E-commerce grew 20% for Costco in fiscal 2015—20 times faster than store sales.
IBM is providing its Watson artificial intelligence technology for Fluid’s personal shopper app, which apparel brand The North Face has been testing as a way to answer shopper questions and provide recommendations.
Meet Watson. He’s IBM’s attempt to create a computer that can think like—and process data created by—humans. He’s already predicted injuries in tennis players and personalized brain cancer treatment. And soon, he’ll offer advice on e-retail purchases, just like a knowledgeable retail sales associate.
IBM partnered with digital agency Fluid Inc. to create an app called Fluid Expert Personal Shopper that will harness Watson’s know-how.
In an extension of the partnership, IBM announced an investment into the Fluid XPS app. IBM is pulling the investment from a larger pool of $100 million earmarked for direct investment in apps using Watson, but the company declined to say how large this specific investment is.
Watson uses artificial intelligence to engage in a dialogue with people, improving its interactions over time. In what IBM considered the final test of Watson’s learning ability, the machine defeated in 2011 the top two competitors of the trivia game show “Jeopardy.” IBM says Watson’s analysis considers the context of words to determine which are most important, rather than just picking out key terms.
The Fluid XPS app aims to bridge the gap between product research and product purchase. Although 40% of shoppers use social, location and mobile technologies to research purchases, less use those technologies to actually buy products, an IBM Institute for Business Value study found.
“By tapping into IBM Watson’s cognitive intelligence, Fluid is infusing the personalized, interactive feel of an in-store conversation into every digital shopping interaction,” says Mike Rhodin, senior vice president of the IBM Watson Group.
IBM and Fluid launched a prototype with retailer The North Face and have been working on making the app market-ready. Through this prototype, Watson has been learning how to answer consumers’ questions, learning from their responses, engaging in conversations and tailoring product recommendations. For example, a consumer could ask Watson what outdoor gear is best for a five-day hiking adventure in Phoenix in June. The North Face did not immediately respond to a request for comment.
The Fluid XPS app is expected to launch to the public this year, though an exact timeframe was not given.
The North Face is one of several brands owned by VF Corp., which is No. 110 in the Internet Retailer Top 500 Guide.