Chatbot Tracker: Weighing Your Options

Chatbots are everywhere these days and are hot topics of conversation among retailers. Learning how to best leverage this relatively new interactive revenue option with smart technology and artificial intelligence (AI) that provides instant consumer feedback, automates routine processes and enhances overall retail operations makes chatbots alluring.

Having a chatbot is nothing new for the retail industry. In fact, retailers have had some form of chatbot installed on their websites for quite some time. Sometimes seen as a small pop-up window in the lower right-hand corner of the screen welcoming visitors to the site — and offering up assistance or a help link on the contact page — these smart technology bots have traditionally been utilized by retailers for customer service-related issues.

Within the past year, though, Facebook has been given credit for helping to revitalize chatbots. In its Messenger announcement at its 2016 F8 developer conference, the social media giant announced its instant messenger app would allow brands to develop their own chatbots inside the site for easier, more tailored consumer access. A year later, Facebook can claim well over 100,000 chatbots now implemented through its Messenger platform, and many companies have added innovative features like processing payments and placing food orders.

But, as with any piece of new technology that's looking to alter the operations process of a business, chatbots are an add-on tool should be evaluated to determine whether adding the AI solution is adding any value. Adding a piece of technology — especially smart technology — without weighing out its value add will likely result in wasted time and money for multiple involved parties.

According to analyst firm Forrester, retailers without a clearly-defined strategy prior to investing in chatbots will see their implementation fail considerably. In its research report, Chatbots Are Transforming Marketing, author and Forrester analyst Xiaofeng Wang discovered many chatbots are being launched too early in a company's process, causing poor success rates across all industries.

"The fact that most chatbots disappoint today doesn't mean that marketers should give up and stop experimenting," said Wang. "If marketers can clearly define the purpose and scope of a chatbot, thoroughly evaluate the benefits it can bring and plan and execute it well, it can deliver business and customer value."

Again adding value is key. Without providing some sort of boost to a retailers' overall operations and strategies, new AI technology like a chatbot isn't likely to be successful.

In a recently contributed piece to The Next Web, GPShopper's co-founder and CMO, Maya Mikhailov, shared her thoughts on how retailers should approch chatbots when considering them as an extra tool in their retail arsenal.

"Retailers need to understand that chatbots are still in the beginning stages of their evolution," Mikhailov said. "The technology is going to continue to evolve, but for now, handing over essential services like customer care should be approached with caution by retailers — or else they will risk alienating an already fickle customer base."

Once the evaluation process is complete, retailers will likely need to continually refine the way in which chatbots are used, should they choose to develop their bot own for customer use. Cases of automated messages coming from these bots have started to spring up, something that can turn customers off from retailers' brands. The need to have chatbots interact on a very basic to somewhat complicated level with customers is crucial for retailers' success.

To help combat this, Amazon announced its contest to entice smart technology and AI-focused developer teams to put together a chatbot that can best "converse coherently and [engage] with humans on popular topics for twenty minutes." The winning group receives $2.5 million.

Given the popularity of chatbots as a hot topic of conversation in the marketing realm, a retailer might believe that not having one for its brand could be damaging. Out of the two billion members on Facebook, however, only 1.2 million are active monthly users of its Messenger chatbot. While it seems there are many benefits to chatbots as far as gathering customer details, it does not appear that people have caught on to using chatbots in everyday life. This is something that will likely change over the next few years.

In other bot news this week, Facebook shared it put the kibosh on two chatbots that had started to create their own language to communicate with one another.

The latest research report from Research and Markets, Chatbots Market By Type, Usage, Deployment Type, Industry Verticals, End User - Global Forecast to 2021, shows the chatbot market is set to reach a revenue of $3.1 billion by 2021.

Whether chatbots are a necessity or not for retailers is yet to be determined. Retailers looking to use chatbots as a value add must first weigh out all of their options as they move forward with development and implementation. What is known now is that retailers should be approaching chatbot development and use with caution.



About: Accelerating The Real-Time Payments Demand Curve:What Banks Need To Know About What Consumers Want And Need, PYMNTS  examines consumers’ understanding of real-time payments and the methods they use for different types of payments. The report explores consumers’ interest in real-time payments and their willingness to switch to financial institutions that offer such capabilities.

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