Global Marketing Presentation
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![Page 1: Global Marketing Presentation](https://reader030.fdocuments.in/reader030/viewer/2022020203/58879a271a28ab5b1a8b6845/html5/thumbnails/1.jpg)
Amany Hamza,21202244
Jonathan Ellis,21153283
Kavi Johal,10280251
Michael Sirch21 20 56 40
BY
2013
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Agenda
Executive Summary
Nordstrom Overview
Introducing Nordstrom;
Situation Analysis;
Financial Analysis
The Global Nordstrom
Our Mission and Objectives;
Market Analysis: Brazil, UK
Market Entry: Brazil, UK
Recommendation;
Conclusion.
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Executive Summary
1901: Founded as a
shoe store by Johan
Nordstrom and Carl
Wallin
1998: Nordstrom.com
launched
2009: First
International
online orders
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Nordstrom Rack Group
121 Stores
Nordstrom Credit
Group
NordstromFull Line Group
117 Stores
Nordstrom DirectGroup
Other retail: HautLook, Jeffery Boutique and charitable store
COMPETITORS USA
NORDSTROM OVERVIEW
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Executive Summary
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Situation Analysis
Customer Store Design Production Team
“We put our customers at the heart of
everything we do and are truly
passionate about the
products that we sell.”
“Meeting point between our customers and Nordstrom fashion selling points.” Operates 242 stores, 31 states, Store modernisations, Good visual
merchandising and product presentation,
Efficient distribution of supply chain
“A unique, differentiated
product offer at affordable prices.” A range of Apparel(casual, formal wear),
Shoes, Accessories. Product
Standardisation.
“The right teams to deliver
sustainable competitive advantages through the best practice
across the business.”
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10.0%
10.5%
11.0%
11.5%
12.0%
12.5%
13.0%
13.5%
14.0%
200
8
201
0
201
2
INCREASED ROICINVESTED $2B CAPITAL OVER
LAST 5 YEARS
ROIC
YOY Growth %
(2012 53 week vs. 2011
52 week)
Q3 YTD Q4
Sales 11% 13%
EBIT 2% 20%
EPS 8% 26%
Financial Highlights 2012
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Global NORDSTROM MISSION
A
A Global Leading
Merchandiser
Multi-Channel
In an appealing
shopping
environment,
whether in
Store and
Dynamic
Online sites.
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GLOBAL NORDSTROM
AT A GLANCE
We are committed to meet
the needs of all our
stakeholders in everything
we do. With compelling
merchandise and an
unyielding commitment , we
are the retailer that
customers trust.
Our Vision
"At Nordstrom,
we value the
richness that diversity
brings to our
workforce - it makes
our Company better
and the communities
we serve stronger.“
Our Values
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Develop a good base for the future in a challenging
market
Secure long term profitability
Develop a niche position with 5% year on year growth
for the next three years
Establish a consistent brand globally
Budget $2.5m
Objectives
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GLOBAL NORDSTROM Positioning
Fast High
Fashion at
Affordable
Prices
NORDSTROM
Market Leader
Our Breadth of
Appeal is Our
Customer-
Centric
Perception
Retention
CRM
Self-expression
Membership
Search engine
optimisation
More ways to shop
Acquisition
Satis
fac
tion
Pro
mo
tion
Customer Loyalty Approach
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•Outstanding flagship stores, wide space layout
•High store loyalty
•Online
•M-commerce
• Billboard
• Social Media
• Internet Marketing
• NUS discount
•Market Penetration
•Competitive Pricing
•Membership
•Brands
•Core Lines
•Product Standardisation
•USP: Vibrant fashion trend Product Price
PlacePromotion
Marketing Mix
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Integrated Marketing Communication Mix
Social Marketing
Customer-focused
Positioning
Promotion
Holistic
Approach
Brand Equity
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BRAND ESSENCE MODEL
Brand
Essence
Fashionable and Flattering Clothes
Own Brands
Featured Brands
Designers Collections
Concessions
Attributes
Benefits
Finest Apparel
Vanity sizing
Fashion Rewards
Values
Everyday Value
Liberal Return Policy
StoreCard
Offer and sales events
Personality
Personal Stylist
Fashion-Friendly
Feminine
Full-Shaped Body
Store experience
High-Street Fashion
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Speaking with one voice
Bra
nd
Tac
tics
Customer-Based Brand Equity Pyramid
ResonanceLoyalty
Engagement
Community
FeelingsCool
Fun
Excited
Timeless
JudgementsBrand credibility
High Quality
Value Proposition
ImagerySelf-Selection
Buying pattern
PerformanceAffordable Prices
Customer Care
SalienceLiked by all consumers in target segment
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NORDSTROM
Own Brands
Designer Brands
Direct
Rack
Personal
Selling
Sales Force
Sales Promotion
Continuity / Frequency
Loyalty Programs
Social Media Networking
Pay per click Advertising
Unique Fashion -
Merchandise
The Brand Promise
Target Audience
Promotional Communication
(Push – Pull Marketing Mapping)
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BRAZIL
FULL-LINE
UK
RACKRACK
Market
Share 5%
Expected sales mix impacted by
Rack, Full-Line for Brazil and UK growth
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Strategic Focus
Raise profile of the Nordstrom brand in the UK and Brazil through Rack and Direct channels.
