Nordstrom Expands Inventory-Free Local Store Concept

Nordstrom plans to open smaller stores that have no inventory. Nordstrom announced Monday that it will expand its existing stores in New York City, just ahead of its investor meeting. Nordstrom opened its first Nordstrom Local store in Los Angeles during the fourth quarter of last year. It covers approximately 3,000 square feet and features a nail salon and a bar with beer and wine. There is also a seamstress, ample fitting rooms, and ample storage. However, you cannot buy clothes there. Online orders can be shipped to the store for pickup. However, the idea is that the smaller space should be more experiential and customer-oriented. Nordstrom stated that the two new Los Angeles locations — one in Brentwood, one in downtown — will be specifically tailored to these neighborhoods.

Total Retail’s View: Nordstrom deserves credit for being innovative, and not succumbing to brick-and-mortar retail challenges, especially when the brand has as many mall-based stores as Nordstrom. Nordstrom, an upscale department store chain, has taken proactive steps to adapt its business to the digital nature of customers today and is currently testing new ways to bridge the gap between offline and online shopping. Nordstrom Local stores are an excellent example. All other businesses in the industry should look at what Nordstrom is doing and consider how they could apply it to their own businesses. What services or offerings could you offer at your stores to increase foot traffic and engage with your brand?


Fabletics to Open 75 New Stores In Global Push

Fabletics, Kate Hudson’s athleisure brand is opening 75 new stores worldwide, quadrupling the company’s footprint to 100. Hudson said that Fabletics is a digitally native business, which has allowed Hudson to better understand her customers’ needs and whereabouts. “Our customers still want to shop at retail even though they are anxious about it,” Hudson said.

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Fabletics’ success can partly be attributed to brand ambassadors who have large social followings like Hudson and, most recently, Demi Lavato. CNBC spoke with Fabletics, who stated that the brand had “rapidly exceeded $300 million in annual revenues” in five years of operation. Meanwhile, its existing stores have seen a 20 percent increase in same-store sales year-over-year. Fabletics plans to expand internationally as well. There are stores opening in the Philippines and other markets in 2019.

Total Retail’s Taking Adam Goldenberg is co-CEO at TechStyle Fashion Group, parent of Fabletics. He noted that the brand is actively expanding its international presence. Goldenberg spoke to CNBC about Fabletics’ real-estate strategy. “France is becoming a great market for us. Although we were not too early in expanding there, more countries are now following our lead. Athleisure is one of the fastest growing retail segments. There’s strong competition for market share with Athleta and lululemon as well as digital startup Outdoor Voices. Fabletics is a subscription-based brand that uses digital technology. It will be interesting to see how it incorporates a greater brick-and-mortar presence.