Robert E. Campbell - Vice President of Investor Relations and Treasurer Blake W. Nordstrom - Principal Executive Officer, President and Director Michael G. Koppel - Chief Financial Officer and Executive Vice President Peter E. Nordstrom - Executive Vice President, President of Merchandising and Director James F. Nordstrom - Executive Vice President and President of Nordstrom Direct Erik B. Nordstrom - Executive Vice President, President of Stores and Director

Jessica Schmidt - KeyBanc Capital Markets Inc., Research Division Kimberly C. Greenberger - Morgan Stanley, Research Division Jennifer Black Barbara Wyckoff - CLSA Limited, Research Division Charles X. Grom - Sterne Agee & Leach Inc., Research Division Neely J.N. Tamminga - Piper Jaffray Companies, Research Division Stephen W. Grambling - Goldman Sachs Group Inc., Research Division Oliver Chen - Citigroup Inc, Research Division Paul Trussell - Deutsche Bank AG, Research Division Paul Lejuez - Wells Fargo Securities, LLC, Research Division Robert Scott Drbul - Nomura Securities Co. Ltd., Research Division Michael Binetti - UBS Investment Bank, Research Division

Hello, and welcome to the Nordstrom 2013 Fourth Quarter Conference Call. At the request of Nordstrom, today's conference call is being recorded. [Operator Instructions] I would now like to introduce Rob Campbell, Treasurer and Vice President of Investor Relations for Nordstrom. You may begin, sir. Robert E. Campbell: Hello, everyone, and thank you for joining us. Today's earnings call will last 45 minutes and will include about 30 minutes for your questions. As a reminder, all forward-looking statements on this call are subject to risks and uncertainties that could cause the company's actual results to differ materially from the expectations and assumptions discussed due to a variety of factors that affect the company, including the risks specified in the company's most recently filed Forms 10-K and 10-Q. Participating in today's call are Blake Nordstrom, President of Nordstrom, Inc.; and Mike Koppel, Executive Vice President and Chief Financial Officer, who will discuss the company's fourth quarter and full year performance and outlook for fiscal 2014. Joining during the Q&A session will be Pete Nordstrom, President of Merchandising; Erik Nordstrom, President of Stores; and Jamie Nordstrom, President of Direct. Before we begin, I want to mention that Blake and Mike will be using slides, which can be viewed by going to nordstrom.com in the Investor Relations tab. With that, I'll turn the call over to Blake. Blake W. Nordstrom: Thank you, Rob, and good afternoon, everyone. As we take a moment to reflect on 2013, it was a year in which customers clearly demonstrated their increasing desire for speed and convenience, whether online or in stores. It also was a year in which the impact of e-commerce became more apparent in terms of customers' broader acceptance and usage to research, to transact and to facilitate purchases across channels. If anything, the pace of change is accelerating faster than we anticipated a year ago. For example, with estimates of nearly 200 million mobile devices in the U.S. today, they rapidly have become an integral part of consumers' everyday lives. It strongly validates the strategic path we embarked on nearly a decade ago in laying the foundation by making investments to provide a differentiated customer experience in a multichannel environment. We believe there is tremendous value in having a platform for serving customers that encompasses full price and off-price, in-store and online. Each of these channels represents substantial opportunity individually. There also is significant potential in the way they can work together in creating a unique customer experience, with enablers such as product, loyalty, technology and personalization that we are utilizing across channels. We made substantial progress in many ways during the year. Our Direct business finished its third consecutive year of at least 30% top line growth. A key driver was increased merchandise selection, which grew 30% this year, after expanding by 50% a year ago. 1 million new customers were acquired via our online business, similar to 2012. We saw mobile and tablet usage continue to grow. We offered more recommendations based on purchase history, and we increased the speed of fulfillment and delivery. As our online business expands, we're increasing our capacity to enable a greater service experience. Last fall, we doubled our daily fulfillment capacity to 300,000 units. More recently, we opened a fulfillment center in San Bernardino to serve HauteLook and the Rack. And last month, we announced plans for a fulfillment center on the East Coast. By 2015, we'll have 3x the capacity we had in 2012. In the Rack, we're serving more customers in existing stores and in the 22 stores that opened during the year, which contributed to a 12% increase in total sales. Collectively, our new store performance is in line with our expectations, and our total Rack sales productivity remains strong at $550 per square foot. Our integration with HauteLook has increased, an example of which is the ability to return HauteLook merchandise to any of our Rack locations. Today, a good portion of HauteLook returns come to a Rack store. This drives thousands of customers to the Rack each week. And of those making a return, many leave with a Rack purchase. In addition, as of a few months ago, the Rack can fulfill the demand in one store through the inventory in another and deliver it to the customer. This feature mirrors the service we've offered in our full-line stores for a number of years. Our full-line store sales fell short of expectations, but we have ongoing initiatives around product, service and the store environment to elevate the customer experience. Our plan to enhance our relevance with existing and new customers in part was demonstrated in our Women's Apparel business, which continued to experience positive momentum during the year. We expanded Topshop to 41 stores from 14 at the start of the year and repositioned our Savvy department to offer on-trend fashion at more accessible price points. Both have attracted new and younger customers, while reflecting newness in fashion that have a halo effect across the entire offering. Recent remodels have created energy through a more clean and updated look. They've established more flexible floor space that enable us to respond more quickly to emerging trends while allowing for more continuous shopping between departments. The ongoing evolution of retail is exciting, with the accelerated growth of e-commerce, the continuing importance of stores and the increasing customer interaction between channels. As this unfolds, we're taking steps to ensure that our allocation of capital is aligned with our growth. We're also making adjustments to better support our multichannel growth strategy and achieve greater execution. As we turn to 2014, we anticipate considerable progress across multiple fronts: first, enhance the full-line store experience with ongoing efforts around product, service and store environment; open 3 full-line stores including Calgary, our first store in Canada, which will open in September, along with Jacksonville and a second store in Houston; offer even greater selection online with an increased level of personalization; open 27 Rack stores and continue to find opportunities for further integration with HauteLook; finally, apply greater