Nordstrom Upgrades Store, Online Technology as Part of $69 Million Spend

Upgrades to both in-store and online technology were part of $69 million Nordstrom spent on retail operations during the third quarter. While new stores and volume growth accounted for the majority of the increased retail SG&A [selling, general and administrative] spending, the remainder came "primarily from increased investments in online marketing and technology," according to Blake Nordstrom, the retailer's president.

"An example of the increase in technology would be the addition of WiFi capabilities in our stores," said Nordstrom during a conference call discussing Q3 financial results. "Having this technology in place gives us the flexibility to further enhance the customer in-store experience. These investments reflect our intention to be well positioned as the definition of service and experience continues to evolve."

Mike Koppel, Nordstrom's executive vice president and CFO, said "we made a commitment this year to accelerate some of the work we'd be doing in technology, and that would include things like the upgrade of the website," along with "forward progress" on assortment and allocation planning tools.

"In terms of marketing, mostly the additional spend has been in the online marketing world, just so we continue to reach out to more customers on the Internet and build our customer base through that vehicle," Koppel added.

The retailer had a strong third quarter, with total retail sales of $2.1 billion, up 11.7% compared to the same period last year, and same-store sales increases of 5.8%.