Nordstrom launches Canadian credit card
Nordstrom is launching a house-branded Visa card in Canada, aiming to drive up sales and encourage repeat shopping by giving customers added loyalty rewards incentives.
The news comes more than two years after Nordstrom’s debut in this country, where the upscale department store aims to more than triple its Canadian sales to US$1 billion as it expands in this market. Rival Saks, owned by Hudson’s Bay Co., introduced a house credit card with Capital One bank when it opened its first stores in Canada last year.
It also lands at a tumultuous period for retail department stores amid industry concerns about increasing numbers of customers shopping online.
On Friday, Nordstrom’s shares plunged more than 10 per cent after the retailer reported late Thursday a first-quarter samestore sales drop of 0.8 per cent, below analysts’ predictions for a 0.1 per cent sales slide at established stores.
Steven Mattics, president of Nordstrom’s credit division, said the retailer has been able to drive up sales by tailoring offers to consumers’ specific shopping habits based on data gleaned from its loyalty program.
“We look at (the data) rigorously and frequently and see what incremental sales we get from customers who have our cards,” Mattics said. “It is substantial.”
Members of the retailer’s Nordstrom Rewards program account for 44 per cent of sales at the department store chain, and typically spend three to four times more than non-rewards customers.
When Nordstrom opened its first Canadian location in 2014 it debuted a loyalty program — one not tied to a credit card — wherein members earn one point per dollar.
Now, “the majority of Canadian transactions” are accompanied by the loyalty card, Mattics said.
At 2,000 points, customers receive a $20 Nordstrom credit.
Holders of the new Nordstrom Rewards Visa card with MBNA will earn two points for each dollar spent at Nordstrom and one point per dollar on all purchases made outside of Nordstrom. Cardholders are entitled to bonus point events throughout the year and early access to its annual July sale.