focus on building synergies in our multichannel platform through leveraging our shared assets such as loyalty, technology and marketing. We strongly believe in the customer strategy we're in the midst of executing. We're focused squarely on improving the customer experience and the sustainable platform for long-term profitable growth that it's enabling. We're encouraged by the progress we've achieved to date and the multiple opportunities ahead of us. We look forward to keeping you updated as we go throughout the year. With that, I'll turn it over to Mike. Michael G. Koppel: Thanks, Blake. Before commenting on our financial performance, I'd like to reinforce comments Blake made around the accelerated pace of change. It's very clear that advancements in technology, and specifically in e-commerce, are redefining the customer experience across all channels. It's happening at a pace that's even faster than we anticipated a year ago. In one sense, it increases our confidence in the strategic path forward and validates our efforts to provide our customers a best-in-class experience, both in-store and online and through our full-price and off-price channels. It also reminds us that speed is important while being flexible enough to make adjustments as we respond to customers' heightened expectations. Turning to our financial performance. Our full year earnings per diluted share of $3.71 exceeded our prior outlook of $3.65 to $3.70 and fell within the range of our initial annual guidance of $3.65 to $3.80 that we provided a year ago. These results included a nonrecurring charge of $14 million or $0.04 in earnings per diluted share related to our recent debt transaction that lowered our overall cost of borrowing and extended maturity. Additionally, we delivered return on invested capital of 13.6%, while increasing our capital investments by over 50% this year. We achieved a milestone with over $12 billion in sales, representing an increase of 4.9% over last year when adjusting for the 53rd week in 2012. Same-store sales increased 2.5% for the year, which was consistent with our prior outlook but below our annual plan. The impact of softer top line trends was mitigated by consistent execution throughout the year in inventory and expenses. As we exit the year, our inventory is at an appropriate level, reflecting planned investments to fuel growth in stores and online. Next, I'd like to talk about our path forward. We believe strongly in the customer strategy we're currently implementing and its ability to generate long-term, top-quartile shareholder returns. We've stated that as a result of our planned growth, with anticipated double-digit increases in depreciation and rent in the near term, we don't expect EBIT margin expansion over the next several years. However, EBITDAR, which excludes these components, is expected to grow roughly in line with sales. This provides a clear indication of our underlying performance, and together with total sales growth and ROIC, are markers for continued value creation. In our efforts to serve existing and new customers, we expect roughly half of our sales to come from our online and Rack businesses over the next several years compared to 38% today. As our business model evolves with growing volume across a number of channels, our financial model needs to evolve as well. There are dynamics associated with our growth in each channel that I'd like to touch on briefly. First, we expect our online business to remain our fastest-growing channel, generating high EBIT growth and returns. The outside sales growth demonstrated over the past several years in part reflects benefits from the investments we've been making. We plan to continue elevating the customer experience online and able through investments in our technology platform, fulfillment capabilities and personalization. With the Rack, which achieved high sales productivity, EBIT margins and returns, we plan to grow this business from 140 stores today to roughly 230 stores by 2016. During this time, approximately 40% of the Rack store base will have opened in the past 3 years. In the near term, this accelerated pace of store expansion will result in higher occupancy expenses as a percent of sales in addition to the impact of greater preopening rent expense. With full-line stores, we anticipate moderating sales trends with fewer store openings. In response, we are focusing on opportunities to improve our 4-Wall productivity, as well as making adjustments to our remodel strategy. And finally, with respect to Canada, we are beginning with 6 full-line stores. We believe this market ultimately represents a $1 billion sales opportunity with value-creating returns. Achieving this requires meaningful infrastructural investments. As a result, we expect this business to remain EPS dilutive for several years until we reach necessary scale. While these channels present various operating dynamics, we believe our enterprise assets, such as our loyalty program, marketing and technology, will serve to create a customer experience that leverages all channels. Our financial position remains strong. For 5 consecutive years, we've generated cash flow from operations in excess of $1 billion while maintaining a balance of reinvesting in the business and returning value to shareholders. Part of the financial model evolution includes revising the allocation of capital investments to more closely align with our growth. Our capital plan of $3.9 billion for 2014 through 2018 represents a substantial increase from the $2.2 billion of the previous 5-year period and reflects the aggressive online and store growth we anticipate. Technology investments account for over 30% of our plan, up from roughly 20% historically. Stores continue to represent the core of our brand. We are finding ways to reinvest that allows stores to be refreshed more efficiently by letting the customer experience rather than the age of the store drive the process. With this approach, we believe we can significantly reduce our remodel investment per square foot while enhancing the overall store environment. Finally, I'd like to turn to our 2014 outlook. Our plan for earnings per diluted share of $3.75 to $3.90 incorporates expected total sales growth of 5.5% to 7.5%. We are planning a same-store sales increase of 2% to 4% based on our current trends. This assumes a low- to mid-single-digit increase on a multichannel basis, reflecting consistent trends at full-line stores and roughly a 25% increase at Direct and HauteLook and a low-single-digit increase in the Rack with total sales growth in the mid-teens. Other considerations include the impact of our initial entry into Canada, for which we estimate an EBIT loss of approximately $35 million, primarily representing our infrastructure investments and pre-opening costs. Our 2014 outlook also includes the acceleration of Rack store growth and increased technology investments to improve service and experience across all channels. These investments are contributing to our overall depreciation and rent expense growth of approximately 14% in 2014. Please also refer to the earnings release for timing considerations contemplated in our outlook, including additional color on expected first quarter performance. We look forward to providing updates on our progress throughout the year. With that, I'll turn the call over to Rob. Robert E. Campbell: Thank you, Mike. [Operator Instructions] Elan, we'll take the first question.