Improve customer experience to strengthen customer loyalty.
Continue global expansion through local partnerships.
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Market Analysis and Entry - BRAZIL
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Porter’s 5 Forces- Brazil
Industry Rivalry
Moderate
Competition
Substitutes
• High
competition
• Low switching
costs
Buyers
• Price sensitivity
•Low switching
costs
Suppliers
• Many suppliers
• Logistics
• Low switching
costs
Potential Entrants
• Low entry
barriers
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PESTEL Analysis Brazil
Economical
Upper-middle income
country
GDP:
$2.477 trillion
GDP-Ranking:
7
Unemployment rate:
6.0
Inflation rate – all
items:
6.6
Social
•Population: 196.7 million
•Population growth rate:0.9
•Life expectancy: 73
•Overweight and obese aged 15 and over: 48.1
Technological
•Households with access to the internet::37.8
SOURCES: Worldbank (2013),
OECD (2013)
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SWOT Analysis: Strengths
Innovators in technology for merchandising and tracking i.e. Personal Book, & register systems.
Known for yearly Anniversary Sale, which earns more revenue in one week than all of the holiday shopping season, making for very successful second and third quarters.
“Forbes 100 Best Companies”.
Nordstrom Rack’s revenue has grown consistently over last 3 years:
0
500
1,000
1,500
2,000
2,500
2009 2010 2011
$ (m)
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SWOT Analysis: Weaknesses
Product Portfolio %age
Women's apparel
Shoes
Men's apparel
Women's accessories
Cosmetics
Childern's apparel
Other
• Room to grow in the
Children’s apparel
category.
• Men’s apparel is a
potential area that
Nordstrom Rack does
not market to enough.
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GAP Analysis Brazil
0
1
2
3
4
5
6
Nordstrom
Arezzo
C&A
Marisa
Hering
Zara
Gap
H&M
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Hofstede Analysis - Brazil
0
10
20
30
40
50
60
70
80
90
100
PDI IDV MAS UAI LTO
Brazil
UK
• Individualism score of 38.
• Integrated into strong,
cohesive groups (especially
represented by the extended
family).
• Important to build up
trustworthy and long lasting
relationships.
• Power Distance Score of 69.
• The different distribution of
power justifies the fact that
power holders have more
benefits than the less powerful
in society.
