Nordstrom Rack Lessons: Store & Digital Balance

Omnichannel Fulfillment Defined

Omnichannel fulfillment describes the experience of customers being able to access products from both a physical store and online. This means that customers have the ability to buy products in-store or online have their order fulfilled from their local store for pickup, or from a remote store or warehouse for shipping.

What is Store Pickup and What Does it Require?

Store Pickup is a type of Omnichannel fulfillment that allows customers to select their items and have them ready for pick-up at a physical store location. It requires a physical store to be open, have staff on-hand, have the necessary inventory, and have the ability to manage the order-processing and pick-up process.

What is Ship From Store and What Does it Require?

Ship From Store is a type of Omnichannel fulfillment that allows customers to select their items and have them shipped directly from a store location. It requires a physical store to be open, the necessary inventory to be available, and have the ability to manage the order-processing and shipping process. This often requires stores to add space and supplies to manage the physical shipment of products from the store.

Nordstrom Rack’s Struggles

A recent article shared that Nordstrom Rack is slowing their store-based fulfillment (ship from store) - specifically, Nordstrom Rack is reducing the availability of ship from store as a fulfillment option for orders and is instead only exposing inventory online if it’s available in a warehouse. This is a reversal of Rack’s original omnichannel fulfillment plans, and is being done primarily because of inventory accuracy issues within each Rack store. This has led to a 16% decrease in Nordstrom Rack’s online sales, and it shows the challenges of balancing store and omnichannel priorities.

Balancing Store and Omnichannel Priorities

In order to balance store and digital omnichannel fulfillment priorities, it is important to consider the customer’s experience and expectations as well as the capabilities of your stores.

1. Customer Experience & Expectations: The customer experience is key when balancing store and digital omnichannel priorities. It is important to keep in mind what the customer expects when engaging with the store. Make sure that the customer’s omnichannel fulfillment needs are met while still keeping the store the priority in terms of inventory and customer service.

2. Store Inventory: The store’s inventory must be managed in order to ensure that the customer can access the products they need. It is essential that the store has adequate stock levels and that the inventory is properly maintained so that the customer can access the product quickly and easily. For both buy online pickup in store and ship from store fulfillment, it is incredibly important that your inventory be accurate and easy to locate in the fulfillment process, or you may find yourself facing the same struggles that Nordstrom Rack did.

3. Technology & Automation: Technology and automation play an important role in balancing store and digital omnichannel priorities. Automation can help streamline the order-processing and pick-up/shipping process, making it easier for the customer to get the item they need and reducing the time store associates spend on omnichannel fulfillment.

Overall, it is important to balance store and digital omnichannel fulfillment priorities in order to provide the best customer experience possible. It is essential to keep the customer’s experience and expectations in mind, manage store inventory, and utilize technology and automation to enhance the process.