Target And Nordstrom Comparison Essay

Target and Nordstrom’s are set up mainly as department stores in which product lines are organized in departments to be occupied by specific buyers and sellers. While Nordstrom is arguably the premier retailer of a wide variety of clothing, shoes, and accessories that land on the high end of what most would call “affordable,” Target would be considered the store for people who are middle class. The legendary “half-yearly” sales for men, and the additional markdowns that usually follow a sale section that is usually decently well stocked. The designer brand list has wild range in-house brands like Gucci, Prada, and the plain old Nordstrom line offer more than a few items with incredible looks and high quality for very reasonable prices. Its website is clean and easy

to navigate. Nordstrom’s hardly ever have large-scale sales, so those higher than Macy’s level retail prices will not come down often, if at all. Nordstrom pays sales representative on commissions which it says illustrates choice and incentive effect of pay-for-performance.

Whereas in Target, you are not going to find a lot of stuff that is built to last or manufactured in the USA. Target has good too great for low-cost casual stuff, but understandably struggles when it comes to more dressed up options. The clothing of Target is not comparable to the quality of clothes that Nordstrom carries.

At the other end of the positioning spectrum, Nordstrom has succeeded through a differentiation strategy that combines elevated levels of sales assistance by a dedicated and trained staff, specialized merchandise, and a shopping environment that is viewed by many consumers as exciting, entertaining, and fun.

Nordstrom and Nordstrom Rack are different retail operations in terms of their choice, pricing, store service, and store atmosphere customer intimate firms, which excel in serving the specific needs of the individual customer well. There is less emphasis on efficiency, which is sacrificed for giving more precisely what is wanted by the customer. Reliability is also stressed. Nordstrom is an example of this discipline. Nordstrom must meet some standards of cost-effectiveness. When customers evaluate the quality of a product, they commonly measure it against two kinds of attributes: those related to quality as excellence and those related to the quality of reliability. From a quality as excellence perspective, the important qualities are things such as a product’s design and styling, its aesthetic appeal, its features and functions, the level of service associated with the delivery of the product,

etc.

The boots from Nordstrom will have far superior styling, feel more comfortable, and look much better than those from Walmart. The utility consumers will get from the Nordstrom boots will be much greater than the utility derived from the Target boots, but of course, they will have to pay far more for them. That is the message that Nordstrom is spreading to its consumers; when excellence is built into a product offering, consumers must pay more to own or consume it.

Nordstrom’s business model is to offer high-quality, high-priced apparel in a full-service, sophisticated setting. This implies differences in the way the value chain is configured. Nordstrom devotes far more attention to in-store customer service than Target does, which implies significant investments in its sales teams. Moreover, Nordstrom invests far more in the furnishings and fittings for its stores, as opposed to Target, whose stores have a basic “warehouse feel” to them. Nordstrom recaptures the costs of its investment by charging higher prices for higher-quality merchandise. Even though Walmart and Nordstrom both sell apparel, their business models imply very different positioning in the marketplace and a very different configuration of value chain activities and investments.

Nordstrom, the luxury department store retailer, differentiates itself in the retail clothing industry by providing a high-quality shopping experience with elegant store operations and an elevated level of customer service all of which raise Nordstrom’s cost structure. However, Nordstrom can still lower its cost structure by, for example, managing its inventories efficiently and increasing inventory turnover. Also, its strategy of being highly responsive to customers results in more customers and higher demand, which means that sales per square foot increases. This revenue enables it to make more intensive use of its facilities and sales teams, which leads to scale economies and lower costs. Therefore no matter what level of differentiation a company chooses to pursue in its business model, it always must recognize the way its cost structure will vary as a result of its choice of differentiation and the other specific strategies it adopts to lower its cost structure; in other words, differentiation and cost structure decisions affect one another. Nordstrom can charge premium prices because they offer an exceptionally elevated level of service. Firms of lawyers, accountants, and consultants stress the service aspects of their operations to clients: their knowledge, professionalism, and reputation.