantage in the shoe market. Due to their success, the company opened a new store in 1923.

Nordstrom a promising and upcoming departmental store in U.S has shown phenomenal growth in the business of retail chain business. The credit for this would go to the founder and promoter’s philosophy of inverting the pyramid and putting the customer on the top, followed by employees and it was the share holders who were accorded the last place in the priority list of company. Nordstrom working as departmental store in the retail industry would be effected by all the forces in the marketing environment. Nordstrom’s competitors are Wal-Mart, & K-Mart, and Carrefour. SWOT Analysis for Nordstrom:

Strength: It was rationalized by the promoter that if customers are satisfied by the services and the best service could only be offered by highly motivated employee (sales force), the share holders, promoters are bound to get their share in terms of high profit and revenue. For women’s clothing alone, there are 14 clothing options ranging from teenage apparel, to elegant ballroom attire. The multiple departments within the Nordstrom store cause the target market for a single Nordstrom store to range across a broad spectrum of potential buyers. While each of the target markets differs substantially depending on the department, the members of each of these markets do have a main connecting quality. Brass Plum (B.P.) is Nordstrom’s only junior’s department, targeting young women, ages 16-22 in the middle or upper class. B.P. offers the latest fashion trends for the younger women at a price that is more reasonable than high-end boutiques and department stores. While each of the departments have a target market that separates itself from the rest of the store, it can be seen that within all of the heterogeneous factors there are three homogeneous factors that can be found. First, in all departments, the consumer is looking for a quality product that will suit their clothing needs. Second, no matter what their clothing needs, the consumer is looking for clothes that portray a specific image of their choosing, such as an established professional or a young trendsetter. Lastly, throughout all of the clothes offered at Nordstrom each consumer is expecting the Nordstrom, guarantee of quality that ensures the consumers happiness with the product - no matter the circumstances. Second strength, Nordstrom also relies on customer word of mouth. While other competitor department stores deal with union battles, and declining sales, the quality and outstanding customer service is rarely questioned by consumers. Consumers know by personal experience and word of mouth that Nordstrom is dedicated to its customers. Nordstrom also engages in public relations activities through the promotion of some of their clothes. Most recently, Nordstrom has taken an active role in the “ONE” campaign and formed a partnership with the company Edun. Edun is selling a t-shirt with the word ‘ONE’ across the front.

Weaknesses: In terms of material, physical and manpower, resources, Nordstrom is lagging behind its competitors. By sheer volume of operations and business generated by retail chains like Wal-Mart, and Carrefour is far more in terms of dollar value. While that price is...
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