For years, retailers’ prevailing attitude toward resale and rental platforms was one of non-acknowledgement or distrust. But increasingly, that’s evolved to “If you can’t beat them, join them.”

Nordstrom is the latest big department store to get into the resale game. On Friday, it opened a resale shop called See You Tomorrow in its Manhattan flagship store. The shop will be open for at least six months, with the potential to stick around for longer. For Nordstrom’s vp of creative projects, Olivia Kim, this is just the beginning of Nordstrom’s long-term resale plans, however they wind up. 

“Recommerce is going to stick around for us in some format or another,” Kim said. “One of the purposes of this shop is to figure out what it will look like and how to scale it. Will it be in 10 doors or 100? What will the buyback program look like? Will it be the same in-store and online? Those are all things we still need to figure out, but I believe resale is here to stay and it can coexist with all our different channels.”

As brick-and-mortar department stores face stiff competition from online players and DTC brands, as well as deal with high real estate costs, they need to find new ways to service customers that meet them where they are and adjust to how they’re actually shopping. While resale may have once been seen as the enemy, it’s increasingly something that retailers are embracing to stay relevant. The challenge then becomes competing with platforms that solely focus on resale.

Nordstrom’s pitch for how it can compete with dedicated resale platforms is that it has a direct relationship with brands that many platforms do not have, largely due to the fact that brands are skeptical of what the platforms can offer them. All the brands available at Nordstrom’s shop, including Comme des Garçons, Thom Browne and Burberry, expressed interest to Kim in exploring the resale world and saw Nordstrom as a safe way to do it. All included products are sourced from returns to Nordstrom, so the authenticity is guaranteed.

In the future, Nordstrom will also institute a buy-back program where customers can return items to Nordstrom (both online and at the NYC flagship location) in exchange for gift cards that can be used at Nordstrom or any related store like Nordstrom Rack.

Normally, returned items would be sold at Nordstrom Rack at a steep discount, but if Nordstrom has a more robust resale presence, those items can be repurposed and sold in the main Nordstrom store, likely at a higher price. Kim said that pricing of the items in the shop is in flux, but that Nordstrom is working on ways to make pricing resold items dynamic and reflective of the market price and the brand’s desirability.

As Kim sees it, Nordstrom’s customers are resale customers already, and there’s great value in giving customers the option to shop resale at Nordstrom. 

More than half of all Americans are already engaged in recommerce in one way or another,” Kim said. “It’s happening. The nice thing for the brands about doing it with us is that we can talk to them really openly and honestly about pricing, authenticity, positioning. We can talk about what products they’re OK with being resold and which ones they don’t want. Being in control of the story being told around it, that was my pitch to the brands who agreed to work with us.”

In addition to bringing in new customers, doing resale in-house provides a learning opportunity for Nordstrom to get the kind of deep data on customers that can be applied in areas outside of resale. 

“One thing I’m curious in seeing is how people will use our different channels together,” Kim said. “Do they use our retail channel to evaluate a product before seeking it out on resale? There’s a lot of data suggesting that the person who buys at full price and sells to resale is not the same customer who buys pre-owned. People who sell older stuff will use that money to buy a full-price luxury item, while the people who buy resale are younger and they’re making their first luxury purchase. It’s two different customers, and if we can serve both, aren’t we theoretically doubling the number of customers we reach?”

Outside of Nordstrom, other retailers are waking up to the fact that offering in-house takes on alternative business models is essential since those models aren’t going to go away. Mary Alderete, CMO of Banana Republic, said this was part of the impetus behind the brand launching its own in-house rental service, Style Passport, last fall. Like Nordstrom, she said that program is just the beginning of a long-term exploration of how to bring those ideas in-house.

“As head of marketing, I have to get new customers to come into the brand with a compelling reason and a good offer,” Alderete said. “And we need to acknowledge that things are changing. People already rent and buy resale, so we might as well offer it ourselves. I think it would be great if one day we could have retail, rental and resale all on our same website.”