There are many advantages identified with having a chatbot. Organizations will most likely spare a great deal of cash while procuring more income with the assistance of these bots that work day in and day out for its proprietor without having a break. Subsequently, it is sheltered to state that the eventual fate of chatbots is splendid and shinning. Need help? Call us today!
Bots are finally starting to Win… Let’s explore what is working and what is coming next!
Marriott currently has 3 different chatbots and they are working on more. After seeing some very big early wins, 1–800 Flowers is going all in by developing bots for each major channel. All in all, bots are finally starting to win businesses over and according to an Oracle survey, 80% of businesses want chatbots by 2020.
There has been a lot of hype around chatbots and artificial intelligence with little to show for it …. until now. There are 7 big areas in which bots are helping companies and I will share each of them here with you. Finally we are starting to get clarity on the value that bots can bring and by and large the value is mostly B2B.
“The over-all point is that new technology will not necessarily replace old technology, but it will date it. By definition. Eventually, it will replace it. But it’s like people who had black-and-white TVs when color came out. They eventually decided whether or not the new technology was worth the investment.” Steve Jobs
Where Chatbots are Winning?
1. Ecommerce & Online Marketing
The ecommerce space has begun using chatbots in a number of ways that are quickly adding dollars to their bottom line. Let’s look at the early success stories:
- 1–800-Flowers: reported that more than 70% of its Messenger orders derived from new customers!
- Sephora: increased their makeover appointments by 11% via their Facebook Messenger Chatbot.
- Nitro Café: increased sales by 20 percent with their Messenger chatbot which was designed for easy ordering, direct payments and instant two-way communication.
- Sun’s Soccer: Chatbots drove nearly 50% of its users back to their site throughout specific soccer coverage; 43 percent of chatbot subscribersclicked through during their best period.
- Asos: increased orders by 300% using Messenger Chatbots and got a 250% return on Spend while reaching 3.5x more people.
So how are marketers and ecommerce stores using bots?
Email Substitute: Messenger Chatbots have higher open rates and click through rates than email. As a result many online marketers have begun using chatbots as a way of getting website visitors information via pop-ups. Once the user engages, they will be sent down a sales funnel bot style.
Sales Funnels: Just like email marketing, bot marketers are using sales funnels to segment audiences and sell products. In bots the sales funnel is interactive and dynamic. When a user says no, it is easier to find out why and send them to a different part of your funnel which can convert them at a later date.
Content Gamification: Since chatbots are interactive, they can make content more interactive and personalized. They can teach you something valuable, take you on a journey, and improve the relationship you have with a brand. As a result, we are seeing a lot of brands create experiences which tell a story and lead to a sale. Call of Duty used this strategy in launching their new game Call of Duty: Infinite War.
“We wanted to give our fans playing Call of Duty the first peek at the next game and a unique way to interact with one of the characters from the upcoming Call of Duty: Infinite Warfare,” said Tim Ellis, the chief marketing officer of Activision Publishing, in a press release sent to GamesBeat. “Messenger gives us the opportunity to engage directly with our fans in an interactive adventure that has never been done before — in Call of Duty or on Messenger. It’s been a lot of fun to see the community rally to work with each other and with Lt. Reyes on Messenger.”
This strategy was so popular that they received over 6 Million messages in the first 24hrs! This Messenger content campaign directly lead to sales of the new Call of Duty game!
Relationship Marketing: Bots are far more personal than using social media, like Twitter, or even email. It’s natural for users to project human characteristics on a chatbot and even develop feelings. As a result, brands really have the unique opportunity to develop a more personal relationship with users which increases customer loyalty.
…Now this is where the fun begins…
How Chatbots are Increasing Sales
Chatbots are increasing ecommerce sales in a really big way. There are a number of features that help bring this about. Here are the big ones:
- Upselling & Downselling: After a customer buys they are 33% more likely to buy again. This makes upselling right after a purchase a great opportunity to increase sales.
