Nordstrom: Care About the Customer...Or Say Bye-Bye

Legendary tales of customer service are rarely as sexy as iconic moments in entertainment and sports, but their impact on the way we envision a business can be just as profound.

Such is the case for Nordstrom’s "tire story," which continues to set the bar for customer experience professionals.

As the legend goes, a Nordstrom store once accepted a return for a tire—and provided a full refund—that the customer bought somewhere else. A true testament to customer-centricity, Nordstrom took a direct financial hit to give the customer what he wanted.

Much in the same way legends of the field, stage and screen earn themselves a perpetual megaphone to offer advice, when Nordstrom talks customer management, people listen.

And did Nordstrom ever talk at the 2012 shop.org conference!

Doing little to mince words, Nordstrom’s executive vice president Jamie Nordstrom cautioned the attending retailers, "Companies were in control even up until 2000. But now the customer is in the driver's seat. If you embrace that, you will thrive. If not, then by 2020, you will not survive!"

Asking a brand to deliver the experience its customers most desire is far from a new proposition. In this "age of the customer," brands are constantly informed that if they do not act in their customers’ best interests, someone else will.

Unfortunately, negative consequences of that incessant reminder rarely rear their ugly heads. Whether due to difficulty switching brands or the fact that customers are not as adamant about customer-centricity as the media would have brands believe, many companies are able to neglect customer best interest without enduring any tangible business impact.

But Nordstrom’s caution serves a reminder that brands should not mistake present-day success for perpetual immunity. As customers continue exploring new channels and developing loyalties to the services offered by elite brands, their expectations—and awareness of options—will dramatically improve. They will develop habits and preferences around innovative new customer experience initiatives, and they will have no choice but to command all service providers to engage in those initiatives.

In the short-term, many brands can avoid the pitfalls of poor customer service because the value of their offerings—and the general experience associated with those offerings—provides enough compensation. Customers might recognize imperfections in the service they receive, but as long as the overall experience is in line with their most important priorities and expectations, they are less likely to penalize the brand—especially when alternative options are elusive.

As customer preferences evolve, however, brands distanced from the voice of the customer will become increasingly less attractive and thus increasingly hard to tolerate for customers. There is a vast difference between imperfection and incompleteness, and while mistakes can affect even the most customer-centric brands, only those unwilling to let customers "drive" risk completely missing out on what makes customers loyal.

Allowing the customer to "drive" means allowing the customer to dictate the pace of innovation and strategic development. It means customers should not be happy that a brand is trying to accommodate them; brands should be happy that customers are willing to indulge them. And in appreciation for that indulgence, brands should not only strive to keep up with the standard—according to Nordstrom, brands must strive to be the best at every touch point…in the customer’s eyes.

If, as the eConsultancy summary notes, customers begin to internalize Amazon.com’s personalization services or Apple’s in-store technology services as signals of customer-centricity, they will increasingly hold retailers accountable for those options. And they will prioritize those retailers who best deliver on those tenets.

Brand representatives might be able to get away with being less friendly than Zappos in the short-term, but as companies repeatedly interact with Zappos’ friendly reps and free return policy and accept those elements as the standard, brands will need to go above and beyond those thresholds in order to demonstrate continued customer-centricity.

The customer experience is defined not only by the interaction between brand and customer on a given day but on how the brand shapes itself to the needs of its individual customers over time. The more corner-cutting a brand does now, the more removed it will be from those needs as they become so evolved that the "old way" of customer service is no longer acceptable.