Our first question today is from Jessica Schmidt from KeyBanc. Jessica Schmidt - KeyBanc Capital Markets Inc., Research Division: This is Jessica on for Ed. Can you just talk about the changes, if any, that you've made to your at once inventory purchases? Have you decreased your percent of inventory that you purchased through preorders, I guess, leaving more open to buys during the season? And then how should we think about your inventory strategy going forward? Michael G. Koppel: Well, Jessica, this is Mike. In terms of our overall inventory strategy going forward, we continue to look for opportunities to improve the turns in order to assure that we have new receipts and fresh product available to our customers. In addition, we've made some relatively aggressive changes to our plans in the Rack, where we've gone out and purchased inventory at an advantageous way in order to drive business in subsequent seasons. So we expect to continue to look for those opportunities, and in addition, increasing the assortments online. So from an overall strategic point of view, that's what we plan. In terms of your specific question, I'm... Blake W. Nordstrom: Well, Mike, this is Blake. I just would add that from an aging point of view as well, we measured that closely through your team and we have not seen any material change. And that a matter of fact, our inventories are as current and as fresh as they've been in the past, and so we're encouraged by that. Michael G. Koppel: Okay. Blake W. Nordstrom: Yes, does that answer your question? Because I'm not sure I understand maybe what else you were asking. Jessica Schmidt - KeyBanc Capital Markets Inc., Research Division: Yes, I think that, that answers it. I'll pass on.

