Dive Insight:

Nordstrom has significant ambitions for tech-powered growth, but lately results have been erratic and investors have balked at its five-year plan. In a recent presentation to investors, the retailer said it is focused on making more investments in digital, as well as in full-price, off-price and new markets; improving profitability and returns to investors; and maintaining disciplined capital allocation. The retailer is taking a step toward fulfilling its digital mandate with the hiring of Mesrobian.

Nordstrom is incorporating a number of tech advances in its new stores. For example, its first men’s store in New York blends merchandise and technology like digital self-serve kiosks and a wireless communications system called Theatro. A second Nordstrom Rack store which opened last fall in New York included visual search technology to create a better omnichannel experience.

Nordstrom has also been investing heavily in e-commerce, spending $300 million annually, as reported in 2016. A new report from Moody’s Investor Service released last week said department stores are outpacing the wider retail market in online transactions at 22% of their total sales online, compared to about 13% for the overall retail industry. The report singled out Nordstrom for doing well in its mobile capabilities, as well as in related supply chain reforms.

To bolster its mobile and digital strategies, Nordstrom acquired two retail technology startups earlier this year. BevyUp provides a digital selling tool and MessageYes has a technology that enables conversational commerce. At an investor event last month, the retailer said it plans to become the “best fashion retailer in a digital world,” reported GeekWire. That will be a challenge with Amazon expanding into the fashion and apparel business, and Walmart rolling out an online “fashion destination” that includes a Lord & Taylor flagship store, as well as premium brands like Tommy Bahama, Lucky Brand and Effy. That challenge becomes more doable with the long-delayed hiring of a technology chief.

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