Nordstrom reported a healthy 23% boost in ecommerce sales for the second quarter, accounting for more than a 3rd of the company’s total sales, which were up 7% over in 2015. The business reported $162 million in earnings for the quarter, up 46% from $110 million in 2017.
“We had robust digital sales growth for the quarter, showing our market leading existence and considerable progress toward our long-term goals,” said co-president Blake Nordstrom on a profits call. “We remain on track for 2018 to be an inflection point for successful development.”
Nordstrom saw sales gains of over 25% in its Nordstromrack.com and Hautelook.com ecommerce websites. Sales from Nordstrom Rewards members represented 58% of Q2 sales, up from 56% in 2015.
“When customers engage with us across stores and online, on average they invest five times more and success per consumer doubles,” Nordstrom stated. “Through our focus on our top markets we’re integrating the scale of our national infrastructure with our regional possessions of individuals, item and place to drive increased customer engagement and gain market share.”
Nordstrom said the company is starting in Los Angeles, its largest market. It will bring all its digital and physical possessions together and continuing to purchase supply chain as well.Comp sales
increased 4% in Q2, driven by growth across both full-price and off-price items. Full price saw a 4.1% compensation gain. The company also saw a heightened shift of clients shopping online during its anniversary sale from July 20-Aug. 5.
“Digital sales accounted for more than 40% of our occasion,” Nordstrom stated. “On the very first day of early access for our Nordstrom cardholders, we had our biggest day ever online, surpassing our previous record by 80% at 10 times our typical day-to-day demand.”
Nordstrom stated while the business strove to manage its systems for peak demand, it did experience website concerns due to unmatched levels of need on the first day of the event. “While our group resolved this, we understand we dissatisfied many of our customers and in reaction we provided cardholders 10 points per $1 on purchases made on the first day of the anniversary,” he said.From a merchandising viewpoint, Nordstrom’s collaboration with brand names enhance its product margin. Sales from strategic brands grew 13 %in Q2, representing about 45% of its full-price business.Nordstrom said the business has determined websites for its West Coast fulfillment center, scheduled to open in late 2019. “These investments in our supply chain network will help us address our opportunities to much better serve clients, improve our performances and take advantage of inventory in our local market,”he said.In July, the company stated two new local idea stores will open in Los Angeles this fall.
They represent part of Nordstrom’s regional market strategy to engage with consumers through enhanced services such as buy online pickup in store, alterations, store reserve and individual styling.
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