Our next question is from Kimberly Greenberger from Morgan Stanley. Kimberly C. Greenberger - Morgan Stanley, Research Division: My question is on the channel shift that seems to be happening between the full-line stores and e-commerce. Obviously, the e-commerce growth of 30% last year was really fantastic. Full-line comps down 2.1%. It looks like the net between the 2 is a small increase. But I'm wondering if maybe you can just sort of step back and talk to us about this financial implication of -- on the operating margin of this channel shift. And then I just had one clarification on one of your earlier comments as a follow-up. Michael G. Koppel: Sure, Kim, this is Mike. In terms of the "channel shift," I just want to start by saying we still look at this as a customer strategy and not necessarily a strategy that's focused around individual channels in our business. But that being said, the reality is both channels do operate different. The stores tend to be much more capital intensive, have a higher fixed cost and require certain levels of sales to leverage that fixed cost where the direct channel has a much more variable cost model. And so clearly, on the way up, it does generate more cost. But it also, on the way down, when it softens, it also gives some of that back. So that being said is we believe that we have opportunities to improve the productivity in our 4-Wall model, particularly full-line. We touched on that a little bit in terms of some of the changes we're making in our remodel strategy. And we're also looking at ways that we can improve the productivity within those stores. Kimberly C. Greenberger - Morgan Stanley, Research Division: Okay, that's super helpful. And just a clarification, you mentioned, I think, in your prepared remarks that you don't expect operating margin expansion over the next several years. I'm wondering, is that using 2013 as sort of a baseline year or 2014 as your baseline year? Michael G. Koppel: Well, I would say it's -- we're assuming 2014 because that's the current year that we're talking about.

Our next question is from Jennifer Black from Jennifer Black & Associates.

I wondered if you could quantify the impact of the recent change you made in your Fashion Rewards program as far as alterations. It seems like it could be significant as far as driving traffic across channels. And do you think customers understand the strategy? I mean, I know I understand it. Some people thought they're losing a benefit, but it seems like it could be really beneficial. And then I have a follow-up on Activewear. Michael G. Koppel: Well, yes, Jennifer. This is Mike. I mean, basically, that change was a result of a couple of things. We were looking at the overall economics and the offer to the customer, as well as trying to make it more convenient. But that being said, we have heard back from our customers about that change, and we're evaluating it and trying to best understand what would be the best product and benefits that we can offer. But in terms of significant change in traffic, at this point, we don't see anything driving additional. That being said, last year, we did add another 1 million new accounts to our Nordstrom Rewards program, and we accelerated the penetration to over 38% of our business. So we're still seeing some pretty good growth in that loyalty program.

Well, you have an awesome program. My follow-up is on Activewear, which is one of the fastest growing categories across the board and Zella looks amazing. And I just wondered what you're doing to capitalize on the lifestyle shift that's been occurring over the last couple of years. I saw that you've introduced Zella PRO. Are you going to expand the department and categories? Are you adding line extensions? Are you thinking about Men's? Just anything you could say would be great. Peter E. Nordstrom: Yes, this is Pete. I think we're happy with the momentum and the trajectory we have in Active. And you're right, it's a good classification, and there certainly is an opportunity in Men's as well. And I think you'll see that will increase our inventory ownership in active-type products. We're definitely trying to figure out how to update our -- the environment with the active department so that it definitely has a stand-alone feel and lets customers know that we're serious about being in that business in the year-round way, which is we've done for a long, long time. But I think that we continue just to stay close to it. And like all our departments that we have, we try to give them the opportunity to grow when that opportunity exists in whatever classification. And so yes, I think active is something that we're definitely confident with. And Zella, which you mentioned in particular, one of our MPG brands, has done super well. We plan on growing that further this next year.

