Nordstrom & Dollar General: Lessons Learned
On consecutive pages in today’s Wall Street Journal, we read of Nordstrom’s 44% Q1 profit and Dollar General’s decision to add 600 new stores in 2010.
It would seem that upmarket consumers are tired of doing without and returning to Nordstrom in droves. Well almost. According to the story, fueling a lot of the Seattle-based retailer’s growth is a smart move to “accessible luxury” items … code for a wider assortment of budget-friendly merchandise.
Meanwhile, at Dollar General, CEO Rick Dreiling reported that the combination of value and convenience is driving sales. “Value means more today than it did two years ago, and no CEO thinks it is going to be like it was. We’re in a new spending norm,” Dreiling is quoted in the Journal. Interestingly, Dollar General is upgrading its non-consumable offerings by bringing in L’Oreal cosmetics and Hanes underwear.
These days, the most dangerous place to be is middle-market. No matter what your business, if there’s not a clear value message that’s understood by your core customer, your days may be numbered.
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