At Nordstrom Inc., digital is now just a fact of life.

This story first appeared in the May 8, 2014 issue of WWD. Subscribe Today.

“The Nordstrom team is squarely focused on a strategy that serves customers the way customers want to be served today,” the retailer’s chairman, Enrique Hernandez Jr., told shareholders at its annual meeting in Seattle Wednesday. “But that’s evolving fast. In fact, it’s evolving faster than we had originally anticipated even just a year ago.”

It was a challenging year for retail in 2013, but Nordstrom continued to grow its sales, even while its full-line stores saw net sales slip 3.3 percent to $7.71 billion. The shortfall was made up by a 27.8 percent sales gain at, to $1.6 billion; a 12 percent rise at Nordstrom Rack, to $2.74 billion, and a 21.8 percent increase at HauteLook and the smaller Jeffrey business, which saw combined sales of $330 million. (Together and the Web-centric division including HauteLook and Jeffrey logged sales of $1.95 billion last year, 16 percent of the company’s overall take of $12.17 billion).

“We don’t even like to use the word ‘channel’ to describe the way we serve customers because customers don’t say, ‘I like this channel’ or ‘I like that channel.’ They say, ‘I like Nordstrom.’ They just like shopping on their terms,” Hernandez said. “It’s simply the way you have to do business today in retail, combining the accessibility of the pure online experience with the high touch and inclusivity of the stores.”


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Nordstrom is used to getting kudos, with service that stands out among the retail pack, but president Blake Nordstrom telegraphed to investors that he has his eye on a different competitor.

“Today the customer has such terrific choices, particularly at her fingertips with mobile technology,” Nordstrom said. “And if we’re not as a retailer executing well and meeting and exceeding her expectations, she’s got great choices to go somewhere else and you really only get one shot.”

Nordstrom said the company’s various businesses — full-line stores, and Rack, as well as HauteLook and Jeffrey — work together, noting that the HauteLook team recently helped relaunch the Rack’s Web site.

“These four together best serve the customer,” Nordstrom said. “It’s not about the individual part. It’s about when they come together, when the team finds solutions for the customer.…No other retailer has all four of these boxes.”

The annual meeting was a more or less standard affair, with short statements from Hernandez and Nordstrom. Shareholders signed off on the board and an accountant and signaled approval of the retailer’s executive compensation packages in a say on pay vote.

But the annual gatherings are also known for introducing a certain X factor into usually staid corporate affairs, with the floor being opened up for questions from any shareholder.

One male shareholder noted that the company’s management team was made up primarily of men.

“That’s a good point,” Nordstrom said. “Over 70 percent of our customers and employees are women. And you could argue for those handful of men that do shop with us, they are highly influenced by their partners, the women in their family.

“So we do a pretty good job throughout the company,” he said. “Right now, we don’t get a good grade as an executive team. There’s 10 of us and there’s one woman.…As an executive team, we’ve got an opportunity there and we’re working on that.”

He also noted that 25 percent of the company’s board members were women.

Nordstrom was also lobbed a political hot potato question about the company’s position on the minimum wage — an issue that’s come to the fore for businesses across the country, but particularly in Seattle. He took the question gamely, but didn’t answer.

“As merchants, we want to sell everyone and you might notice on those kind of issues we kind of lie low as a company because we think we’re best served staying out of the fray on that,” he said. “We don’t want to alienate any particular customers taking a side on whatever the issue might be.…We think it’s right to have that discussion about pay and compensation, but again, that’s about as far as we go. We’re not economists, we’re shoe salespeople when you get right down to it.”

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