Our next question is from Barbara Wyckoff from CLSA. Barbara Wyckoff - CLSA Limited, Research Division: I'm encouraged by the strength in more contemporary Women's Apparel. But could you talk about if anything is going on in more classic clothes? What's going on in Brass Plum? And then also, could you comment on the strength of casual versus more dressed-up looks? Peter E. Nordstrom: Yes, this is Pete. I think related to what would be kind of more of an updated kind of classic-type look, not just pure contemporary, interestingly for us, our studio department had a really, really good year and that is bridged-price-point-type clothes but more leaning towards classic, as you called it, styling. And that did almost nearly as well as the individuals department, which features more of the contemporary brand. So I think a lot of it is about where we have strong national branded representation in our stores. If we can get behind that in a meaningful way, customers are really responding strongly to brands. And that's been the case in both individuals and the studio area. I think just generally across the board with Women's, everything feels like it needs to be evolving and made more modern, even if it's more classic in nature. When we've been able to do that, been good for the business all the way around. I'm sorry, and the rest of the parts of your question? Barbara Wyckoff - CLSA Limited, Research Division: About Brass Plum, what's going on there? Peter E. Nordstrom: Yes, BP, our Women's Junior area, that continued to be difficult. It's an ongoing thing for us. I think there's some environmental things we can improve on and the in-store experience, the customer experience there. We've tried a lot of things. And we definitely have, we think, an improved way of executing. And then in terms of product, the good news is, is that all turns pretty quickly. And we have a really good team there and they feel confident we're going to have some improvement. If you look at just the trajectory of where we've been while the business has been difficult, it is moving in the right direction. So I think we're encouraged that it's going to improve, but it's still, even at this time, on the -- towards the bottom for us. And then lastly, the other one was what? Blake W. Nordstrom: Casual versus dressed up. Peter E. Nordstrom: Casual versus dressed up. Well, I think the customer places a lot of value on versatile clothes and being able to have things work for multiple occasions. So I think things that are dressed up for the sake of being dressed up may be what we would have classified in the past as like wear-to-work clothes. That's -- it's just kind of a different story today, particularly in Women's. I think there's a lot more flexibility. When we can bring things in that have some flexibility for someone's job or lifestyle or whatever they're doing, that's when we seem to do best.

Our next question is from Charles Grom from Sterne Agee. Charles X. Grom - Sterne Agee & Leach Inc., Research Division: Just on the commentary regarding the first quarter sales. Should we expect comps to be up, say, flat to up 2%? And then just on the fourth quarter, I'm just wondering if you could share how the quarter-to-date shook out across channels? Michael G. Koppel: Sure, yes. Chuck, this is Mike. Yes, you're right in your numbers. Q1 looks like it's roughly flat to 2% comp overall, the way we've calendarized that out. And in terms of the holiday period, we definitely had, I would say, better than trend sales in the month of November and in the first half of December. Sales started to soften up around the holiday and it continued soft post-Holiday and through January. Charles X. Grom - Sterne Agee & Leach Inc., Research Division: Okay. And then just on a follow-up, Mike, just gross profit margins down the past couple of years. How should we think about that over the next 2 years? It seemed -- there seem to be some pressure points from promotional activities and certainly from the Rack. Should we expect margins to be down in the next couple of years, gross margins? Michael G. Koppel: Well, we don't normally give outlook beyond the current year we're talking about. But I think it's safe to say when you look at the -- at where the growth in our business is coming from, particularly with the Rack, Rack tends to have a lower merchandise margin and a lower operating expense. And so you're seeing a geographical shift there. And we've also seen a little bit of pressure over the last probably 2 years from the loyalty program, where you see the cost of that program ends up in our -- in cost of goods sold. So those would be probably the 2 most significant ones. In terms of the promotion, while that had some impact, it really hasn't been, I would say, materially measurable compared to those other 2 components.

Our next question is from Neely Tamminga from Piper Jaffray. Neely J.N. Tamminga - Piper Jaffray Companies, Research Division: I was wondering if you guys can enlighten us a little bit more on some of your mobile strategy for 2014. We obviously saw the HauteLook-developed Rack app from this fall but it's not yet commerce enabled. Kind of what are you thinking there? And then can we see some further elevation on your smartphone app to really integrate, I think, better the loyalty with -- for your core customer in the core Nordstrom app? Michael G. Koppel: Jamie, can you take that question, please? James F. Nordstrom: Yes, sure. Neely, this is Jamie. I think we're focused on mobile quite a bit right now. It's definitely increasing the terms of the amount of traffic we're getting as well as in our sales. What's interesting for us is that we've got a lot of customers right now who are only interacting with our brand because they're new to our brand or they're younger through their phone. We've got to make sure that the experience they have with us through their phone is a good one. So we're investing a lot in that. You're going to see some pretty big improvements to our mobile site later this spring we'll be rolling out. And yes, we've been learning a lot through our off-sale -- or sorry, our off-price business in terms of how customers want to use their phones to shop. And so we're putting a lot of those ideas to work, and we're pretty encouraged by a lot of those investments so far.

