Did Nordstrom Go Too Far in Customer Service?

Image

Nordstrom is known as one of the best department stores because of their customer service, but have they taken their service too far by implementing a Wi-Fi tracking device in their store? This device, also known as Euclid, tracks the customer’s individual movements through the store by connecting to the Wi-Fi on their cell phone. The program allows stores to track their customer’s movements and see where they go in the store and how long they spend time there.

The information that Euclid provides companies with goes beyond tracking where customers went in the store and uses that data to help make their shopping experience better. By finding out where customers went in the store, how long they were in each area, and if they purchased something or not can show Nordstrom where most customers focus their attention to and map out how they can make the customer’s shopping experience a better one.

 Image

For managers the data provides overall information about the times the store has the most traffic, which allows them to staff the floor accordingly and make sure that there are not too few or too many employees working. It also shows the foot-traffic that the store gets at their windows and shows how many people enter the store and how many keep walking. But for all the data that Nordstrom collects is it actually benefiting them?

When implementing the Euclid into their stores in 2013 Nordstrom posted signs to warn customers about the activities that are going on. Once customers realized what was going on their sense of security when shopping seemed to lower. Many consumers felt that this was an invasion of their privacy by tracking what they were doing without their consent. Although Euclid is anonymous, consumers still had their worries about what was actually being collected and how it was used. Consumers did not think that tracking their movements in the store would be so beneficial to the company that it would be worth making their customers feel uncomfortable. Even for potential customers who were thinking about going into Nordstrom they might have decided to not go in because they knew about the Euclid.

Image 

It is hard to blame the consumer for feeling uneasy about being tracked because they do not truly know what information is being taken of them and where it is going. This device provides a reason for shoppers to not want to go in the store and makes consumers decide if they trust Nordstrom enough to shop there. This requires a decision process that would not have to be made if the Euclid was never put in the store and allows for another attribute to be compared between Nordstrom and other department stores.

After 8 months of having Euclid in their store, Nordstrom decided to take the devices down and use the data they collected to help improve their service. It was only after the story about their store using Euclid went on national news that Nordstrom took them down. Once their story went national Nordstroms received a lot of negative feedback from consumers and decided that the best way to respond was to take them down. Nordstrom stated that the use of Euclid was purely for testing and it was never going to be permanently implemented into their store. The store stuck by their decision in using Euclid and said it was just one of many ways in which they try to find new ways of seeking out customer information.

I find the use of Euclid to have been unethical and an invasion of their consumer’s privacy. Although there were signs put up there was no actual consent process done to allow them to track their customers. Yes their customers were aware of what was going on if they walked into the store, but were they aware that they were being tracked right outside the store? If Nordstrom had communicated the implementation of the device in a different way and either asked for consumers to participate or put their marketing efforts into sending out the message that they were trying to perfect their service than people may have been more receptive to the idea. But because they quietly placed the devices in certain stores and only put up signs to notify the consumers it came across as a secret mission that was to collect important data from people’s phones.  The consumers reacted the way they did because they felt that Nordstrom was keeping something from them about what they were doing, which is the way it seemed by how they put the Euclid into the stores. If Nordstrom wants to improve their customer service they should include their customers in on the process and make sure whatever method they use is considered appropriate to their customers.

 

 

http://www.forbes.com/sites/petercohan/2013/05/09/how-nordstrom-and-home-depot-use-wifi-to-spy-on-shoppers/

 http://www.retailsolutionsonline.com/doc/nordstrom-experiment-highlights-privacy-issue-0001

LinkedIn Freemium

LinkedIn came out in 2003 as a different type of social media site that now contains millions of business professionals who can connect with one another. Unlike Facebook, Twitter, and Instagram; LinkedIn is a social networking site that is strictly used for job related purposes. Users of LinkedIn are more careful and diligent about what they put on their profile than any other social media site because it is based strictly on business. The profile you build of yourself on LinkedIn is not about what music or movies you like but it is about the experience you have had in your life and your goals for the future. No other social media site allows you to display your resume and skills in a simple webpage so that you can seem appealing to possible employers.  This website has created a new way of networking and gives you the platform for starting a conversation. You no longer have to wait for certain events or networking nights to occur to be able to have a chance to talk to certain people. Now you can go on one simple site and look up people either by name, industry, school, or company and send them a message right there. You are able to join groups and organizations that you are apart of and see others who are also involved. LinkedIn has made their website free for all their users and has available options for them to upgrade to different versions.  

