Why did Nordstrom close Trunk Club?
Nordstrom recently disclosed that it has shuttered Trunk Club, but has no plans to deemphasize personalized styling.
“I want to be clear,” said Erik Nordstrom, CEO, on Nordstrom’s first-quarter analyst call. “This move reflects our belief and commitment to styling, and we are dedicated to growing and investing in these services. We have a range of styling services from low-touch outfit inspiration through our digital channels to a high-touch and personalized relationship with a stylist, all of which achieved high customer satisfaction scores. We are directing our investment toward these programs to ensure that we are well-positioned to serve customer needs and drive growth.”
Mr. Nordstrom added that customers spend seven times more and report higher levels of satisfaction when engaging with a stylist, either in-store or online. Mr. Nordstrom added, “While we still see the highest number of customers engaged with our in-person styling, we are seeing rapid growth within our digital services. We continue to leverage data science and advance our digital tools, including virtual Style Boards, to empower our stylists with highly relevant recommendations for their customers.”
Nordstrom acquired Trunk Club in 2014 for $350 million as apparel subscription box services were gaining traction.
Trunk Club users filled out a styling quiz to help stylists come up with 10 to 12 items to send to their homes. Users had five days to try and send back items they didn’t want. A $25 styling fee could be used as a purchase credit. Competitors include Stitch Fix, Wantable, Le Tote and Dailylook.
By 2016, Nordstrom took a write-down on Trunk Club due to lowered profitability expectations. In 2020, the retailer closed six Trunk Club styling clubhouses and folded them into nearby Nordstrom locations.
Broader concerns about apparel subscription services arose beginning around 2018 when Stitch Fix’s active client growth began slowing.
Styling services are still receiving investments. In January, Saks unveiled Saks Stylist, a complementary personal stylist online service in partnership with Wishi, a styling app.
In March, Macy’s introduced an “Own Your Style” online platform that includes data-driven recommendations and advice from Macy’s Style Crew, the retailer’s internal group of paid influencers.
- Nordstrom (JWN) Q1 2022 Earnings Call Transcript – Refinitiv Streetevents/Nordstrom
- Nordstrom Is Shuttering Trunk Club – Business Of Fashion
- Nordstrom Will Bring Trunk Club To Stores, Putting A 21st-Century Spin On Personal Shopping Services – Forbes
- Why Nordstrom Is Closing Its Trunk Club Business, Two Years After Shuttering All of Its Stores – Footwear News
- Saks Unveils Advanced Personal Styling and Shopping Services Powered by Wishi – Saks/Business Wire
- Macy’s Introduces Its Brand Platform: Own Your Style – Macy’s
DISCUSSION QUESTIONS: Is Nordstrom’s closure of Trunk Club more about the challenges of running apparel subscription services or overall demand for online styling advice? Can AI-driven online styling advice rival the benefits of in-store advice?