Why brands can't do without chatbots

Brands should invest in chatbots now if they want to get ahead of their competitors, said Kester Poh, co-founder and CEO of AiChat, a chatbot-as-a-service platform on Facebook Messenger.

Poh, who was also one of the speakers at Publicis Media’s NextTECHnow at Singapore’s Innovest Unbound 2017 shared with Marketing that data collected from chatbots will be useful for these brands five years down the road in understanding more of what their consumers really want, and executing marketing efforts to drive sales.

Chatbot, which is relatively new in the market, is essentially a smart agent powered by artificial intelligence (AI) that allows consumers to interact though a messaging interface - more often than not, via their mobile phones.

Imagine, a virtual agent that can talk to 100 million customers at a time. This is what a chatbot can do for you. Like a human robot, it automates replies and routes potential customers to relevant service departments and even allows them to pay via secured payment platforms. Shopping, customer service, restaurant reservation, appointment booking, news update are all being slowly revolutionised with the chatbot 'magic'.

And while in the last few years the rave has been all about big data, chatbots are helping collect the very vital 'small data'.

Jonathan Ng, creative partner at Publicis Communications told Marketing that chatbots can collect what he calls 'small data' on consumer behavior.

“Chatbots can capture conversations between consumers and businesses. This in turn, will help brands design products and an 'experience' that matters in bringing customer satisfaction and brand loyalty,” said Ng.

Ng also pointed out that:

Creating a relevant experience is a new currency for innovation. But first, we need to understand the values that the consumers care about.

He added that with chatbots and its vast information collected, brands will be able to achieve that in the long run.

New conversational era

Without a doubt, the introduction of chatbots has brought about the beginning of a new era of technology, called the conversational interface. The way consumers communicate with brands via messaging, is largely different from how it used to be.

One brand which has been able to show how chatbots can improve daily mundane tasks is Philips Lighting. The company launched its first chatbot on their Singapore Facebook page in April this year, allowing users to purchase products conversationally through Facebook’s Messenger platform.

But it’s now in a testing phase to eventually let customers control the level of brightness of their light bulbs at home - as demonstrated at Singapore’s Innovest Unbound 2017 this week.

Imagine one can simply type ‘romantic’ or 'girlfriend is here' on the chatbot, and the lights will dim down to suit the required mood!

Another reason why brands should consider chatbots is also because, mobile is driving most digital growth, said Yuhsuan Chao, CEO of Botimize.

A comScore study earlier this year finds digital usage comes mostly from mobile, with Indonesia recording as high as 91% compared to 71% in both China and the United States (US). The same study also reports that most mobile usage comes from apps. China’s mobile app usage shot as high as 99%, while Indonesia and US reached 90% and 87% respectively.

That also means chatbots, which are most commonly used via mobile phones, will stand a better chance in getting the consumers’ buying attention. This will also aid in data collection. But Poh also added while brands are starting to look at the benefits chatbots and what they could possibly bring to the table,

China, with its popular WeChat, is already two to three years more advanced globally in AI chatbot technology.

To keep up, social media giant Facebook started to allow businesses to deliver automated customer support and guidance in e-commerce with interactive experiences with its chatbots on its Messenger since April last year. To quote Zuckerberg, he said:

Messaging is one of the few things that people do more than social networking.

This smart move not only ensured that it remains competitive with rivals like Kik, Microsoft and Telegram, but also opens up new opportunities for companies such as eBay, Burger King, Walt Disney, Uber and its Asian rival Grab to get chatbots on board their ecosystem. Following Facebook's steps, Skype, Oracle and Line also jumped on the bandwagon by opening up “Actions on Google” to allow developers to integrate services on Google Assistant in December 2016.

Challenges and limitation of chatbots

Chatbots are simple, fast, easy to use along with high user retention rate - but there are still limitations that we can’t ignore, said Botimize’s Chao.

"Unstructured data, which represents majority of what consumers would communicate daily, is still very difficult to process for these AI chatbot machines. That coupled with specific questions or commands. Plus, it still requires a great deal of time to train AI,” Chao said.

Speaking from his own experience, Poh agreed and said it is still a challenge for chatbots to handle high volume of enquiries from Facebook Messenger during peak hours.

Apart from that, there is a need for new sales channel to cater for the changing customer behavior towards messaging.

Despite all these, one thing we can’t deny – chatbots are here to stay and it is the brands and marketers mandate to analyse and assess whether it is something they should really invest in, right now or it’ll be too late.