- Abandoned Cart: A whopping 68% of shopping carts are abandoned. Email has been a great way to recover abandoned carts recouping as much as 50%. Now chatbots are joining the process and as a result of higher open rates and click rates, they are sure to increase this number.
- Lead Generation: Messenger discovery can be a powerful way to get even more exposure for you brand. Additionally, Facebook has been suggesting bots as questions in conversations. For example, if you tell your friend you want to watch a movie, Facebook shows the Fandango Bot!
- Personalization & Predictive Analytics: Chatbots are a great way to segment your audience and put each of your personas in tailored experience. According to an Accenture report, consumers are 75% more likely to buy from a retailer that recognises them by name or recommends options based on past purchases. A great example of this is Amazon’s “frequently bought together” and “customers who bought this item also bought” prompts. Furthermore, a report by McKinsey estimates 35% of Amazon’s consumer purchases come from product recommendations based on such algorithms.
- Increased Retention Rates: When it comes to retention, bots are beating apps single handedly. Bots have the advantage of being transient, you don’t have to download them, sign up, etc… this low barrier to entry and low friction makes it easier to use them when you want on your terms. Additionally, as long as the experience and value proposition is good, it easy for the bot to contact you and start a conversation.
Keys to Success
The goal here is to start with a few really big wins and then grow your bot solutions to take advantage of big data and personalization.
Smart Messaging: This is one of the most important and least discussed value propositions of a good chatbot. Essentially, the messages should be smart which means that they have 2 inherent characteristics:
- Highly Valuable: The message is so valuable that your audience will be mad if they did not receive the message. For example, your banking bot should warn you if there there is ‘irregular activity’ on your account. A message like, ‘We see transactions coming from Barcelona, Spain. Are you traveling?’ would be ideal.
- Preventive: Messages that aim to solve a problem before the problem occurs. Everyone hates overdraft fees! A banking bot can help you avoid overdraft fees by sending you a warning message before the overdraft occurs. Currently, HiCharlie, does just this. Whenever a user is about to have an overdraft fee, HiCharlie, will send them a message like this, “Hi John, looks like you are about to incur an overdraft fee! Transfer $77 to your checking account before end of day account to avoid the fees!”
Check out how GoBeyond.ai is solving problems for E-Commerce
2. Customer Service
Companies are saving as much as 29% on customer service by deploying bots, according to McKinsey! BI Intelligence estimates that chatbots will equate to a $23 billion in savings from annual salaries. Additionally companies can automate 36% of sales representative positions, resulting in total annual estimated savings of at least $15 billion from salaries.
Customer Service Bots are a No-Brainer with an almost instant ROI
These are HUGE Savings and the trend will only increase. According to an IBM survey 65% of US millennials prefer going online to get support, rather than speak to staff in-store, so it’s clear that there is an appetite, for this technology and businesses can benefit in really big way.
Let’s take a few real life examples:
- Rodgers Wireless: had a 60% improvement in customer service
- Globe Telecom: increased customer satisfaction by 22% while decreasing call volume by 50% using a Facebook Messenger Chatbot. Employees productivity increased by 350%.
How Companies are using Customer Service Chatbots
- Customer Service with Smart Handoff: Most customer service calls can be broken down into the 80/20 rule where the same questions are asked 80% of the time. The best use of the technology right now is in automating the easy questions that get asked over and over again with a live agent takeover whenever the bot can not answer a question. When the bot is stumped, it automatically sends the question to a live agent and then listens to the answer and learns how to answer this type of question in the future. The most powerful aspect to this use case is that the system gets smarter over time and can handle more and more questions automatically!
- Internal Help Desk: What happens when a customer service agent doesn’t know the answer to a questions? Often times they ask an internal help desk and as you can imagine the internal help desk also gets the same questions over and over again. Bots can help both internal and external customer service teams.