Our next question is from Stephen Grambling from Goldman Sachs. Stephen W. Grambling - Goldman Sachs Group Inc., Research Division: So just given the accelerated growth in the Rack, can you provide any detail on how these stores mature across sales and profitability on a 4-Wall basis? Michael G. Koppel: They tend to reach the maturity curve somewhere in the 3- to 4-year range. Stephen W. Grambling - Goldman Sachs Group Inc., Research Division: And so that will be both sales and profitability? Michael G. Koppel: No, I would say profitability over time tends to leverage as you start to work through the upfront costs of the store buildout and some of those other fixed costs. Stephen W. Grambling - Goldman Sachs Group Inc., Research Division: Okay. And then as a follow-up, just as we think about CapEx longer term, you did mention that e-commerce should ultimately be a lower capital cost. And it looks like you'll be spending -- you'll be over the spending hump as it relates to the prior 5-year outlook. So how should we be thinking about CapEx beyond this year? Michael G. Koppel: Well, in terms of the 5-year cadence, clearly, the next couple of years will be the peak years. And what's driving the -- a big portion of that really is the investment in Canada with the rollout of the 6 stores in Canada and then some of the buildup in Manhattan. Technology also for the, I would say, the first roughly 2 to 3 years of the plan is, from what we can see today, is at its peak level. But I think we have to be cautious in that things are changing. There's a lot of newness that keeps coming out. And our line of sight in that world is really only roughly a 2- to 3-year period. And so to say that we're going to reach a peak and then it's going to stop, I think, would be misleading on our part.

Our next question is from Oliver Chen from Citigroup. Oliver Chen - Citigroup Inc, Research Division: Regarding your callout on the promotional environment that we've seen in the marketplace, has that dynamic let up as you look forward? And also, the promotional markdowns in terms of increased markdowns, is that across different banners that you had? Or where was that focused? The follow-up for me is on the full-line comps and the trends there. Does your guidance incorporate a continuation of what you're seeing now? Peter E. Nordstrom: This is Pete. I think it's fair to say that the increased promotional activity that happened in December was more than we had expected and an area of concern for us going forward. And there are some things that we can do to mitigate that, given our ability to have relative exclusives with the brands that we operate with, our own branded product, which is a growing part of our business. But it's a world that we live in. And with the way that Direct works now and all the information available to customers, if something is online and it's marked down and it's available to everybody, then we got to be competitive everywhere, too, particularly given the fact that we've got a completely aligned and synergistic merchandise strategy between Direct and in-store. So yes, it's a real issue. And I think that we -- it's given us an opportunity to partner with our large vendors more and talk about that. And it's a sensitive subject as you might anticipate. But yes, it's definitely of concern for us. We don't -- I guess I would say about that, we don't have any increased plans around promotion. But we will continue as we've always had a philosophy around not being undersold on the exact same product. And I think it's important that we're transparent with our vendors and with customers about that. Michael G. Koppel: And Oliver, on the second part of your question on full-line comps, the guidance does take into account current trends through the first quarter of this year and then we expect some improvement as the year progresses.

