As featured in our Department Stores: Off-Price report, department stores have endured a decline in annual sales of nearly $75 billion since 1999 due to falling foot traffic. With declining sales, and to keep up with changing time, brands are shrinking their retail footprint and investing in Omnichannel.
The key challenge for department stores is shifting from attracting customers with products and pricing to providing unique and memorable experiences that drive brand affinity. In an effort to do the same, Nordstrom recently announced the launch of their new concept store called “Nordstrom Local” where customers can try on clothes and accessories styled by personal shoppers as well as get a manicure or order wine, juice, coffee, or beer from the bar. This concept stores, set to open October 3rd in West Hollywood, will span 300 sq ft, a fraction of Nordstrom’s average store size.
With Wall Street measuring the success of traditional retailers based on sales per square foot, will Nordstrom’s concept store move the needle in proving the success of the department store?