Will Nordstrom Have the Same Problems as Target in Canada?

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By J.C. Williams Group.

On the surface, Nordstrom’s and Target’s entries into Canada have a lot of similarities. They announced they were coming the same year. They are both brands that are unique in the marketplace and relatively well known among Canadians. This is the first foray outside of the U.S. for them. Both stores relied heavily on their head office staff and were determined to deliver their culture in their new home. This is where the similarities end.

Target opted for a “big bang” launch into Canada. Nordstrom has chosen a very measured roll out of stores.

Target renovated a large number of existing stores within a short time. Nordstrom only opened their first store two years after announcing their intention to enter Canada.

SO WHO WAS RIGHT?

With Target’s announcement that they are pulling out of Canada, it appears that Nordstrom took the right approach. To confirm whether this is true, we recently took a close look at the only Nordstrom store operating in Canada. Located in Calgary, Canada’s oil capital, the store opened in September of 2014. There has been enough time since then for the operators to get any kinks worked out as well as to see whether they can sustain the excitement of their opening. Here is what we found.

This is a store that shouts service. From the front entrance to the friendly staff that seem to genuinely care that you are finding what you want. Someone even said “Welcome to Nordstrom!”

The store itself is well appointed and comfortable. In fact, it looks better than a lot of American Nordstrom stores.

The merchandise looks very fresh and although there was reduced merchandise (not surprising for January) the store was set to look great and give the Nordstrom shopper the option of high-end brands to more interesting little known brands.

With a combination of great service, seasonally appropriate merchandise, and a great look, Nordstrom does not disappoint. They can even entice a jaded retail consultant to start looking for her size!

So will Nordstrom make it in Canada – if Canadians have anything to say about it, the answer is yes. The number of Nordstrom bags going out of the store on a Thursday morning in January proves that point. The only issue is, can they make money on these stores? While we see them getting the top line sales, whether they can make money with Canada’s higher cost structure, only time will tell.

J.C. Williams Group is a well-known, full-service retail and marketing consulting firm. It offers clients practical, creative, and in-depth knowledge of retailing and marketing, including up-to-date know-how and techniques to make retail operations better and more profitable. You can also read their informative blog, Retaileye, here: retaileye.wordpress.com  

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12 COMMENTS

  1. The market is simply not there in terms of demographics. Our population is not large enough to create the numbers the large US stores are used to, over saturation of this market segment will fracture the currant high end share.

  2. I agree with Aileen. Nordstrom will simply take away sales from Holt Renfrew or The Bay. Same thing with Saks Fifth Avenue. Canadians could not keep Target in business.
    So imagine how it’s going to be at the higher end. Time will tell.

  3. I agree Canadians seem to sabotage any American retailer who enters our market. I am definately a Nordstrom shopper. Anytime I visit the U.S. I make a stop whether it’s Seattle or Portland. There’s something very inviting and customer service is top-notch. So; therefore All the best Nordstrom! may you continue to expand and remain in Canada unlike Target. But of course there was never any comparison between the two.

  4. The problem was how Target entering Canada and not the Canadian shopper. Had Target entered Canada in a more scaled approach and tried to understand the Candian shopper, it would have been very different.
    Nordstrom’s approach will allow them to succeed here. If they take away from Holt’s or The Bay, so be it. It’s healthy for competition and Nordstrom’s overall experience will up the ante (finally).
    To compare Target’s entry into Canada like Nordstrom’s is simply not accurate.

    • We couldn’t agree more – and the article was really more about contrast than a comparison. We’ll be watching the Ottawa and Vancouver stores closely, as both open over the next several months.

  5. I am not impress with the display and merchandising ,don’t look for me very trendy look more at any simple store you should visit the new man department at the Hudson bay on queen I am very please with the time and quality peoples make this a place to shop

  6. As the others have said, Nordstrom’s question will be whether there are enough high end shoppers in Canada to keep it alive.
    Canadians love their discounts – Hudson’s Bay steeply discounts at end-of-season, and Holt’s has its Now-or-Never sale.
    I don’t know if Nordstrom does the same or not.

  7. Nordstroms has high end merchandise. But it does not feel as much like a high end store anymore.
    Part of this is due to the following:

    -Nordstrom has too many stores(in the USA). It is just too common now to be considered high end.
    -Most Nordstrom stores are little branch stores in suburban malls, with limited selection.

    Holt Renfrew still exudes a high end style that Nordstrom just does not.
    That being said, Holt Renfrew is also in danger of kinda losing that style as well, as they are planning to open just too many locations (in the Greater Toronto Area at least).

    North American high end stores for the most part, just are too common to be special. The european high end stores are much more of a treat. They usually only have one location, located in the city centre. The stores are huge, and have an outstanding style to them.

    You just don’t get that in North America, where stores want to be in every mall you can name.

    • Perfect analysis. I completely agree.
      Holts will never be Selfridges or Le Bon Marche (because Markham isn’t London or Paris no matter how hard holts tries). And Nordstrom is far too common to be seen as an exciting place to shop. They have more outlet stores in podunk Outlet malls then they have actual main line stores in the USA. There’s something wrong with your business plan when you have to slap the Nordstrom name on a TJ MAXX-type store to make the majority of your earnings.

  8. I keep on hearing how Nordstroms differentiates itself from its competition by the level of service they provide but I don’t see that. I’ve been in that store on 3 different occasions and not once was I even acknowledged! It wasn’t that they were too busy as associates were standing on the aisle talking to each other. Perhaps it was because I was pushing a baby stroller and not dressed in fancy attire? If that’s the case, they really could learn a thing or two about retail psychology. Sometimes, those who spend the most money don’t look like they are the types to do so!

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