Rise of the bots
Bots are the new “apps” and they’ve come onto the scene just as quickly and with as much fanfare. Barely a blip on the radar in early 2016, over the past year there has been a bot-splosion with many brands adapting the technology to provide consumers with more customized and responsive service.
Big brands in B2C and B2B alike are watching closely to see how bots perform and whether they’re worth the investment. If you’re toying with the idea, wondering how they apply to your industry, or just wondering what all the fuss is about – here’s the skinny:
What are chatbots?
According to Webopedia: “Short for chat robot, [chatbots are] a computer program that simulates human conversation, or chat, through artificial intelligence. Typically, a chat bot will communicate with a real person, but applications are being developed in which two chat bots can communicate with each other. Chat bots are used in applications such as e-commerce customer service, call centers and Internet gaming. Chat bots used for these purposes are typically limited to conversations regarding a specialized purpose and not for the entire range of human communication.”
There are two types of chatbots
The first are those that are designed to serve a specific business purpose. These types of chatbots are most commonly used for customer service or to answer FAQs about a product or service. A great example of this kind of bot is Next Train NJ. This Facebook Messenger bot allows users to find out when NJ Transit trains are departing or arriving from any destination along the NJ Transit route.
The second type of chatbot is powered by artificial intelligence and is designed to learn from its interaction with users. These types of chatbots are programmed to get to know their users, anticipate needs, and enhance their knowledge of the user based on the user’s interaction. A great example of this type of bot is the Macy’s On Call chatbot. This chatbot was built with IBM’s Watson and is designed to mimic the experience of in-store shopping. Shoppers use natural language to ask questions one might ask in-store, like, “where can I find Kate Spade handbags?” or “where can I find men’s casual wear?” and the chatbot provides web and store navigation, as well as information on sales and other products the user might like from their local store.
Chatbots for Business
Dharmesh Shah, CTO and co-founder of Marketing Automation software HubSpot, pronounced chatbots as the most important technology to come out in decades. But what makes them so special? The key differentiator is that, thus far, every piece of technology has required humans to learn a new skill set to successfully interact with it. Sure, the internet feels intuitive to us now, but that’s because we’ve learned how to navigate it and are always building on our knowledge to get smarter about using it. Chatbots are unique because they don’t require any additional knowledge from humans. We simply speak to them in our natural language and they respond. We’re already seeing how sophisticated these can become with C2B (consumer to business) products like Amazon Alexa and Google Home, and the technology is only going to get smarter and more customized.
Chatbots for B2C
B2C companies have been the first to jump on the AI bandwagon and are leading the way in on-demand services (like ordering Taco Bell) and delivering customized buyer experiences (like shopping at H&M) in what has been coined “conversational commerce”. These bots create an instant, anytime-anywhere brand experience that cannot currently be replicated in any other existing format, even human to human interaction.
Engaging with users on a series of levels, these bots extend and reinforce the brand by delivering a humanized, digital interaction, often in the personality of the brand. Some businesses are leveraging advances in machine learning to remember the user’s behavior and adapt interactions over time to provide a tailored customized experience.
Even in its simplest form, bots address and alleviate a point of friction in the buying process, like having to search for answers on a website, or wait on hold to speak to a customer service rep. From a numbers perspectives these bots are reducing costs by increasing efficiencies, removing barriers to purchase, and boosting brand loyalty and repeat revenue, through personalized experiences.
Chatbots for B2B
“The use cases are equally as impressive and powerful as their consumer counterparts, enabling firms to build competitive advantage based on faster access to data, more informed decision making and better processes,” according to MindLink. Using chatbots to streamline traditionally complex or time intensive processes can yield tremendous benefits for B2B businesses. Internally businesses can use bots to answer HR questions, or pull reports, while externally they can be used as an online catalogue search assistant or allow for easy restock of previous orders. And these are just some of the ways that B2B companies can use chatbots to increase efficiencies.
However, the real value for B2B lies in its ability to assist the sales process. According to a study by InsideSales.com, 5 minutes or less is the optimum time to respond to lead. Waiting any longer than that results in a 400% decrease in the chance to connect with that lead. Most companies aren’t making the grade. Large and small businesses aren’t set up to accommodate an immediate response every time a lead comes in; and herein lies the golden opportunity for bots. A chatbot can reach out to a lead more or less straight away, keep the conversation going, and nurture it until it’s qualified for sales. In this way companies could see considerable efficiencies in sales opportunities and close rates.
So, should you build one?
Chatbots are showing a lot of value for all types of businesses, and they’re only going to continue getting better. As to whether you should run out and build one right now, well, that depends. Enterprise B2B businesses could certainly see return on investment to streamline HR processes and to start to reshape the sales process, while B2C businesses, particularly e-commerce, can reduce friction in the buyer’s journey and see increased brand loyalty from customers, especially with millennials.
If you’re thinking about building a bot, it’s critical to map out the pain point it will alleviate, the goal it will achieve, and the metrics you’ll use to measure its success and determine ROI. The most successful bots are delivering very specific experiences with defined end goals in mind. But if you’re business isn’t ready just yet, never fear. They’re not going anywhere soon, so there is plenty of time to identify the perfect scenario to enhance your business with a bot.