- FAQ Automation: No one reads FAQ pages, what they do is email your company the question. Using AI we can now take a document and answer any questions regarding it. In fact, one of my partners did this with Wikipedia. You can ask his Wiki bot questions like, ‘Where is Barcelona’ and it will automatically answer it!
- Confidence Scores: How does the bot know if it should answer a question or hand it off? When a question comes in the bot will look to see if it can answer it and ascribe a confidence score to its answer. If the confidence score is below our pre-set threshold, it will automatically send it to a live agent and listen for the answer. It will then compare the agent’s answer to its own and improve! Using confidence scoring with reinforcement learning is key.
Key to Success
Start small and focus on the a handful of questions that would really make a difference if automated. Often times companies will start with the internal help desk in order to validate their models. Make sure to have an automatic live agent takeover when necessary and once you are seeing returns, reinvest in a self learning system.
If you want to learn more about how a Chatbot can help your Customer Service Team, you can learn more here.
3. Travel, Tourism & Hospitality
Chatbots are slowly becoming a big hit in the hospitality and travel industry. They are beginning to offer a higher-end user experience at a lower price point. One the biggest wins for bots are that they increase customer satisfaction and brand loyalty while lowering costs via automation.
Let’s look at a few examples of winners in the space:
- Snap Travel: $1,000,000 in Bookings
- Marriott: Use of chatbot services at the company has grown 85% month over month since the technology was launched via Facebook Messenger.
- KLM: Increased customer interactions by 40%, helped 15% of customers get their boarding passes via Messenger while improving Net Promoter Score.
- Wynn: Adding Amazon Echo’s to over 5,000 Rooms.
- Waylo: 50K Month in Revenue
Bots in this space are being successful on a number of critical fronts: 1) They Increase Revenue 2) Increase customer satisfaction 3) Increase Engagement and Brand Loyalty and 4) Lower Costs via Automation. Here is how companies are using the technology today.
How Companies are Using Chatbots & Ai
- Engagement Ecosystem: Marriott is creating a chatbot ecosystem that engages customer before, during and after their trip. Someone might use the chatbot to check availability for a visit to a Marriott hotel in Chicago, for example. Whether they ended up booking or not, the chatbot might later send links to personalized content such as articles about Chicago’s top restaurants, tours or other local experiences to explore. Once they book, the bot can let them check into their room, request guest services, order from the restaurant, suggest activities, and after they check out it will gather feedback and even ask them about any future trips they are planning or their dream vacations. Owning the experience from beginning to end and keeping the conversation channel open is key!
- Radical Personalization: One of the biggest challenges that the hotel industry faces is differentiation. Simply put, most customers compare hotels based on price and most often go with the best value (combination of price, brand, location) which puts hotels in the awkward spot of competing on price. Radical personalization will change all of this. Hotels will be able to offer unique personalized packages based on a person’s interest and bundle a number of activities together, in one package, that the customer would do anyway. For example, when me and my wife went to Chicago, we had dinner at Alinea (9th Best Restaurant in the World) and saw Hamilton, the musical. In the future, a travel bot will know our preference and the reason why we’re traveling and offer a more personalized package and a better value. By offering personalized packages like this, hotels can avoid competing on price.
- Predictive Analytics: Imagine that you are stuck at the airport due to a flight cancellation, what would you do? In 2014, Roof Inn used public weather and flight data to predict which customers would face flight cancellations. Based on the results of this predictive analysis, Red Roof Inn launched a targeted marketing campaign aimed at mobile-device users in the areas most likely to be affected by harsh weather. With predictive analytics we can solve problems before they happen and offer a very unique and compelling value proposition to users in real time.