Our next question is from Paul Trussell from Deutsche Bank. Paul Trussell - Deutsche Bank AG, Research Division: You mentioned that Canada, I believe the dilution was about $35 million or so expected for '14 to the EBIT line, up from the $14 million this past year. Just as we go forward and you open up additional doors, how should we think about the direction of that impact to the P&L? Michael G. Koppel: Well, directionally, over the next roughly 3 years, as we're opening the new stores, we should see that impact grow. And then as we get to the point where we're fully comping those stores, we'll start to see it become accretive. Paul Trussell - Deutsche Bank AG, Research Division: Okay, that's helpful. And then just to follow up on a comment you just made on the full-line stores. You mentioned -- if you can just give me a little bit more detail around some of your in-store initiatives there. I just visited one of your newly remodeled stores in Tampa that looked very good. Could you speak some of the expected returns from these investments you're making to improve the full-line doors? Michael G. Koppel: Sure. Erik, can you take that question, please? Erik B. Nordstrom: Sure. Well, I would, first of all, reiterate an earlier comment that the first thing we would look at is the customer strategy, how do we serve the customer best, which may sound obvious but it's easy to get stuck into protecting one channel versus the other. Channel is something -- I've never heard a customer use the word channel. They want the experience they want. We have great assets online. We have great assets in our stores, and our opportunity -- our challenge is to leverage those assets to serve the customer better. For stores, I think you can bucket our efforts into 3: one is product; two is the in-store experience; and three, the environment. And it's briefly around products. You touched on some of them. We have momentum in Women's Apparel, the changes of adding Topshop, changing Savvy has allowed our mix -- total Women's business to be much more compelling and we're on a good path on that one. We've also been focusing on tentpole brands, big national brands, all through our stores that not only having more breadth and depth with them but highlighted them more to ease the navigation in our store so customers understand these brands. They understand how our stores are organized better. The in-store experience, there's services where we must win and that certainly includes our traditional high-touch approach, things like our get connected program. Our personal stylists, which we've talked about for a couple of years now, continue to grow. We still have unmet demand with customers who want to be served at a very high touch way and that's a good fit for us. But a lot of it is changing. Some of it's technology. We've been rolling out what would be awesome [ph] devices. We have tablets to make our POS completely mobile. This gives us much more functionality and security with our customer information. And then I think the real new bucket, the interesting bucket is the synergies with Direct, things like for a couple of years they've been taking online returns in our stores. And even though online returns are free for customers, most customers prefer to bring their online returns to our stores. That's a win for the customer experience and it's a win for us in being more traffic in our stores. We think there's a lot more to be done there. They're really scratching the surface. And ultimately, this could be the field where stores are really [indiscernible] win or loss, that can we, through our store assets, make the online experience better and vice versa? So there's lots going on there. Then lastly, store environment, [indiscernible] that you talked about, we continue to see good lift from our store remodel investments. And actually the last 2 years, our lifts have been a little better than they've historically been. So you mentioned Tampa. We have a number of remodels last year that we've seen very good performance with. In general, I would say that the direction of having more flexibility to our space has helped greatly in showing us these national brands, showing us some of our products and it's helped the customer navigate easier. And it has also helped us to keep our stores fresh. We've added things in some of the bigger stores like pop-up shops and having flexible space allows us to do that. So we still have an investment plan to refresh our stores. As Mike touched on, we need to be more efficient with that and we think we have found ways to do that. We learned some things with last year to where we can update our stores more cost effectively. But we continued to see a nice sales bump from when we do remodel our stores.

Our next question is from Paul Lejuez from Wells Fargo. Paul Lejuez - Wells Fargo Securities, LLC, Research Division: On merchandise margins, can you just talk about what the merch margin decline was during the fourth quarter? And I think this might have been asked earlier, I'm not sure if I caught the answer, but what did that look like in full-price versus Rack and even if you can talk about e-comm? And then just a follow-up, can you just remind us what percentage of your stores, full-line stores, are mall versus street locations and how the -- each of those performed? Michael G. Koppel: Yes, Paul, this is Mike. We don't specifically break out merchandise margin from gross profit. But what I will directionally share with you is that the decrease in the gross profit, a portion of that was related to merchandise margin. The other portion was related to the mix and the Rack, as well as the Fashion Rewards program. In terms of breaking it out, most of the -- really all of the pressure in merch margin was from a regular priced business, where we saw most of the promotional activity and that was reflected both in the stores and online, where we tried to maintain consistent pricing and respond consistently across channels. And then I think your other question about mall versus standalone, I mean, other than our major downtown urban stores, most of our full-line store base is all mall based. And as far as drawing any kind of pattern between the sales performances, I don't think there was anything significantly different.

