Following the close of EuroShop 2023, the World’s No. 1 Retail Trade Fair, Canadian retail expert Lisa Hutcheson returned home to Toronto to learn that American retail giant Nordstrom will be closing its doors in Canada.
Hutcheson, Managing Partner of the J.C. Williams Group, said Nordstrom came in very quickly to Canadian market but there were too many stores in the country, particularly in Toronto.
“They didn’t need to have that many stores,” she said. “I think that was one of the big mistakes. They were slow to get some momentum and then fast forward and the pandemic hit and fashion just took a beating. The category was down in April of 2020, 89 per cent for fashion and accessories. And then footwear also. The whole category just took a beating.
“I don’t think that people were thinking of shopping online at Nordstrom to buy anything. If they were shopping online for any kind of fashion or apparel it was in something that was sporting. Loungewear or activewear.
“And Nordstrom in Canada I don’t think their online is as prominent either. So they had these giant stores, very fashion forward and then they just didn’t have the population. For example, the CF Toronto Eaton Centre. There’s some tourism back but there just isn’t the downtown worker and the worker that is back is not dressing the same way that they used to. That would impact Nordstrom as well.”
Hutcheson said Nordstrom was really known for customer service in the US which was second to none. They had amazing footwear. But she said she doesn’t think that translated to Canada.
“I never sort of saw these crazy stories. There’s a book written by one of the Nordstrom people years ago and it was all about this incredible customer service. And I don’t think it translated the same way here to get that same customer loyalty as they have in the US,” she said.
“They were known for this phenomenal shoe department. I literally walk right past the shoe department every single day and it’s not legendary like it is in the US.”
From the service to the product selection, there was nothing really special about Nordstrom in Canada and the pandemic was the last piece and it has been just too tough for them to come back from that.
EuroShop 2023 took place for five days in Düsseldorf, Germany with 1,830 exhibitors. A total of more than 81,000 trade visitors traveled to the Rhine from all five continents.
Hutcheson was one of them.
J.C. Williams Group is the exclusive Canadian partner of the Ebeltoft Group, a global alliance of retail and brand consulting firms, working closely with clients from around the world, to transform their businesses and develop innovative and strategic retail solutions to help face complex challenges today and explore tomorrow’s opportunities.
Hutcheson said the Nordstrom experience really makes people think about the importance of Canadian retailers looking at Europe and real estate people who are looking for new solutions and tenants to fit the mix in our Canadian market.
“They should really be looking at Europe and not just the US. First of all, we’ve had a lot of US retailers, especially of late, and even including Target, but just sort of think that Canada is the same,” she said. “Whereas I find the European retailers are representing in multiple countries and I think they’ve really figured out before they just move into these other countries how to operate in those countries.
“There’s so much exciting retail in Europe.”
Hutcheson said there was a lot of focus at EuroShop on sustainability from an energy point of view and smart stores because of the energy crisis in Europe.
“Thinking about how they build the stores, the lighting in the stores, refrigeration, that whole energy management piece and how retail technology can support that,” she said. “There was energy monitoring, cooling systems, having solar panels on buildings, and things like that. That was a big piece of it.
“Along with the sustainability what we’re seeing from a store design perspective, or store visual presentation, was sustainable mannequins made from recycled products and biodegradable. We saw hangers that are made out of grass clippings and 100 per cent recycled products.”
Hutcheson said there was also much discussion at EuroShop about third places, third spaces – if place number one is home, and place number two is work, place number three is where people socialize and engage with people.
“It sort of was a hot topic back when Starbucks was in an expansion mode because they really articulated part of their strategy was to be in this third space. When I think a little bit about Nordstrom, when I think about shopping centres and BIA’s (business improvement areas) and downtown areas, I think we need to start thinking about how retail fits into this third place option again in terms of getting people from online to offline and what are those experiences going to be,” she said.
“These are these feel good atmospheres making the shopping centre the main street and the retail an experience and places for people to meet, collaborate, building relationships, really foster a sense of community.
“We’ve always been sort of thinking about cafes. But we do a lot work with museums and libraries and those are becoming these third spaces because libraries aren’t these hush places anymore. The new libraries that we’re getting are meeting spaces, collaboration spaces. There’s really these great spaces that can really enhance retail. Some of these Nordstrom spaces, could they be more than just retail that help create these third spaces? So how do you as a retailer create these kinds of offerings that are going to use some of the techniques out there – lighting, product offering, integration with food service – that really enhance the physical experience and increase those dwell times back up again that some of these areas are really struggling with.”
EuroShop 2023 (Image: Lisa Hutcheson) 
EuroShop 2023 (Image: Lisa Hutcheson)
Hutcheson said there was also a lot of focus at EuroShop on customer centricity and trying to use digital solutions to help the customer engage with the retail.