- On Property Recommendations: Hotels are starting to use next-product-to-buy algorithms. These algorithms can analyze historical data to determine, for example, that a customer enjoys an early-morning coffee and is likely traveling with a spouse, and then use that customer’s cell phone location data to deliver a buy-one-get-one-free offer just as the customer walks by the hotel coffee shop in the morning. Moreover, there are additional opportunities to wow the client by dispatching a pre-ordered room-service dinner as the guest enters the lobby, or alert housekeeping that a room is available for cleaning as soon as a guest has departed.
- Customer Service Chatbots & Voice: The top 5% of travelers who spend 50 to 100+ nights a year, do so at the most premiere hotels, without consideration of price. The majority of this group gets their own personal concierge whom they can call anytime and for anything! For the rest of us, chatbots can offer a similar high quality service at a much lower price point. Hotels are already rolling out these types of bots which can provide a great customer service experience, suggest places of interests, and help you get things done via chat and voice. Moreover, since the technology holds state, this means you can pick up the conversation on messenger, email or via Echo in you room without having to repeat yourself -the system holds state.
- Smart Pricing via AI: One of the biggest opportunities is to use predictive analytics and deep personalization to optimize pricing. For example, a hotel might all of the sudden have an excess of rooms available due to a last minute cancellations as a result of a flight cancellation. To remedy the situation, the AI might drop the price and entice a list of locals to spend the night at the hotel at a special rate.
Overall, Bots are already helping increasing customer satisfaction and brand loyalty and this just the beginning. There are a number of startups that are offering Hotels Chatbots and Ai as a service. You can learn more here.
4. Banking, Financial Services & Fintech
Fintech has begun disrupting the financial services and chatbots are the latest medium to fuel the disruption. According to Gartner, consumers will manage 85% of the total business associations with banks through Fintech chatbots by 2020. Juniper’s new research, Chatbots: Retail, eCommerce, Banking & Healthcare 2017–2022, forecasts that chatbots will be responsible for cost savings of over $8 billion per annum by 2022, up from $20 million this year.
Many of the top banks such as Bank of America, Chase, Visa, Mastercard Capital One, American Express, Ally Bank, Barclays, Paypal already have bots.
Let’s look at a few examples of winners in the space:
- Chase: JPMorgan has numerous bots! COIN, has saved over 360,000 hours of manpower and its simple bots work by parsing emails for employees, grant access to software systems, and handle common IT requests like resetting passwords and more. Bots are expected to handle 1.7 million access requests this year, doing the work of 140 people.
- HiCharlie: This bot keep track of your finances so you don’t have to. On average Charlie saves users $80 per week!
- Sweedbank: Their chatbot, Nina, handles 40,000 conversations a month and resolves 81% of the issues.
- Trim: Trim is Financial Assistant bot that can help you reduce expenses and even negotiate bills on your behalf. Trim has a 94% retention rate!
How Fintech Companies are Using Chatbots
Smart Messaging: First and foremost, bots can help warn you about issues and dangers with your bank account. For example, if there are unauthorized charges coming from Rome, the bot can send you a message and find out if in fact you’re in Rome.
Companies like HiCharlie are taking this a step further by warning you about bank fees, overdraft fees, and other upcoming charges. To avoid these fees, simple tell the bot to move money from one account to another and just like that you have saved money.
Personalized Tips & Suggestions: The Banks of America bot can look into your account and give you suggestions on what to do with your money. It can give you a cost breakdown of where you are spending your money, how much your spending on servicing debt, and how you can move money around in order to save more money. Check out the video below:
Negotiator: Trim is one of the most popular bots and it works by focusing in on saving you money. It analyzes your spending habits and offers ways to reduce costs such as canceling memberships that you no longer use. Additionally, it can negotiate some of your bills for you, such as your Comcast Bill. It has saved users over $1,000,000 in the past 30 days.
Customer Service: Bots offer 24/7 customer support and can answer account questions and offer insights and suggestions thereby lowering costs and improving customer experience.
