A few months ago, we wrote a story on GeekWire about the growing rivalry between two iconic Seattle brands: Amazon.com and Nordstrom. But how big of a threat is Amazon to the Nordstrom franchise?
Pretty big. Reuters this week profiles Jamie Nordstrom, the 40-year-old great grandson of John W. Nordstrom who is leading the retailer’s digital efforts. The Nordstrom exec earlier this year told the story of how he purchased a tackle box through Amazon, and then received email alerts for the next several days related directly to his hobby, including one for an additive that would preserve gasoline in boats during the winter.
“I was like, ‘Crap, I need some of that.’ They got me and all I had to do was literally hit a button. That’s incredibly valuable,” said Nordstrom at the Milken Institute Global Conference.
The profile details how Nordstrom is attempting to reposition its efforts online, including mobile, taking a page out of Amazon.com’s playbook by patiently investing in longer-term projects. Interestingly, Nordstrom’s online efforts weren’t always paramount, and those knowledgeable of Seattle tech history will recall that Nordstrom.com once operated as an independent company bankrolled by Madrona Venture Group and others.
Nordstrom, whose downtown Seattle flagship store is just a few blocks from Amazon’s South Lake Union headquarters, now has full control and it is pushing ahead aggressively.
Earlier this year, the retailer unveiled a new iPad app that lets customers browse and buy clothes and accessories from the Apple tablet. It also invested in online fashion retailer Bonobos, leading a $16.4 million investment in the company. This all comes on the heels of the company detailing plans to invest $150 million in its online retailing efforts, hiring up to 400 people for its e-commerce group. Those hires include Kirk Beardsley, the former director of business development at Amazon.
The investment has not come without a cost. Shares of Nordstrom are up four percent so far this year, but they stumbled back in May when Wall Street reacted to the additional costs of its expanding online efforts.
As we’ve seen before with many industries, including newspapers and record labels, it is increasingly difficult for incumbents to quickly transition once a dramatic technological shift occurs. Can Nordstrom, which was founded in 1901, successfully make that leap?
Previously on GeekWire: Amazon vs. Nordstrom: Call in the fashion police for another crosstown rivalry