Bringing Relevance, Soul And A Sharper Focus To Private Brands

With the world’s changing priorities and lifestyles, the Nordstrom Product Group is doubling up on efforts to stay relevant and in touch with the consumer.

“We have 12 private brands. It’s been a moving target,” said Jen Jackson Brown, executive vice president and president of the Nordstrom Product Group, young adults and kids.

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“We’ve been editing back our private brands. They really needed to have a soul and attract certain customers. Some were just transactional labels. We asked our customers which ones do you have a relationship with, and those we grew. We picked fewer but we made them more meaningful.” Not long ago, there were 40 private brands in the portfolio.

“We also found out that our customer really values seeing the same brands offered for themselves, their children, their partners. A lot of our brands were for one gender or another, so we expanded them out for the family.

“We really built up the design and fit part of our organization,” said Brown. “That’s where we spend most of our focus.”

NPG, which covers apparel and accessories for men, women and kids and home goods, calls its private brand portfolio “Nordstrom Made.” NPG has a team of about 350 people in merchandising, design, development and sourcing, and works with manufacturers in 25 countries. “I like to say we do everything from candy to cashmere,” said Brown.

“Our young adult business has been a big focus for us, in just getting that back on track and catering to the right group,” said Brown, who began her career with Nordstrom as a salesperson in Glendale, Calif., in 1990 and steadily rose up the management ranks. “For the younger Millennial, we launched Open Edit in the spring. We’ve launched lots of brands in my time, it’s one of our competencies, but I’ve actually never seen a brand take off like this before. Now it’s how to scale and grow that.”

Open Edit, available in men’s, women’s, kids, accessories and jewelry, “has been our number-one brand launch.”

Regarding Open Edit’s target audience, Brown said, “I hate to use age because I feel like people are so ageless. But we are designing for somebody probably five or 10 years out of college, starting their career. Their life is busy, full and vibrant.” NPG’s deep dive into the data, and having conversations with customers to understand all the things they do, “really helped us to get it right, right out of the gate. I think that’s the page I’ll use to launch new brands.”

Nordstrom has been evolving its Halogen brand, targeting Millennials with “day-to-night essentials” with greater comfort and versatility in light of changing lifestyles and work situations. More trend-driven pieces have been added in recent months.

“Halogen is a really big, important brand for us,” Brown said. “In September, that relaunch hits, providing we can get everything here on time,” Brown said, referencing supply chain issues impacting the entire industry.

The relaunch, she explained, is about returning to the roots of the brand. “It’s always been our customers go-to brand. People rely on it for their key blazer, a great-fitting black pant. It’s expanded for the new work [situation] so there is a lot more versatility in the collection,” including a lot of sophisticated woven prints. “Our pants and bottoms completely changed because we know people are either on the computer screen, or if they’re going into work, they want to be comfortable. They are not really interested in wearing six-inch heels and that whole deal, especially the customer we target with this.”

The Nordstrom label, Nordstrom Made’s largest brand seen in home, kids, layette, men’s and accessories, is poised for further growth. “When we get it all the way expanded out, it will be in every category,” Brown said. “We are expanding into women’s right now.”

The Nordstrom label, she said, reflects “timeless classic yet fashion, those pieces in the closet that never have to change — the perfect cashmere sweater, that black cardigan, those things she always relies on and peppers them with of-the-moment fashion,” from different labels. The Nordstrom label in women’s “will have nothing to do with of-the-moment fashion” and is expected to launch later this year. “We really thought about someone who has a busy lifestyle. They want to look great but don’t want to be fussy about being on trend. It’s more of mindset than an age.”

Other top Nordstrom-owned brands include Zella activewear, which was introduced in 2007 before the athleticwear boom. It’s offered in women’s, men’s and kids. There’s also BP for young adults, and Treasure & Bond which donates 2.5 percent of net sales to charity.

“Probably a year and half ago, we said every single brand we have is going to have extended sizes. That was a bold move,” said Brown. “We hired people to help us understand fit for different types of body shapes. Then we got a team together across the whole company, and said, ‘how can we serve our customers better and how can a salesperson at Nordstrom help us understand where we are doing well and where are we are not?'”

