Smart Buying

Retailers Get Creative to Compete With Amazon

Competition from online merchants forces stores to cut prices and expand offerings.

Apple and Best Buy have long used airport vending machines to sell headphones, chargers and gadgets. Now you can also buy items from Benefit makeup, CVS Pharmacy and Japanese clothier Uniqlo at company-branded vending machines in airports, public transit stations and other high-traffic areas. Other brick-and-mortar retailers are turning to new tactics to reach customers, too. Nordstrom recently opened a new store that doesn’t sell merchandise. Shoppers who visit the new West Hollywood, Calif., location, which has a 3,000-square-foot footprint (compared with 140,000 square feet for the typical Nordstrom store), can meet with a personal stylist, pick up online orders or make returns. The store features manicurists and tailoring services, and you can even stop at the bar for a beer or a glass of wine or, if you prefer, a non-alcoholic beverage.

Other retailers are fending off competition the old-fashioned way—by cutting prices. After Amazon bought Whole Foods in August, it signaled that it would play hardball by lowering prices on some items, including organic avocados and organic large brown eggs. Within days, Target announced that it would reduce prices on thousands of household staples ranging from cereal to paper towels.

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