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Brazil Macro Culture
194M
Population (40% under 20)
$2.3Tr
Salvador6th largest economy in the world
São Paulo
Portuguese
Brasilia
Strong democracy
Rio de Janeiro
Strongest Industries
AgricultureMiningManufacturingServices
PortugueseAfricanIndigenousOther European
Cultural Influences
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Brazil Pricing
Brazilian Goods
Imported Goods
Source: pwc.com
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Segmentation
Target richest cities in
wealthiest states:
Sao Paulo
Bahia
Belo Horizonte
Curitiba
Rio de Janeiro
Wealth
distribution
density by
state
Source: bookofezekiel3.wordpress.com
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Demographic Segmentation
194MPopulation (40% under 20)
$2.3Tr Salvador
6th largest economy in the world
São Paulo
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Brazil – Social Media
65mil
33mil
Largest social media capital in the
world
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Market Analysis - Brazil
Target richest cities in wealthiest states:
Sao PauloBahiaBelo HorizonteCuritibaRio de Janeiro
Source:
latinlink.com
sophiamind.co
m/
R$
27
bnth
enfn
Class C
18-24
71% of
income on beauty & fashion
R$ 19bn Spent on fashion and beauty each year
Beauty Market
X51996-2010
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Brazil Target Market
Target richest cities in wealthiest states:
Sao PauloBahiaBelo HorizonteCuritibaRio de Janeiro
Source:latinlink.com
Target Audience: Class C
Online consumers
14-28 year old women
Teenagers with expendable income
Fashion conscious young professional women
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Brand Awareness - Physical
Spend more per capita than any other nation
$43.3m per day
Injected $5.9bn into U.S economy in 2010 an average of $5,400
per Brazilian
Brazilians that shop in the US recognise the
Nordstrom brand
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Customer Life Cycle - Brazil
• Use analytics from sales and social media to adapt the brand offering
• Re-introduce the brand using consumer intelligence previously collected
• Focus on trend changes and seasonal products to increase sales
• Introduce brand and generate interest through digital and physical marketing
Brand awareness
Stimulate
MonitorRetain
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Porter’s 5 Forces- UK
Industry Rivalry
Moderate
Competition
Substitutes
Low switching
costs
Buyers
Price sensitivity
Recession
Low switching
costs
Suppliers
• Many suppliers
• High
competition
• Low switching
costs
Potential Entrants
Low entry
barriers
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SWOT Analysis- Strengths
• Innovators in technology.
• Known for yearly Anniversary Sale.
• 11th in Interbrand.com top 20 US companies.
• Nordstrom sales figures have grown consistently over last 3 years:
0
2,000
4,000
6,000
8,000
10,000
12,000
2007 2008 2009 2010 2011
$m
Source: Nordstrom Annual Report 2011
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SWOT Analysis- Weaknesses
• Room to grow in the
Children’s apparel
category.
• Men’s apparel is a
potential area that
Nordstrom Rack
doesn’t market to
enough.
Source: Mintel 2012
%
Women's apparel
Shoes
Men's apparel
Women's accessories
Cosmetics
Childern's apparel
Other
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SWOT Analysis- Opportunity
• Expanding their children's line.
• Use the existing partnership with Topshop to their advantage for market entry.
• Enter UK and Brazil market with penetrative pricing.
• Use the UK as bridgehead into Europe.
• Online Shopping.
• (M- Commerce)
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SWOT Analysis- Threats
- Growth of online consumerism in the UK.
Website needs to be competitive.
- Rising taxes (business rates).
- Economic stagnation.
- Inflationary pressures in the supply chain.
- Competitor's:
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The Customer Attitudes towards buying clothes, March 2012
“Thinking in general about buying clothes, which of the following statements do you agree with?”
Source: GMI/Mintel
How Often do Women Buy Clothes?February 2011,
Base: 991 female internet users aged 16+
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0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
2010 2011 2012 2013 2014 2015
Source: Mintel 2012
£
m
UK Market Size- Mintel Forecast
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Target Audience- Physical Retailers
Source: Mintel 2012
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UK Target Market
Nordstrom Rack
- Location in Greater London.
- 16-24 year old students in full-time education.
Nordstrom Rack Online
- 16-24 year old students in full-time education.
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0
10
20
30
40
50
60
70
80
90
100
PDI IDV MAS UAI LTO
Brazil
UK
Hofstede Analysis- UK
• Long Term Orientation score
of 25.
• Businesses are focused on
short term quarterly goals and
quick results.
• Individualism score of 89.
• The affluence of Britain has
increased throughout the last
decade, with wealth also
‘spreading North’.
• Rise of rampant consumerism
and a strengthening of the
‘Me’ culture.
Geert-hofstede.com
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UK Macro Culture
194M
$2.2Tr
Manchester
7th largest economy in
the world
London
Portuguese
AgricultureMiningManufacturingServices
PortugueseAfricanIndigenousOther European
PoorClimate
EnglishGaelicWelsh
CatholicsProtestants
MuslimsHindusSikhsJews
Atheist
Birmingham
“Special” relationship with US
Constitution
al Monarchy
& Elected
Parliament
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Monitoring – why?
Variable
Customer Needs
Changing
environments
Profitability
Organisational
learning
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Monitoring –what?