Our next question is from Robert Drbul from Nomura Securities. Robert Scott Drbul - Nomura Securities Co. Ltd., Research Division: I just have 2 questions actually. The first one is on the pack and hold inventory at the Rack. Can you just talk about what you're seeing and like the opportunities that are out there and how you're capitalizing on that? And then the second question is, how did the Seahawks' run impact your business in the fourth quarter last year? And how should we think about that for the fourth quarter this year? I'd like to hear your forecast on that. Blake W. Nordstrom: We need a repeat performance by the Seahawks. Michael G. Koppel: Well, one of the things they taught us during holiday season was we needed a better defense. Go ahead, Blake. Blake W. Nordstrom: So Bob, this is Blake, and I'll start with the Rack and the pack and hold. That's something that's been -- we've been pleasantly pleased or surprised with on the upside as we have enhanced the Rack store count. One of the things we're extremely sensitive to is the mix and availability of the product that we aspire to carry for our customers. And we've just been able to really enhance the partnership with our top vendors and get first call and get better access and pack and hold is a way to leverage that partnership. And so it enables us to provide the best product and improve flow for the customer. It also is a great facility for us as we opened these new stores, to open a new store with the right content of inventory. So that's been growing with the availability and it's really, really working well. So we give that high marks and we're encouraged by that access and how the customer is responding to it. And the Seahawks, we did benefit, at least here in Seattle, that anything that had Seahawk related to it, gloves, hats or T-shirt sold really well. The flip side to that, when the game itself was on, tough on the business and there was a huge parade that following week, that was a little tough, too. So but overall, the pride in the city of Seattle is terrific and everyone's really excited about the Seahawks.

Our final question today is from Michael Binetti from UBS. Michael Binetti - UBS Investment Bank, Research Division: Could you -- I apologize if I missed this a little bit. But is there any way you could talk a little bit about the gross margin cadence for the year and how we should think about the first quarter? I see the inventory up. I see that it's largely for strategic reasons. But we do know there's more promotional holiday for the industry. I just want to think about maybe the first half of the year versus the back half on the grosses. And then I had a follow-up. Michael G. Koppel: Yes, Michael, we normally don't give that kind of guidance by quarter as it relates to margin. But what I will do is address your question on the inventory levels. And the increase, I think, you're looking at is on a sales per square foot. We're up about 9% in inventory and then sales were up in low-single digits. And there's 2 primary drivers to that. One is what Blake talked about, is the continuing investment in the pack and hold. And the other thing really is a function of timing. You may recall last year was the 53rd week, so we had 5 weeks in the month of January. And the last week of the month, we basically had more reductions to our inventory than we did have adds to the inventory. And so that's kind of a phenomenon that happens with that 53rd week. And so if you look at the period -- the year before and then the period right now, the increases in inventory are roughly the same. So we feel good about it. And as Blake said earlier, our aging is in really good shape. And by the way, the amount of clearance inventory we have right now is the lowest it's been in 5 years, so that's really not an issue for us. Michael Binetti - UBS Investment Bank, Research Division: Okay, that's helpful. Is there -- can I just follow that up real quickly? Michael G. Koppel: Sure, go ahead. Michael Binetti - UBS Investment Bank, Research Division: Okay. So the -- I think if we think a little bit further out into the year, if I look over the last few years, I'm wondering if there's any change to the strategy related to the annual sale events with the full-price business. And I asked because it hasn't sounded like you've been excited about those events the past few years and commented that's really not what drives excitement for that full-price customer. So as we kind of start getting into the year and start thinking about those events, have you guys changed your thinking about that at all? Peter E. Nordstrom: This is Pete. I would say, well, we have 2 different events, one is the half-yearly sale, which, obviously, we have 2 of those. And those are kind of a pure clearance event. They have become less and less important to us over the years because we take markdowns in a more timely fashion rather than kind of wait up for a period of time, and that's actually played out really well. If you just look at our margin performance over the year, that's been the right way to do it. So we -- as you probably heard us talk about a lot, the main thrust of our focus is to try to get new products in there and sell at full price. Our customers seem to prefer that and that's what works well for our business. But the markdowns are a reality of just the business that we're in. The other event is the anniversary sale that happens in July. And I would guess on the -- well, not guess, I would tell you for sure on the contrary to why we have kind of the celebrating thing happening at half-yearly clearance sale is the anniversary sale is something that we apply a lot of energy to. Our customers love it. We intend to keep growing it and making it as great as it can possibly be. It's great for our business. We generate a lot of sales during a slow period of time, and customers really love it and it engenders a lot of excitement and loyalty to our business because it's such a great opportunity for them to buy terrific brands at great prices. Robert E. Campbell: Thank you for joining us today. As a reminder, a webcast replay of this call, along with our slide presentation, will be available for 1 year on the Investor Relations section of nordstrom.com under Webcasts. In addition, there's an overview of our performance and growth strategy at the end of our slide presentation. Thanks for your interest in Nordstrom. Bye.

Thank you, and this does conclude today's conference. You may disconnect at this time.