If you’ve been watching the fast decline of the retail industry in the U.S., Nordstrom’s new experiment makes sense. The company just announced that it will launch small-format stores in neighborhoods that will not be stocked with merchandise. The first of these stores will open in West Hollywood in early October.
The 3,000-square-foot shops, which are just a fraction of the usual department store footprint of 140,000 square feet, will offer the customer immersive experiences. Shoppers will work with personal stylists to find looks they like, which will then be delivered to their homes. They’ll get manicures and a glass of wine, while relaxing among couches.
All of this bears much more resemblance to the model that e-commerce brands like Warby Parker and M.Gemi have followed when getting into brick-and-mortar retail. And as I recently reported, Sephora is also launching smaller neighborhood stores, and for many of the same reasons Nordstrom is making this step. Digital-first brands recognize that stores aren’t necessarily places where customers will buy products–they can easily shop online–but rather where they can step into a brand’s world. In other words, stores must offer what the internet can’t: personal service, human interaction, entertainment.
Still, investors didn’t seem to get the concept. After the news was announced, Nordstrom shares fell 5.4%. More broadly, it has been a tough year for the company, which has seen its stock drop 3.8% since the start of 2017.
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