Shareholder Value
Competitive Advantage
Customer Value
Brand Value
Cultural learning
Ethical behaviour
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Customer Value (1)
Customer Service
• Company webpage
• Service points/Staff
• Customer phone
• Quality Agents
Home delivery
(UK)
• Personal call (regular customers)
• Delivery app
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Customer Value (2)
Real product
• Online Product Ranking
• Data mining
• “My best dress award”
• “Fashion battle”
• Staff
• Casting shows/stars
• Fashion magazines
• Professional market
research
• Fashion scouts
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Brand Value
“Brand
equity
ten”
• Brand
awareness
• Perceived
quality
• Perceived
value
• Loyalty/satisf
action
• Collaboration
with
Interbrand
• Same sources
as for CV
• card system
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Shareholder Value
Budgeti
ng
Benchmarking:
• London – Sao Paolo –
New York
• Stores – “best of class”
store
ROI
Market share
Relative Market share
Ratios
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Competitive Advantage
Strategy Review
• 5 forces
• Resources and Capabilities
• SWOT
• STP
Observation
• Stores (Quality scouts)
• News (Information Manager)
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Cultural learning
Analysis review
• Cultural Framework
• Hofstede
• Hall
• Experiences
HR collaboration
Strategy meetings:
• Diversity view on strategy
• Training requirements
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Ethical behavior
Code of Ethics
• Report to HQ
• Guidelines.
• Challenges.
• Training
requirements.
Operational
• Store performance review
• Personal conversations with Ethical Officer and staff
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Data Collection
Internal
Loyalty card system
Intelligent till systems
Online surveys: Twitter/Facebook/INstagram
External
Collaboration with interbrand
Data sharing with OECD
and Worldbank and other
international organisations in
Brazil
Use of government statistics
in UK
Surveys with customers
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Ethical behaviour - updated version
Fashion scouts
Researchers
R&D &Production
Financial department
Customer phone
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Marketing Budget
Last updated:
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total
Personnel
Salaries, wages 200 200 $400
Benefits 0
Payroll taxes 10 10 10 10 40
Commissions and bonuses 20 20 20 20 80
Personnel Total $200 $10 $20 $10 $0 $30 $0 $0 $30 $0 $200 $20 $520
Market Research
Primary research 10 10 10 10 10 $50
Secondary research 10 10 10 10 10 10 10 70
Market Research Total $10 $10 $10 $10 $10 $10 $10 $10 $10 $10 $10 $10 $120
Marketing Communications
Branding 30 20 10 10 $70
Advertising 100 50 50 30 20 15 265
Web sites 10 10 10 30
Direct marketing 20 20 40
Collateral 0
Press relations 5 5 4 4 10 28
Public relations 5 5 5 5 5 10 35
Analyst relations 2 2 4 2 2 4 16
Events 50 30 40 120
Marketing Communications Total $172 $102 $119 $25 $2 $4 $35 $0 $41 $20 $20 $64 $604
Channels
Channel communications and training 50 50 20 10 10 10 $150
Channel promotions and incentives 10 10 10 10 16 10 10 10 60 60 70 276
Channel commissions/bonuses 0
Channels Total $60 $60 $30 $10 $16 $20 $10 $10 $10 $70 $60 $70 $426
Customer Acquisition & Retention (CAR)
Lead generation 10 10 10 10 10 10 10 $70
Customer loyalty 20 10 10 10 10 60
CAR Total $20 $10 $10 $10 $10 $10 $10 $10 $10 $10 $10 $10 $130
Other
Postage 10 10 10 10 $40
Telephone 10 10 10 10 10 50
Travel 150 100 100 100 50 50 550
Computers and office equipment 20 20 20 60
Other Total $170 $110 $10 $130 $0 $10 $10 $10 $120 $10 $60 $60 $700
Total Marketing Budget($000) $632 $302 $199 $195 $38 $84 $75 $40 $221 $120 $360 $234 $2,500
Marketing Budget Plan
11/02/2013
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Product-Market Growth Matrix – Ansoff Outperformed Present Products (casual wear,
formalwear, shoes, accessiores),
Maximise Brand Roll out,
Growth Opportunities in new markets.
High
Market Growth
Low
QUESTION MarkA good market but will the product do well in it?
StarProducts that are doing well quickly.
