Test Out New Concepts

An article this week in The New York Times reports how Nordstrom, Inc. is testing the NYC market by opening a new store. The ways in which Nordstrom is doing this provide hints to other retailers about the value of testing and how to do it well.

• Be clear with consumers that what you’re doing is a trial. This reduces any negative effects on your store brand that might occur. If what you’re testing is poorly received, you’d like to control the spread of the negative impressions to your mainline image. Even if the new concept is very well-received, there is a danger in it diluting the personality your current store brand projects. The new Nordstrom-owned store doesn’t carry the Nordstrom name anywhere. It is called Treasure&Bond. However, Nordstrom is making no effort to keep the relationship secret. They’re publicizing it. The Treasure&Bond name is a signal that this is a test bed incubator.
• Earn good will from shoppers with the concept you’re testing. You’d like to ask consumers their impressions, using methods ranging from listening to the consumers to professionally designed and administered attitude surveys. To motivate the consumers, offer them something. Treasure&Bond aims to make shoppers feel good by announcing that all profits from operation of the store will be donated to charity. To maximize the effect, Treasure&Bond will rotate the charity recipients each three months and list the amount of donations on a website. Research at University of California-San Diego and Northwestern University supports the idea of not paying consumers directly for their opinions. The evidence is that doing so does not increase purchase likelihood as much as does offering good will in other ways.
• Keep the introduction modest in size, but extravagant in excitement. Treasure&Bond comes in at about 25,000 square feet instead of the typical 250,000 square feet for a Nordstrom department store. It might seem that the merchandising and ambiance are also intentionally modest: The store has exposed pipes and wooden shipping crates as display cases. According to The New York Times article, the clothes for sale come mostly in gray, black, and taupe. Nothing flashy here, you’d think. But the truth is that part of what’s being tested is the flash of funky. Word is the store concept was inspired by Vogue editor Anna Wintour, who also is said to have inspired the title character in the movie “The Devil Wears Prada.”

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