One of the biggest ideas that came up, Brown said, was wanting to see different people wearing Nordstrom brands, in other words, a more inclusive approach. BP + Wildfang (introduced last spring) was born out of that. It’s an unusual pairing, where Wildfang, a fashion label that challenges stereotypes and gender norms, teamed with Nordstrom Made’s BP brand on a gender-fluid collection including overalls, button-ups, blazers, statement T-shirts and accessories in a body-diverse size range up to 4X.

Henna and Hijabs x Nordstrom, geared for the modern Muslim woman, is another recent launch reaching different audiences. “There were people buying that for a whole different purpose than just to wear as a hijab. And that’s just exactly what we wanted — to be able to create that awareness on that culture, and also fashion for everyone,” said Brown.

This month, Nordstrom will launch Nordstrom x Christina Martinez to celebrate Latinx Heritage month and reach a largely underserved customer. Martinez is a Mexican American artist known for beautiful art prints which Nordstrom has adapted for apparel and home products. For Nordstrom to “authentically” appeal to different populations and ethnicities, it’s important the retailer tap those who are from and fully understand groups being targeted. “We are looking for more collaborations and influencers that help us with our impact and inclusivity story,” said Brown.

Nordstrom intends to grow private brands, though Brown declined to specify any figures on the business or what percent of the company’s total volume could be presented by private brands.

“There are four really big reasons” for building the private brand volume and offering, Brown said. “Our customers love our brands. They shop more and spend more when they buy Nordstrom Made brands. That to me is the biggest reason. Then we get complete control over the distribution and it’s exclusive. With our customers changing values, they’re really clear about what they care about. We can make brands and products to cater to all of their needs. And of course, it’s wildly more profitable, and the return rate is much lower than our non-Nordstrom Made brands.”

There is risk in the long lead times required to design and develop private brands, but Brown said, “We have more flexibility than we’ve ever had. While working on Open Edit during COVID-19 our sourcing and development team was working on closer-to-home production systems, in our country, Mexico and Guatemala. About 10 percent of our production is in the U.S., but we knew that to get after some trends, we needed that to scale. I see a path forward to increase our closer-to-home production.”

With basics such as towels, it can be a program with a one- or two-year lead time. “It’s that fashion part of the mix that we want to have closer to home,” Brown said. Moving production closer to home “takes more of a buildup. It’s like a start-up because people are just starting to get back into manufacturing. It takes a lot of time to nurture those relationships. You lose some in the initial markup when you work this way but you gain it on the back end because if you are making something in 10 days, you hit the customer demand. So it’s worth the tradeoff, not to mention the environmental benefits” associated with reduced shipping.

Brown cited other Nordstrom Made goals for 2025, among them that 50 percent of Nordstrom Made products come from sustainably sourced raw materials and ensuring that 15 percent of the assortment qualifies for Nordstrom’s “sustainable style” program which makes it easy to shop consciously manufactured products. The company is also shooting for 90 percent of its products to be factory traceable by 2025 and is on track to achieve that goal ahead of schedule.

In 2020, 64 percent of Nordstrom Made product volume was produced in factories using the Higg Index Facility Environmental Module and it’s expected that it will reach 100 percent in 2021. The Higg Index is a standardized supply chain measurement tool to help brands, retailers and manufacturing facilities understand their environmental, social and labor impacts. In addition, 32 percent of Nordstrom Made products are manufactured in factories that invest in women’s empowerment reaching 40,000 workers and the goal is to up that to 90 percent.

“About two years ago, we said we needed to overhaul our brand portfolio and understand what is really important to customers, employees and people working in our factory base,” Brown said. “It became clear that to us that inclusivity and impact were two pieces of the ‘Nordstrom Made’ pillar we needed to focus on. It has massive appeal to our customers and our employees.”

Source : https://finance.yahoo.com/news/bringing-relevance-soul-sharper-focus-130054683.html

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