Internal Chatbots: Banks are starting to use chatbots internally to help automate tasks. The program, called COIN, for Contract Intelligence, does the mind-numbing job of interpreting commercial-loan agreements that, until the project went online in June, consumed 360,000 hours of work each year by lawyers and loan officers. Additionally, Chase, has created number other bots that solve problems like password reset, parsing employee emails to improve efficiency, grant access to software and much more.
To date we have consulted a number of Fintech companies. Chatbots are a no-brainer both internally and externally. This is one of the strongest verticals for chatbots. If your company is looking for strategic, design or development consulting, let us know here.
5. HR & Recruiting
One of the most exciting verticals for chatbots is recruiting and human resources management. Bots are helping at each step of the employee lifecycleand in the process decreasing HR head counts, decreasing costs and improving employee engagement.
According to a survey conducted by the Society for Human Resource Management, 38% of HR respondents said the primary challenge they face is “maintaining high levels of employee engagement.” Part of the problems is that most employee self service HR systems are old, antiquated and hard to use which leads to employees asking the HR department for simple requests. Bots are solving this problem by becoming a middle layer that can integrate with existing systems, while offering a much easier user experience for employees. As a result, Bots are improving engagement while decreasing the amount of time HR reps spend on requests by 30–50%!
Let’s look at a few examples of winners in the space:
- Maya: Automates recruiting steps such as sourcing, screening & scheduling. Save 75% of your team’s time.
- SGT STAR: US Army is using a chatbot to help answer questions and enlist future soldiers.
- SAP: This is a bot for managers that helps streamline tasks like employee look up, time logs, pending hours, etc. Additionally, employees can change address, request a vacation, or perform other self service.
- Wade & Wendy: AI chatbots that helps recruiting and employee development.
- Loka: This is a Slack bot that can answer HR related questions such as ‘who is my insurance provider’, etc.
How HR Bots are Helping Companies:
Recruiting: Chatbots and artificial intelligences are helping automate the recruiting process. For example, Tara.ai, used this approach to find and evaluate a developers on Github. The Ai system would evaluate the developers code, background, and give them a quality score.
Pre-Screening: About 75% of job applications are unqualified for the job that they are applying for. Chatbots can engage applicants and pre-screen them to make sure that they are qualified for the job by asking them a few simple questions. Wendy does just this, she is like a hiring assistant that understands the identity of your company and intelligently vets and delivers candidates who compliment your mission and culture.
Employee Training & Development: Training and developing an employee is an expensive, time consuming, investment. Chatbots like Wade, are simplifying the process by onboarding new employees to the company acting as an always-present advisor. Wade, recognizes that an employee’s career is equal parts journey and destination, and grows with the employee through their career.
HR Resources: One of the biggest use cases is HR Automation via Chatbots which allows companies to automate 30 to 50% of time HR Reps spend answering such requests.
- Documentation Requests: Whenever an employee wants to see their W2, last paycheck stub, or any other document the bot automatically respond 24/7.
- Personal Information Requests: Often times employees will have questions regarding PTO, their benefits details, 401k, insurance, etc.
- Update Personal Information: Employees can update their new phone number, address, marital status, etc.
- Process HR Requests: Bot can automate requests for PTO, vacations, sick days, etc.
- Proactive Problem Solver: Bots are also solving problems before they occur! For example, if an employee forgets to clock out, the bot can remind them. Additionally, bots can help validate working hours in states that require employee sign off. During W2 season, the bot can send out a reminder to update personal information before the W2 are sent out.
- Feedback & Reviews: Bot can get feedback and reviews from both employees and managers. Additionally, employees can make suggestions, ask for help, give feedback, and focus on ways to improve their performance.
One of our Biggest Projects was a HR Bot for one of the leading HR Companies in the US. Learn more about how we can help with your HR Bot, here.
6. Chatbots as Assistants
A subgroup of chatbots are already being designed to helps perform specific tasks. The best way to think of these bots as service providers that you can hire to do a job or task for you. Often times these tasks are internal and B2B.