DogStruggling in a slow market.
Cash CowContinuing to do well in an established Market.
Low Market Share High
NO
RD
STRO
M M
arketing Strategies Boston Matrix
ChallengesConvert the Question Marks and Stars into Cash
Cows of the future
Manage the Dogs
The profits earned from Cash Cows can be used to
develop and promote Stars and Question Marks.
Exiting New
New
Exit
ing
Ma
rke
t
Products
Market Penetration
Product Development
Market Development
Diversification
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Sales
Time
(1)
B C
D
A
(2)
(3)
Portfolio (A – Rack) is at
Maturity stage – cash cow.
Generates fund for the
development of Portfolio (D-
Multi-Brands)
Cash from Portfolio (B – Full
Line) is used to support Portfolio
(C- Featured Brands )through
growth stage and to launch
Topshop Exclusivity. The Rack
now possibly a dog?
Cash from Portfolio (C-
Featured Brands ) is used
to support growth of
Portfolio (D- Multi-
Brands) and possibly
finance extension strategy
for B?
Product Life Cycle and the Boston Matrix
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Contingency Plans
Outlet
Store
Scrap /
Recycle
Last
chance
clearance
Ceasing
Business
Joint
Venture
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Recommendation and Conclusion
UK
High quality merchandise sold at discounted prices to students in Greater
London aged between 16-24.
UK market size predicted to grow to £7bn in 2015. This with recession
means that consumers will want to spend money if they feel it is 'worth it'.
Consumers have all the bargaining as there are so many organisations
competing against each other.
Brazil
Growing digital consumption and relatively slow uptake by competitors
creates a significant gap in the Brazilian retail market for quality products
Attractive market: Brazilian economy is strong, has a developing middle
class with expendable income and a young population
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Recommendation and Conclusion
TimeLine:
The market entry needs to be heavily promoted
during the holiday season. This is when
consumers are doing most of their shopping.
We foresee that Nordstrom will dominate these
two markets if we focus on young fashion with
tasteful styling at affordable prices.
The efficient execution of our global marketing
model will lead Nordstrom into the Fashion
market with more expansion plans in other
countries in the near future.
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References1. Answers, (online), available at: http://www.answers.com/topic/nordstrom-inc #
2. BBC, (online), available at: www.bbc.co.uk
3. Ceasing a business in UK regulations, Growing Business, (online), available at: http://www.growingbusiness.co.uk/the-cost-of-closing-down-a-business-has-gone-up.html
4. Clothing Retailing Market Report 2012, Keynote, (online), available at: https://www.keynote.co.uk/market-intelligence/
5. Forbes, (online), available at: http://www.forbes.com/sites/lydiadishman/2012/02/20/nordstroms-savvy-sales-strategies-for-stellar-growth/
6. Geert, (online), available at: www.Geert-hofstede.com
7. Interbrand, (online), available at: www.interbrand.com
8. Microsoft Advertising- Clothing & Footwear Trends, Adam Goodman, May 2011.
9. Mintel Report- Fashion Online – UK – March 2012.
10. Nordstrom Annual report 2011
11. Nordstrom Retail Marketing BA 495 (online), available at:
12. 2. PR Web, (online), available at: http://www.prweb.com/releases/retail/fashion/prweb10494886.htm
13. The Brand wheel, (online), available at: www.therightgroup.com.au
14. UK Trade and Investment, (online), available at: http://news.bis.gov.uk/imagelibrary/downloadmedia.ashx?MediaDetailsID=6389&SizeId=-1
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References
15. arezzo.com.br/inverno2013/
16. bloomberg.com/news/2013-01-15/brazil-november-retail-sales-rise-for-sixth-straight-month-1-
.htm
17. bookofezekiel3.wordpress.com/2010/03/19/dear-president-luis-de-silva-its-good-to-share-