 Image

LinkedIn uses the freemium strategy where their initial product is free but there are options for an upgrade if someone wants a more intense version. LinkedIn has focused their company mission on the job-seeking user and has created their premium upgrades around them. LinkedIn members are allowed to upgrade their account by purchasing “LinkedIn Job Seeker Premium” or “LinkedIn Premium Subscriber”. “LinkedIn Job Seeker Premium” is an amazing tool that after reading about it made me want to subscribe. In the first sentence of the Job Seeker Premium explanation they state that it “gives you the tools to land your dream job faster.” The tools that they provide you consist of seeing everyone who has viewed your profile (non-members only see a select group), the ability to send personalized InMails to recruiters, views of salary estimates for job postings, comparison of yourself to other applicants, and the opportunity to have your application be at the top of the list as a “Featured Applicant”. These amenities give those who purchase the upgrade a chance to be ahead of their competition and have more resources to help them get a job. With different annual and monthly costs, LinkedIn has set the prices so that to subscribe for an annual package it would be cheaper than the monthly. This pushes their users to subscribe for a year so that they can get them to be apart of this package for longer and encourage continuous use.

 

Other options that LinkedIn offers to upgrade are geared toward companies and business owners to help find new employees and utilized this social media website for all that it can offer. The options for companies on LinkedIn to upgrade are “LinkedIn Talent Solution,” “LinkedIn Marketing Solutions,” and “LinkedIn Sales Solutions.” The names in themselves describe the type of help that they are willing to give companies. These upgrades allow you to have some of the same access tools that the Premium Subscriber and Job Seeker Premium get you but also come with more direct information about how to compete with other businesses that are on this website and how to utilize all the options it has to offer. In each upgrade you learn specific tips on certain focuses like on finding great talent, contributing good marketing, and making LinkedIn part of your sales business. Each is there to help businesses grow through this network connection in a simple and easy to use manner. With these upgrades businesses are able to get a lot of tools and information about succeeding on LinkedIn and provides them with a good platform to expand their company.

 

The freemium strategy that LinkedIn uses has paid off for them because their business has grown dramatically since it began and is now a $1 billion company. When looking at the company website however it did not show that many people used their updates due to their lack of likes. With over a billion people on LinkedIn their likes for “LinkedIn Job Seeker Premium” and “LinkedIn Premium Subscription” has not reached over 1,000 likes. This is surprising because you would assume that out of all of the billion users more than a thousand would like it. It may be however that people who bought the product did not like the update on the page because they either liked it but didn’t want to like it on the page or actually didn’t like it. It does seem to be the case that people just ignore liking it on the page due to their consistent profit increases over the years but it still is not a big part of their revenue. Most of the money that the company seems to make is from talent solutions that they have for companies. Businesses have utilized the opportunity to learn more about expanding their business online and it seems to be a growing trend for companies to use.

 

LinkedIn will continue to grow and become a beneficial resource like it already has for people all over the world. Being the only social media website of its kind LinkedIn is a reliable tool that business professionals know they can use to connect with others because of selective type of program it is. Not only can you create your own identity on there but you can create a company brand. The usage for both people and businesses allows LinkedIn to be useful to all professionals and keep finding ways to connect them.

 

Resources: http://investors.linkedin.com/releasedetail.cfm?ReleaseID=738977

http://money.cnn.com/2009/06/02/smallbusiness/linkedin_startup_story.smb/

http://www.linkedin.com/company/linkedin/products?trk=top_nav_products