Artificial Intelligence Digital Strategy Digital Transformation

Chatbot, a new customer relationship dimension

We hear and read a lot these days about chatbots, and even more since Facebook revealed during the F8 Facebook Developers Conference on April 2016 their new strategy around the integration of bot engine on Facebook Messenger.

“Bots are the new apps” declared Satya Nadella, CEO at Microsoft. What is that amazing enthusiasm about? Well, statistically, among all the applications that we install on our smartphones, 25% of them will never be used, and among the ones we decide to try, 26% will be abandoned after the first use (sources: thinkwithgoogle). So on a daily basis, people tend to use only few mobile applications on their smartphone even if they have a lot, too many actually.

And what about those Chatbots? Chatbots are artificial intelligence that are set up to achieve automated tasks. That is why they change the way we use the internet. They can be hosted directly on the company website or on a social network platform such as Facebook messenger.

Everything started when we decided to improve user experience on mobile phones and basically, to find new ways to simplify our day to day lives. With the personal assistant Siri on Apple launched in 2011, we loved to be able to schedule a meeting, to find a recipe on the web or to call our best-friend by a simple clic and using our voice to explain the request. But what can a chatbot do for you?

There are two kinds of chatbots: those which act in a pre-established framework, defined by their creator and those who “learn” how to answer to various issues or requests based on the exchange they have, we call this process the “machine learning”. The Chatbot can answer your request thanks to algorithms and defined key-words that generate pre-registered answers. Also, bots can be combined with a real human advisor who will be able to answer more specific questions thanks to the conversation history in case the robot can’t find the answer.

A Chatbot can be a personal assistant such as “L’Ami Ricoré” who offers to wake you up in a funny way with articles of even a free breakfast delivered at the office. “Jam” allows you to be aware of the new trends in your town but can also be set up to send you a weekly reminder on your facebook messenger conversation to advise you about what you can do this week-end depending on the weather. “Poncho” is “here to talk about weather” and send you the daily weather forecasts of your city. Meetic, Voyages SNCF, Ebay, Domino’s Pizza have their own chatbots too.

 

Why should companies use chatbots?

Let’s think about the devices that allow you to access to a chatbot. We can talk to a chatbot through a computer, a tablet or a smartphone. That’s what most people uses nowadays.

Indeed, in the French market as an example 74% of the population own a computer or a Laptop, 62% a smartphone and 32% a tablet (Source : We are social). Worldwide, we could identify 2,307 billion social media active users (31% of the whole population) and 1,968 billion social media users via mobile in January 2016. (Source: We Are Social). That can make an incredible target for companies who wish to acquire clients.

The chatbot has few advantages regarding consumer’s assistance: it can give an answer immediately, it can reassure if the consumer has specific questions, it allows online assistance 7/7 and 24h/24h, and it’s free.

For a company the chatbot can collect a large amount of data about clients such as geolocation or the consumer behaviour. Chatbots can be proactive to encourage a purchase with promotions, as an example when shopping carts are being in danger to be abandoned. The bot could send a pop-up automated message with a discount code to incite the customer to complete the purchase. The chatbot can also potentially reduce the dropout rate by answering questions.

Regarding the e-commerce market which is a growing industry (+15% of revenues in 2015 according to the e-commerce and distance selling French federation FEVAD), it can be an interesting lever in order to enhance the conversion rates. Indeed, in the customer journey, a lake of fluidity in the website or heavy pages that cannot be downloaded can be real issues.

In China, the Chinese google Baidu launched a conversational chatbot named “Melody” to provide medical services and help doctors easily diagnose the disease. This bot allows to ask questions and schedule an appointment if needed. It is used as a first step before the medical consultation. China has a conducive environment to this kind of new trends because this market is enthralled with new digital tendencies and new technologies but it doesn’t exists only in china since another digital American health start-up created a chatbot called “HealthTap”.  This one gathers information from customers to answer to a specific question. The chatbot search for similar questions and can provide various answers that can be useful and allows an instant free access to 100 000 doctors online.  While we might think that it’s a crazy idea, they will justify the creation of a chatbot like Melody basing their arguments by referring on a World Health Organization report saying that we will suffer of a lack of 13 million of doctors and health professional within 20 years…

 

chatbot
Whatever may be said, a chatbot does not replace a marketing or communication expert in the industry, who knows its markets and customers and it won’t replace a real salesman either because he won’t have his creative force and is not efficient in case of complicated requests or when the questions are not well formulated. We should rather see this as one of those tools available that expands the scope of a communication and develop or test new strategies as the bot on its own does not have the capacity to implement or to boost a brand strategy.

 

 

About the author

Julie DABOUT

Julie DABOUT

Student in Digital Business Strategy Master Program at Grenoble Business School