The Color of Money at Nordstrom is Not Red or Blue, It’s Green.
Cincinnati, wedged between Kentucky and Indiana at the southwestern tip of the state, is where swinging Ohio blushes deep Red. Except for a few pockets of anomalous defiance that cling Blue, one of which boasts a Nordstrom store. Nordstrom, like a growing number of brands, finds itself caught in the drama of a political America at war with itself. The upscale retailer, facing boycotts from Left and Right, has been forced to pick one. And while it may appear that Nordstrom has picked Blue over Red, it’s actually picked Green above all else.
Some brands choose to affirm fealty to a cause, and while this choice may not be overtly political, it defines the brand along the political spectrum. Hobby Lobby's owners are unabashed about Christian principles in its mission statement. Domino's Pizza, until its sale to Bain Capital, was heavily influenced by its founder’s Catholic activism. But most brands tend not to have such a foundational imperative. Many find a purpose because experts have told them it will strengthen their brand equity. Taking a stand may appear to be a shallow calculated decision, bereft of heart, but it does deliver on the one ethical responsibility that management has – its fiduciary responsibility to its principals, the shareholders.
The fiduciary responsibility of management requires an apolitical pursuit of shareholder value. The CMO advances this agenda by having a clear understanding of the brand's best customers, delighting these customers to increase their value contribution, and bringing in new customers that look just like the very profitable ones. A CMO, as an agent of the shareholders, should not have to pick sides. She needs to pick good customers and keep them loyal. In the schism that has leached from American politics to American brands, the Red-Blue divide is not brand driven, but is a fall-out of customer profiles. Ohio has 3 Nordstrom stores. California, which has about 3.3 times the population of Ohio, has more than 10 times the number of Nordstrom stores. Blue States have many more Whole Foods relative to their population, Red states many more Walmarts. Brands have not picked sides; they've merely picked customers in what the New York Times calls the "The Two Americas of 2016."
The income divide may seem like the easy go-to, especially for an upscale retailer like Nordstrom, but Red and Blue were in dead heat for voters with annual income over $100,000. The divide is much more complex, stemming from an amalgam of income, education, and attitudes, among others. CMOs forced to pick need to have richer personas for their most profitable customers, moving well beyond simplistic demographic markers. But then again, every good CMO needs to know her best customers at that fine level of detail. And if she doesn’t, this is about a good time as any to get started.
This may all sound extremely cold and callous – brands, guided by big data algorithms, in metronomic march to the drumbeat of their Wall Street masters. But let’s not set our sight on the wrong target. Brands do not bring change, we do. We exercise our opinions, no matter what they may be, with our wallets many times a day, and the sound of our money will be heard loud and clear. This is our right, so go out and do it; your democracy will thank you for it. Vote with your wallet. And then let the brands follow the money.