Nordstrom to trim 120 tech jobs as part of restructuring

Dive Brief:

Nordstrom confirmed Friday that the retailer cut 120 jobs in its IT operations last week, GeekWire reports. The retailer said that the cuts were part of a restructuring of its tech team, which has been ongoing for the past seven months.
Although top positions weren’t part of the cuts, GeekWire notes that executives have left the department store’s tech team in recent weeks, including VP of technology Bill Tucker, VP of enterprise architecture and system development & support John Mayfield, and EVP of selling technology Sam Hogenson.
The 120 job cuts are in addition to 10 job cuts reported by GeekWire earlier this month.

Dive Insight:

Nordstrom has made its technology revamp no secret, or of its need to cut costs in the face of disappointing results in recent quarters. The retailer recently reported revenues and earnings that missed expectations during the all-important holiday season.

Nordstrom has fared better when compared to others in the department store space, but continues to face headwinds in apparel sales and falling traffic. It has seen success in its e-commerce units though, including flash-sales site HauteLook and Trunk Club, which it recently opened up to women as well as men.

Retail futurist Doug Stephens, who remains confident in what he calls Nordstrom’s fundamentals, including its reputation for excellent customer service, has told Retail Dive that it would be a mistake for the retailer to achieve cost cutting by cutting store associates. It appears from these reports that the company is opting to trim its tech team instead.

That probably makes sense, considering that e-commerce continues to be a small slice of retail, despite two decades of transformation largely led by growing web sales.

Nordstrom is maintaining its $300 million spending level on its e-commerce, but perhaps that is the outer limit of what it’s willing to do considering that its brick-and-mortar stores are integral to its omnichannel success. Despite its tech cuts, Stephens says that Nordstrom is likely keeping a close eye on what it needs to survive.

“I think that Nordstrom has a very good sense of self,” Stephens told Retail Dive. “They understand who they are and what makes them strong, but at the same time they don’t rest on those laurels. And they are a company that is in touch with technology. They aren’t afraid to try new things and experiment.”