The company must balance the technological requirements with its human side of customer service. Social -- Nordstrom caters to a special kind of customer; one who wants high quality, more exclusive items that are environmentally sound, but of the quality that will last. In recent decades the social climate of America resulted in a greater percentage of questionable returns (gowns or shoes worn once or twice and then returned), but the company has managed to endure this paradigm shift.

Competitive -- The competitive market for the consumer's dollar has grown dramatically. In most major cities there are 2-3 upscale retailers, of which Nordstrom is one. Nordstrom seems to maintain its competitive edge with its Customer Service mentality and reputation as well as attention to detail and quality.

Economic -- Nordstrom is sensitive to the economy. The recent recession showed its Rack and web-based sales up about 15%, but its retail profits down 21% at the brick and mortar stores. Still, during harder economic times there remains a customer base that will still pay for quality and longevity (Fortune 500-2010 - Rank 270, 2010; Miller, 2008; Perner, 2008).

Discuss the positive or negative impact of the forces of marketing the department store.

Using Michael Porter's Five Forces Model, we find that Nordstrom...

It is certainly more than their tenacity that causes continual growth, and their ability to spend millions of dollars on new stores during a down-economy (Porter's Five Forces and SWOT, 2001)
Existing Companies -- By maintaining market

Potential New Companies -- Smaller niche companies that import certain very specific items might compete for a very small percentage of Nordstrom dollars, but it is unlikely that any will arise with the same reputation and buying power.

Substitutes for Products Offered -- Clearly, there is a multi-billion dollar market for top of the line imitations from the Target and Wal-Mart segment. However, this is not really a loss of business for Nordstrom, since the demographic that shops for items like this are typically not Nordstrom shoppers in the first place.

Suppliers/Supply Chain -- This is one particular area in which Nordstrom excels. Because of their longevity, they have developed relationships over generations with some of the top clothing and retail manufacturers globally.

Customers -- Nordstrom was built on customer service and likely retains its edge on the same. While the customer has psychographic ally changed; less loyal, more willing to return an item, the steadfast support of Nordstrom's core value gives it