07/13/2012 06:45 pm ET

Nordstrom Gains Cool From Cheaper Topshop Brand

Analise Roland, 21, said her very first words as a baby at the counter of a Nordstrom store in California. "I remember growing up at Nordstrom," she said. "Since I was born, my mom and my aunt used to meet at their tea room with me once a week."

Roland, now a senior at Brown University, still loves the store, where she finds clothes a bit more classic than those of most of her friends. Nordstrom, the upscale Seattle-based chain known for impeccable customer service, caters to families like Roland's who are looking for quality in everything from diaper bags to pumps to pillow cases.

Nordstrom on Thursday announced a plan to trendify its mix with a line of clothes from Topshop, the U.K.-based chain whose three U.S. stores blast out sequined hot shorts and Rihanna techno remixes. Topshop's Soho outpost in New York, open since 2009, seems much further away than 20 miles from the nearest Nordstrom in New Jersey, a dignified two-story anchor in the Short Hills mall filled with muted silk and attentive lipstick saleswomen.

While Nordstrom is doing better than many of its competitors -- sales at stores open at least a year were up 8.1 percent in June -- like other department stores, it has yet to fully capture the next generation of luxury shoppers. Unlike their moms, fashionable 20-somethings turn to blogs (not salespeople) for shopping tips and are fickle in their choices, mixing H&M with vintage and designer. As flash sale sites and fast fashion outlets peddle cheaper versions of designer collections, a tasteful selection is no longer enough to win over those with a bit of money to spend.

"Nordstrom is sort of like an old people store in my mind," said Ariana Paoletti, 27, who runs e-commerce and social media for New York City's Amarcord Vintage. In Boston, where she used to live, "it was on the fanciest end of the most upper-crusty mall."

Nordstrom leaders said they believe Topshop will help attract people like Paoletti. "Topshop does a terrific job with trend-led fashion," said Brooke White, a Nordstrom spokeswoman. "We hope that people who haven't shopped with us will give us a try and people who have come in and passed will come back because we'll have a different point of view than in the past."

The collection debuts in 14 of Nordstrom's 117 stores on Sept. 10. It will include pieces from Topshop as well as Topman, the men's brand also owned by British parent Arcadia Group.

Topshop, long a destination for Americans visiting London, drew hours-long lines to its first U.S. store in New York when it opened in April 2009. With dozens of new items coming in every week, Topshop resembles fast-fashion competitors Zara and H&M, though its prices are slightly higher. Collaborations with edgy designers like Mary Katrantzou and Christopher Kane have helped the company gain credibility. The store rarely discounts.

Neiman Marcus is also trying to harness the power of a cool and affordable brand: Target. On Tuesday, the Dallas-based department store chain and Target announced that they will both sell the same holiday collection of pieces from 24 designers, including Rodarte, Marc Jacobs and Altuzarra. Most pieces will cost less than $60. It's a different approach than Neiman Marcus' classic "fantasy gift" holiday catalog, which last year featured a $75,000 yurt.

Today's luxury shopper is less loyal than before, according to Richard Jaffe, an analyst at Stifel Nicolaus. "A Neiman Marcus customer is going to buy a Diane von Furstenberg dress and a $9 teapot," he said. "And a lot of modest income people are buying expensive Coach purses. The world is really blurred."

As foreign brands like Zara and H&M bring new trends at ever faster paces to U.S. malls, department store stalwarts are having to innovate. "Nordstrom doesn't serve the young, savvy customer well at all," said Jaffe. "It's a store that sells all things to all people. That precludes them from taking risks or having [Topshop's] level of imagination."

A Topshop collection will help Nordstrom seduce the next generation of high earners while they're still young, said Jaffe. "Maybe you're a Topshop fan and five years from now you [go to Nordstrom] to buy your wedding dress."

Nordstrom's 110 Rack stores, which sell discounted designer clothing, are also helping to attract younger customers, executives said in May on a conference call with analysts. Nordstrom also has been investing in online shopping. In 2011, it acquired the flash-sale site HauteLook, began offering free shipping on all online purchases and launched a mobile shopping app for its website.

Some shoppers still prefer the calm of department stores to the night club experience of Topshop or H&M. "My other friends really love [Topshop], but I guess I was just raised differently," said Roland. "To go into a store with blaring music where I have to wait in line for 20 minutes to try anything on stresses me out."

"I'd rather pay more to have someone calmly help me find an outfit that has great material, great fit and will last, as opposed to basically scouring tons and tons of racks," she said.