Here's a true story to prove the power of unconditional guarantees: About a dozen years ago, a guy walked into the former Fairbanks, Alaska, Nordstrom department store with two snow tires. He walked up to the tire counter, put the tires down, and asked for his money back. The clerk, who'd been working there for two weeks, saw the price on the side of the tires, reached into the cash register, and handed the man $145.
The customer wanted to return a tire. Never mind that the Nordstrom department-store chain sells upscale clothing, not automotive parts. According to company lore, the clerk accepted the tire because that's what the customer wanted.
Origins: This is possibly the greatest consumer relations story of modern times — it's certainly pointed to as such in a multitude of business articles. In this one simple vignette is captured the essence of what it takes to build and maintain a loyal client base: The customer is always right
Nordstrom began in Seattle in 1901 as a shoe store and grew into largest independent shoe chain in the United States. It was not until 1963 that Nordstrom expanded into the clothing market to become the renowned nationwide fashion specialty chain it is today.
Nordstrom has become synonymous with customer service in a way no other chain of stores has, with the "tire refund" legend doing its part to bolster that image. Nordstrom customers receive 'thank you' cards for shopping there. Unusual requests are handled with aplomb by a knowledgeable sales staff. Staffers have been known to hand-deliver special orders to customers' homes or even to obtain specialty merchandise from other stores for customers who ask for those items. Those looking to return merchandise are not challenged to produce sales slips or Nordstrom price tags for items which are clearly Nordstrom stock.
Which brings us back to our "returned tire" legend — did it happen? The chain's liberal return policy exists to assist Nordstrom customers who have purchased merchandise that has proved unsuitable for their needs; it's not there to provide a dumping ground for whatever items shoppers might have purchased elsewhere. Under this policy, items that could have been bought at Nordstrom are accepted without question, but requests for refunds for items that could not have come from this retailer are turned down.
Nordstrom has never sold tires: It vends clothing and shoes, items highly unlikely to be mistaken for automotive goods. Yet, according to a 1995 book about the company, the tire story is true:
This claim of someone having actually witnessed the incident is apparently only a recent phenomenon. The Nordstrom "tire refund" tale has been recounted in numerous pieces about the company, many from the mid-1980s, yet these far earlier sightings fail to make mention of the additional details now claimed, that this happened in 1975, in a newly-opened store that had previously housed a tire shop, and with a member of the Nordstrom family present.
Also, even in those sightings from mid-1980 and onwards, the details of the incident vary wildly:
- The item(s) being returned is said to be (in various versions) a tire, a used tire, a set of tires, a set of snow tires, a set of radial tires, two snow tires, four tires, or a pair of tires.
- The tires are usually returned to an unidentified Nordstrom outlet, but they're sometimes reportedly returned to a Nordstrom in Alaska or Fairbanks, Alaska (because they're snow tires), or a Nordstrom in Seattle (because that's where Nordstrom is based).
- Sometimes the customer makes no statement as to why he is returning the tires to Nordstrom, but sometimes he claims they were bought at Nordstrom (even though they don't sell tires), or bought in the same building (but not at Nordstrom itself). The customer offers no reason for wanting a refund, except for one version in which he states that the tire "had not stood up properly".
- Prior to the account recently proffered by John Nordstrom, no specific (or even general) date is given for this incident; the most precise date offered is "a dozen years ago."
- The amount of the refund is usually unmentioned. However, one Nordstrom apparently gave a refund of $145 total for two snow tires, while another one paid out $125 each for four tires. In John Nordstrom's account, it's down to $25.
- The mechanism for determining the refund value of the tires is usually not described (the implication being that the customer's word is accepted, no questions asked). But at least one clerk "saw the price on the side of the tires," and another asked the customer "What did you pay for them?"
- Giving a refund for an item clearly not purchased at Nordstrom is all in a day's work for their model employees, something to be expected. One lucky clerk, though, was "praised by management," while another was appointed an "Employee of the Year" (as were all his supervisors).
It's 1975, and you live in Alaska. You're unhappy with one of the tires you recently purchased, so you head back to the tire store you bought it from. Do you fail to notice that this space is now occupied by a seller of high-class men's, women's, and children's clothing and shoes? Do you continue to mistake this clothing shop for a tire store, and instead stand there insisting that they make things right by refunding your money?
Common sense says even the most brain-dead of customers is going to notice at least some slight differences between a tire emporium and an upscale clothier's, not the least of which is the smell. (Tire shops have a peculiar scent all their own.) Common sense also says few (if any) clerks faced with such a request wouldn't dazedly respond, "Well, there used to be a tire shop here, but we just bought the building from them."
Could such a customer have genuinely mistaken a Nordstrom for a tire shop? We don't think so. Could a customer intent upon testing Nordstrom's famed return policy have come in rolling a tire in front of him, playing at being confused for the sake of a bar story? It certainly lies within the realm of possibility, but the much stronger possibility is that the incident was as Nordstrom described it in 1988: apocryphal.
Interestingly, Nordstrom is not the only firm to lay claim to the legend, as this passage from Built From Scratch, a history of Home Depot, shows. The speaker is Bernie Marcus:
One day, a man came into one of our Atlanta stores with a set of automobile tires, demanding a refund. The Home Depot doesn't sell tires - never did, even when we sold some other automotive supplies - so the person running the service desk called Mercer for help.
"Sir," Mercer said, "if you bought them here, what did you pay for them?"
The man named a figure. Mercer reached into the cash register and handed the man the exact amount without another word.
Then Mercer hung the tires over the service desk to remind everybody: "The customer is always right."3
Sightings: In an episode of the television sitcom Cybill ("The Big, Flouncy Thing," original air date
Last updated: 25 April 2011
Abramson, Pamela.   "Nordstrom's High Style."     Newsweek.   5 January 1987   (p. 43).     Diamond, S.J.   "Not All Stores Will Cheerfully Give Refunds."     Los Angeles Times.   15 December 1986   (p. D1).     Gonzalez, Christine.   "Nordstrom Has a New Attitude."     [Minneapolis] Star Tribune.   3 September 1998   (p. D1).     Hamilton, Joan & Amy Dunkin.   "Why Rivals Are Quaking As Nordstrom Heads East."     Business Week.   15 July 1987   (p. 99).     2. Kossen, Bill.   "Success Came a Step at a Time for Nordstrom."     Seattle Times.   29 May 2001   (p. A1).     Levinson, Jay.   "Guerrilla Selling."     Home Office Computing.   April 1994   (p. 47).     3. Marcus, Bernie, and Arthur Blank.   Built From Scratch.     New York: Times Business, 1999   (p. 144).     Pomice, Eva and Alice Cuneo.   "Spoiling for Success."     U.S. News & World Report.   5 December 1988   (p. 52).     1. Spector, Robert and Patrick McCarthy.   The Nordstrom Way.     New York: Wiley, 1995.   ISBN 0-471-16160-8   (p. 26).     Stevenson, Richard.   "Watch Out Macy's, Here Comes Nordstrom."     The New York Times.   27 August 1989   (p. F34).     Sun, Lena.   "Many Happy Returns."     The Washington Post.   26 December 1988   (p. F10).