proportional-to-population/
18. cea.com.br/
19. Chee, H Harris, R. (1998). Gap Analysis. In: Chee, H Harris, R Global marketing strategy.
London: Financial Times Pitman Publishing . 71
20. cia.gov/library/publications/the-world-factbook/geos/br.html
21. comscore.com/Insights/Presentations_and_Whitepapers/2013/2013_Brazil_Digital_Future_in_
Focus
22. comscoredatamine.com/2010/10/orkut-facebook-and-twitter-growth-in-brazil/
23. en.wikipedia.org/wiki/Brazil
24. Nordstrom Investor Relations - http://phx.corporate-ir.net/phoenix.zhtml?c=93295&p=irol-
irhome
25. forbes.com/sites/ricardogeromel/2012/03/23/brazils-e-commerce-is-booming-record-breaking-
figures-in-2011-growth-of-26-earnings-of-11-bi/
26. gap.com/products/womens-clothing.jsp
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References15. hering.com.br/
16. hm.com/gb/
17. huffingtonpost.com/2012/03/11/brazilian-spending-us_n_1337354.html
18. huffingtonpost.com/brian-honigman/100-fascinating-social-me_b_2185281.htm
19. institucional.geravd.com.br/arquivos/acontece/WebShoppers.pdf
32. instituteofcustomerservice.com/1711-8843/The-UK-Customer-Satisfaction-Index-January-
2012---executive-summary.html
33. just-style.com/analysis/zara-grows-in-brazil-while-gap-and-hm-dither_id112354.aspx
34. kpmg.de/docs/Folder_Market_Entry_ing-Final.pdf
35. latinlink.usmediaconsulting.com/2011/11/what-brazilians-buy/
36. lib.utexas.edu/maps/americas/americas_pol96.jpg
37. luxuryinstitute.com/blog/?p=2310
38. marisa.com.br/
39. online.wsj.com/article/SB10001424127887323301104578257950857891898.html
40. pwc.com/en_GX/gx/retail-consumer/pdf/brazil.pdf
41. socialbakers.com/facebook-statistics/brazil
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32. sophiamind.com/en/research/beauty/women-are-satisfied-with-the-beauty-products-
available-today-however-they-are-not-loyal-to-specific-brands/
33. Thompson Reuters Street Events – Nordstrom at Bank of America Merrill Lynch
Consumer and Retail Conference
http://www.google.co.uk/url?sa=t&rct=j&q=&esrc=s&source=web&cd=1&ved=0CDQQFjA
A&url=http%3A%2F%2Fphx.corporate-
ir.net%2FExternal.File%3Fitem%3DUGFyZW50SUQ9MTc1ODI3fENoaWxkSUQ9LTF
8VHlwZT0z%26t%3D1&ei=9jRUUfveM8G1PZ3FgcAF&usg=AFQjCNFzAsh3W9As7rK
F4gAWEujdxUH1iA&sig2=5k0TOzwYYKZCyg1hUkPqmQ&bvm=bv.44342787,d.ZWU
&cad=rja
34. time.com/time/world/article/0,8599,2075717,00.html
35. zara.com/webapp/wcs/stores/servlet/home/uk/en/
References
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Back-up
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Financial Summary
Added +$1B in sales
THREE CONSECUTIVE YEARS
Nordstrom
Rack $2bn
Nordstrom Rack Income Generated
2011
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Brazil – Retail expectations
Latest fashion
Pay in instalments
One-on-one customer
service
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Brazil – Retail Customs
Latest fashion
Prefer shopping
malls
Shop in groups
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GAP Analysis UK
0
10
20
30
40
50
60
70
80
90
100
Nordstrom
GAP
H&M
Zara
Next
TK Maxx
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0
10
20
30
40
50
60
70
80
90
100
PDI IDV MAS UAI LTO
Brazil
UK
Hofstede Analysis- UK
• Long Term Orientation score
of 25.
• Businesses are focused on
short term quarterly goals and
quick results.
• Individualism score of 89.
• The affluence of Britain has
increased throughout the last
decade, with wealth also
‘spreading North’.
• Rise of rampant consumerism
and a strengthening of the
‘Me’ culture.
Geert-hofstede.com
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Hofstede Analysis - Brazil
0
10
20
30
40
50
60
70
80
90
100
PDI IDV MAS UAI LTO
Brazil
UK
• Individualism score of 38.
• Integrated into strong,
cohesive groups (especially
represented by the extended
family).
• Important to build up
trustworthy and long lasting
relationships.
• Power Distance Score of 69.
• The different distribution of
power justifies the fact that
power holders have more
benefits than the less powerful
in society.
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“Brand equity ten”
Differentiation
Market priceBrand awareness Loyalty
Popularity
Market share
Perceived value Perceived quality
Brand personality
Organisational associations