Nordstrom’s Acquisitions Show Personalization Will Continue To Be Critical For A Winning Customer Experience
By Tom O’Keefe, 4-Tell
Nordstrom has long been synonymous with the words ‘Customer Experience.’ Defining what it means to provide the white glove treatment — and proving that it equates to a fiercely loyal customer base — businesses have always looked to them for strategies to enhance the customer experience.
This is why Nordstrom’s recent acquisitions of BevyUp and MessageYes are intriguing. These investments speak to Nordstrom’s commitment of providing superior service through the omnichannel and personalization capabilities these technologies bring to the table. And it’s these capabilities that Nordstrom, and other industry leading retailers, will continue to double down on to meet consumers’ rising expectations.
Blending Online And Offline
Nordstrom’s acquisitions further support the importance of omnichannel experiences. While they were one of the pioneers of omnichannel strategies by providing in-store pickups and returns, their recent investments are a deliberate move to better blend digital and physical channels by seamlessly collaborating with consumers over the channels they prefer most — in this case, via mobile, in-store and online.
Many online-only retailers have invested in similar omnichannel strategies, by purchasing physical storefronts to increase the channels where they’re available to consumers. As many as 43% of retailers surveyed expect a net increase in the number of brick-and-mortar stores they operate by the end of 2018 compared with 2017, according to an NRF study.
While Nordstrom may have set the stage, it seems like all retailers are moving towards a robust and seamless brand presence across channels. In fact, 87% of retailers agree omnichannel is critical to their business, yet only 8% have mastered it — ensuring that the adoption of omnichannel tech and strategies are far from slowing.
Hyper-Personalization
Nordstrom’s acquisitions also prove they’re not shying away from hyper-personalization initiatives. It’s no secret that Nordstrom has always provided personalized interactions through their knowledgeable sales associates, but BevyUp’s platform will add a digital enhancement to in-store sales teams.
Historically, sales associates have used BevyUp’s technology to access customer information in-store and send customers product suggestions via text and email once they’ve left the store — enabling an end-to-end personalized experience.
Other brands, like Target and Amazon, that have led the personalization pack by integrating advanced digital technologies and proprietary data for customers are already seeing revenue increase by 6% to 10%. That’s 2X to 3X faster than those that don’t.
As personalization leaders such as Nordstrom stand to capture a disproportionate share of category profits, we can guarantee that the fight to create more personalized experiences through sophisticated technologies is only going to get fiercer.
Investing In Their People To Drive Loyalty
While technology may seem like the obvious solution for digitally driven consumers, today’s shoppers are best served by the benefits of enhanced human collaboration with technology. Up to 87% percent of consumers are still buying in physical stores, presenting opportunities for retailers to drive greater loyalty and influence purchases through the emotional component that’s inherent in sales-to-customer interactions.
Validated by Nordstrom’s investments, providing tools that give salespeople the insights to understand each customer and personalize experiences builds loyalty and long-term value for brands, while ultimately increasing revenue, restoring retail operating margins, supporting merchandising decisions and decreasing employee turnover.
As Nordstrom has demonstrated in their acquisitions, data-driven merchandising and an efficient human connection will offer retailers the best chance to survive the changing market conditions.
Smart retailers understand that the physical and digital experience go hand in hand, but customer-obsessed retailers will continue investing in areas like omnichannel, personalization and sales enablement technology to provide customers with the seamless experiences they expect and now require.
Tom O’Keefe brings 20+ years of technology experience to 4-Tell after previously serving as the CEO of AkeLex (a healthcare analytics company) and the CRO of ShopIgniter, a venture-backed social commerce provider. Given his years of experience in the e-Commerce industry, O’Keefe has an acute understanding of retail misgivings that have led to subsequent market departures, the strategy and tools that are shaping future market winners and the role fluid and personalized customer experiences will have in fueling long-term sustainable growth for B2B and B2C companies, specifically by driving customer loyalty and employee engagement.