Another Industry Force: Complementors
“Your wardrobe should complement your skill set, never detract – or distract – from your assets.”
– Nina Garcia
Professors Adam Brandenburger and Barry Nalebuff consider one firm to be a “complementor” of another firm if your customers value your products more when they have this other firm’s product than when they have your product alone. So, how does this idea of complementors translate to the fashion industry–one that seems to be fiercely saturated with competitors instead? For Nordstrom, Inc., the answer to this question lies in the value of diversification and extraordinary partnerships.
It was all about “the very best service, selection, quality, and value” for Mr. John W. Nordstrom, Founder, who believed that success was sure to come when he entered into his very first partnership with a Seattle shoemaker named Carl F. Wallin. The two opened their very first store in 1901. The partners continued to grow the brand by opening a second store in 1923 and eventually passed the company over to their sons who were responsible for managing eight locations and expanding into the women’s clothing market by the 60s, with the third generation of Nordstroms further expanding the brand all across the U.S. for the next three decades.
At the turn of the millennium in early 2000 after building the brand for nearly 100 years, Nordstrom, Inc. entered into a number of strategic partnerships. The company first owned an upscale European men’s and women’s collection from 2000 to 2007 and then acquired HauteLook in 2011. Nordstrom then began offering personal styling services to customers when the company acquired Trunk Club in 2014, and it launched its own private label Treasure & Bond in the same year.
I think its safe to say that anyone who continues to shop at Nordstrom does so because of its wide selection of styles and other unique items offered to customers at an affordable price. For me, its all about the brand collaborations which make shopping at Nordstrom a one-stop shop. Need a new work bag for that dream job you just landed? Kate Spade or Tory Burch can be found at Nordstrom for a fraction of their retail cost. Looking to update your wardrobe with a power suit and heels for your big presentation next week? Nordstrom has you covered with brands like Madewell and Steve Madden. Oh, and don’t forget your lipstick so you’ll feel confident and well put together in front your bosses and the executive team! Grab the newest shades from MAC or Charlotte Tilbury before you checkout.
See, that’s the thing about Nordstrom… They are utilizing partnerships with popular brands ranging from Designer handbags, men’s and women’s fashion, shoes, and beauty to complement the Nordstrom name. As argued in the textbook, “an important difference between complementors and competitors is that a firm’s complementors help increase the size of a firm’s market, while a firm’s competitors divide this market among a set of firms.” Whereas if these brands opened their own store fronts in every city where there is a Nordstrom or Nordstrom Rack, the they would be fiercely at odds with each other over gaining and retaining customers, but complementing each other allows both companies to flourish more efficiently. Nordstrom promotes exposure to these brands and helps to develop customer loyalty while these brands also provide value to the Nordstrom name by making it a place of the very best service, selection, quality, and value!
Styled Strategy 