Dive Brief:
- Nordstrom and developer partner Snaps have launched the retailer's first-ever chatbot, a holiday shopping assistant that will be available until Dec. 24 on Facebook Messenger and Kik.
- Users of the chatbot will be prompted with various questions about people they are shopping for and other gift criteria, and the chatbot will reply with multiple shopping ideas. Users also can have the chatbot contact a human shopping assistant for more information.
- Snaps, which has worked with other major brands including Burger King, Dove, Pepsi, Victoria’s Secret, MTV, L’Oréal and Sony Music, estimates that Nordstrom will have access to about a billion people via the two messaging platforms.
Dive Insight:
Nordstrom is just the latest of many retailers to get the chatbot bug, although it sounds like the department store chain is taking only a temporary flyer on the technology for now. A holiday shopping chatbot is definitely a great idea, as shoppers need special assistance now more than ever, but it is not clear yet whether this is the first of many chatbots to come from Nordstrom, or if it sees chatbots only as occasional seasonal or event-driven accompaniments to its more traditional customer services efforts.
For much of this year, chatbots have been nice-to-have technology features for retailers, but as we move into 2017, it's probably going to become pretty clear pretty quickly that all major retailers should have a chatbot strategy. There may still be some hesitation based on assessments of their value as more for customer support than for direct sales generation, but that may soon change. Facebook, for example, has enabled newsfeed ads to link directly to chatbots, making them easier to find. Also, Shopify set up a direct sales channel on Messenger for its merchants. these are both move that probably will get is a little closer to closing more sales through chatbots.
Meanwhile, Nordstrom recently has made strides to better position itself to address e-commerce trends, shuffling executives in search of new energy and offering up new capabilities, like the retailer's recent reserve online, try on in-store mobile app feature. Rolling out a chatbot is another step in that direction.
Nordstrom last month reported third quarter earnings, beating expectations for the second consecutive quarter on the strength of its anniversary sale and off-price Rack business but undermined by a $197 million write-down on its Trunk Club online concierge service. Nordstrom reported a Q3 net loss of $10 million; adjusted earnings increased to $0.84 per share, trouncing analyst expectations of $0.51, while revenue grew 7.2% from a year earlier to $3.54 billion, ahead of the $3.48 billion projected by Wall Street. Nordstrom same-store sales rose 2.4% in Q3, Nordstrom.com sales grew 20.1% and Nordstromrack.com/HauteLook sales rose 23.2%.