“Loyalty, digital coupons, really personalized offers through apps and also providing digital consulting solutions and assistance,” she said. “A lot of use of mirrors, and digital mannequins and other kinds of apps and technology to really engage and get to know the customer and being very specific on enhancing the experience for the customer,” she said.
There’s also emphasis on integrating the digital experience to make the shopping experience for the customer more efficient as well as stimulating the senses of the customer so it’s not just these flat experiences.
She said there’s elements of technology available that can be right for any size business and not just the bigger retailers.
I was a frequent shopper at Nordstrom Rack in Edmonton, but over time went less and less. They stopped sending designer clothing and shoes, and filled the store with 99 percent throw away clothing. In addition, they carried the same brands over and over again in handbags, accessories and cosmetics. You only need so much of the same product. As such, we eventually stop going. I think the US was sending all their left overs to us, hoping we would snap it all up. Well that did work.
People are not going to shop in your store because the hangers are made out of grass clippings, and there are solar panels on your roof. Most people don’t care, and don’t research your building before they decide to shop there. They will shop at your store if you have merchandise they like, if you have merchandise other retailers don’t have, you bring in new brands to keep us coming back to see what’s new, and have sales from time to time.
Why do you make it so complicated?
As far as “third spaces” how about putting cafes and restaurants, or just a drink bar back in your spaces. Remember, all major department stores had them. This is nothing new or complicated.
I think the quote from Lisa Hutcheson was very astute: relative to Nordstrom and Target’s experience, there’s a mentality among United States retailers contemplating expansion north of the border to treat Canada as if it were the 51st state. It’s just like home, they think, and they believe that minimal adjustments will reduce the cost of their investment while giving them the key to Canadian markets. Mind you, these are brands that in some cases have already figured out how to operate successfully in Europe, but still stumble in Canada. They over estimate their opportunities in Vancouver and Toronto, then maybe venture to Calgary or Edmonton while skipping the country’s second largest metro as alien territory. There has got to be a better strategy.
Nordstrom did have the cafe and the restaurant which I loved. The only reason they failed is they lost track of good old fashioned customer service and a lack of inventory. This is not about Canadians having a different ethic about shopping. Nordstrom just did not care.
Nordstroms failure was due to their inability to attract Holt Renfrew and Harry Rosens loyal customers ,too many stores in the Toronto GTA,
the effects of Covid on their sales along with the decline in foreign tourism. Note any other reason is pure speculation not backed up by any data
I don’t know why they pulled the Vancouver store since it was one of their higher grossing stores US or CDN.
While I like these interviews with “experts”, I find too much of what is said to be anecdotal instead of hard facts. First off, can we please stop bringing Target into discussions whenever a US retailer “fails” in Canada. Though there’s been a lot of pundits on why it failed (old Zellers locations/small footprints, weak grocery offering, etc), it’s well documented that their main failure was trying to use a new SAP SCM system in Canada (that once successful, would replace the aging system in the US), which caused the two biggest issues: no products on shelves, and zero online presence in a competitive market that needed one. When they couldn’t fix it quick enough, their brand reputation and Canadians patience was lost. On the comment that they “sort of think that Canada is the same”, the problem with Target was it wasn’t exact enough to the experience Canadians knew in the US. It’s also not a secret that Target was struggling in the US at the time as well, so the easiest thing to do is shut down in Canada to focus domestically before it’s forced to (like Bed, Bath, and Beyond). And the declining sales (in US as well) might be the only thing Nordstrom has in common. I’d really like to see how the 6 full line Canadian stores compared to the 100 in the US. I’ve read (as someone else commented) that the Vancouver store was one of their best performing stores – though, I haven’t seen proof (and frankly have a tough time believing it would do much better than the Toronto EC or Calgary Chinook location). As a Nordstrom customer through the years, we’ve been to many in the US (everywhere from Vegas to Spokane) and both the Toronto EC and Chinook locations in Canada – and we’ve had very similar experiences. Very helpful and professional staff – that “legendary” Nordstrom experience. Nordstrom’s product in their full line stores weren’t necessarily unique to Nordstrom – but I think it fit nicely between what the Bay offered and the higher end Holt Renfrew. Foot traffic in Nordstrom was always good in my opinion, and definitely busier during the anniversary sale (August) and Black Friday to Christmas. The Rack in Calgary also was relatively busy most of the time I was in there (and does offer a lot of Nordstrom’s house brands) – I’m actually a bit shocked given Nordstrom has stated that a good chunk of their new customers are Rack customers that they wouldn’t try to keep Rack in Canada at least. As far as that “third” space, Nordstrom was a very welcoming store in Calgary – clean, well spaced, nicely lit – and had the very good cafe at the entrance with seating outside (though, unfortunately, people would rather line up and wait at the two Chinook Starbucks locations). So, now does anyone want to predict when Saks Fifth Avenue finally shuts down locations?