A:

Nordstrom (JWN) is a high-end retail sales department store offering fashion, shoes and accessories for men, women and children. A smaller portion of Nordstrom's revenue is generated by use of Nordstrom brand VISA credit cards. The retailer brings these two business segments together by building customer loyalty and increasing revenue with credit card offerings.

Nordstrom has notable competitors in the retail industry that offer high fashion in a similar department store format. Other retailers specializing in high-end fashion include Macy's (M), Dillard's (DDS), Neiman Marcus and Saks.

Ranking highly in popularity surveys among fashion-focused consumers, Nordstrom is known by many customers for high-quality customer service. Many competitors have adopted a stronger emphasis on personalized service after seeing the results Nordstrom achieved by consistently applying service as a growth strategy. Venturing into new technology and applying this new technology in customer-centric ways presents an ongoing challenge and opportunity for Norstrom and other high-end department stores.

Since 1995, Nordstrom continually ranks highly in customer service surveys. In virtually every year of the American Consumer Satisfaction Survey, Nordstrom ranked as the consumer fashion retail industry leader in service quality. Applying this customer service knowledge to technology proves to provide retailers such as Nordstrom with a competitive advantage.

As retail sales shift to online stores, retailers that are attentive to their online shopping segments benefit the most. Nordstrom continues to focus on improving customer experiences online to increase sales, obtain new customers and retain existing customers. Growth in online fashion retail increasingly brings opportunities for Nordstrom and competitor retailers. Nordstrom plans to continue investing heavily in online technologies and order fulfillment. Many competitors are also investing in this area and seeing significant results. Improving store inventory systems to function seamlessly with online retailing has improved sales for Nordstrom and provided a competitive advantage over Macy's and Saks.

While a distinct segment of Nordstrom, Nordstrom credit cards are used by the company to support retail sales and build store traffic. The luxury retailer operates a national banking segment offering Nordstrom VISA cards, a VISA debit card and a private label card that can only be used in Nordstrom stores, Nordstrom Rack stores or online at Nordstrom's website. Nordstrom's primary competitors are in the retail segment, although Nordstrom VISA cards are accepted by any merchant that uses VISA, and therefore, Nordstrom VISA cards compete directly with other VISA card brands. This segment of Nordstrom includes a rewards program designed to encourage shopper loyalty and bring Nordstrom cardholders into the store. Shoppers with a rewards membership may receive other benefits when shopping in the store, such as free alterations to clothing purchases.

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