Internal chatbots are on the rise and have the potential to fundamentally change the way we work. Currently, 45% of all job related task are automatable using already existing technology. Simply put, automation and bots are already starting to change the way we work and this is just the beginning. This is one of the most exciting areas for bots.
Examples of Bots as Assistants:
- X.ai: Ai assistant that schedules appointments for you.
- RossIntelligence: Ross is an AI Research Assistant who can perform legal research for law firms. ROSS users reduced their research time by 30%.
- DoNotPay: First AI powered robot lawyer that started out by overturning 160,000 parking tickets valued at over $4,000,000. Now the bot performs a number of legal services.
- Tara.ai: Automates Tech Projects by hiring and managing developers for your tech project. Average time to hire talent using Tara is 24hrs instead of 2 weeks. Projects also run 30–50% faster than hiring a development agency.
- Chatbot Conference Bot: Managed all of the details for the Chatbot Conference. Automatically introduced people to each other, increased Conference Day engagement via gamification, and increased sales by 20%.
- Internal Agents: HR, Customer Service, Sales, Slack Bots, Fintech etc…
How AI & Bots are helping Companies:
The majority of the use cases are B2B as companies are building AI systems and using bots as a layer that integrates current enterprise software with an easy to use front end which allows users to get value via conversations.
One of the segments that is being disrupted is legals services. Companies like Ross Intelligence, JP Morgan Chase, are using bots to automate a lot of the legal tasks that their attorneys previously had to perform. This amounts to a huge savings, as lawyers bill in the hundreds of dollars per hour. DoNotPay is offering a similar service to the public where it fights certain cases for you automatically.
In 2018, we expect this trend to get only stronger. Expect companies to continue to develop AI and bot technologies that automate domain specific tasks. Any task focused on predictive analytics/maintenance, forecasting, optimization, administrative, etc is ripe for taking. Most importantly, these projects generally have a massive ROIs!
If your company needs an internal Ai solutions, please let us know here.
7. IOT & Voice
Voice is quickly becoming a mega-hit and Amazon’s Alexa currently has a 70% market share with over 20 million units sold. By 2020, it is estimated that there will be 128 million smart speakers sold and that Alexa alone will be able to generate $10 billion of revenues. This is a massive opportunity for businesses.
Here are some of the things you can do on Alexa:
- Smart Home & IOT: Connect to smart devices and control your smart appliances with your voice.
- Transportation: Order a Uber or Lyft, get a price quote
- Travel: Book travel tickets, find out wait times at airport
- Entertainment: Listen to music, play games like Jeopardy, find a movie to watch.
- Cooking: Get food/drink recipe
- Shopping: Buy goods from Amazon, order flowers, etc.
- Order Food: Get pizza delivered.
- Fitness: 7min workout routine
- Productivity: Set reminders, create to-do lists, etc
- News, Weather & Finance: Listen to the news, weather updates, find out your credit card balance, get stock prices.
How are business making money with Voice?
There are 3 basic ways to monetize a skill. Companies can generate revenue by selling their goods and services. Uber, Lyft, 1–800 Flowers, Dominos, are monetizing Voice the good ole fashion way, by selling their product and services through voice.
If you build a popular skill, you can now charge a subscription fee for it. Customers who are not Prime members have the option to purchase a monthly subscription to a skill, like Double Jeopardy, for $1.99 a month.Customers can subscribe directly from the current Jeopardy voice app and can cancel at any time using the Alexa app.
Last but not least, Amazon will now pay you anywhere from $500- $5000 per month depending how popular you skill is.
One of the most exciting project we worked one during the past year as a IOT Chatbots that can make you a cup of coffee. Simple text the Bonaverde Berlin and presto, fresh coffee! One of the best features is being able to personalize a cup of coffee to your specific palet and share it with your friends.
We are on our way of seeing more and more use cases like this, where bots and voice automate many of our daily tasks both at home and at the office.