In the past few decades the corporate world has evolved rapidly. With technology advancing at a lightning speed, the integration of technology in conducting various aspects of a business has become more of a need than an option.
Chatbots are technological wonders that have revolutionized the world of technology. Companies all over the world are using chatbots to improve and upscale their businesses.
What are these chatbots?
Well, simply put, a chatbot is an Artificial intelligence (AI) software designed to simulate human conversation and interaction. The purpose of a bot is to provide virtual assistance to the users whether it’s answering a query, conducting online tasks or managing things in general. Chatbots have become so advanced now that they even help in doing your household chores. In a gist, a chatbot is basically a virtual robot that can mimic human interaction that can serve as a basis to perform various tasks.
You may not realize but you encounter chatbots on a daily basis as they all around us now. iPhone’s Siri and Amazon’s Alexa are chatbots, so is the voice that tells you which direction to take when you are using the Google maps. Also, the pop up window that appears on your screens when you are shopping online, asking if you need help, is a chatbot.
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There are numerous other examples of chatbots, such as CNN bots, cashQ money transfer bot, Duolingo, NatGeo genius, Hipmunk and Wholefoods. All of these interactive bots serve different purposes, like for example CNN bot gives you personalized news updates, Duolingo teaches you any language that you want to learn and Hipmunk is a travel related bot that helps you find travel packages etc.
There are mainly two types of chatbots:
- Task oriented chatbots: these bots are designed to perform a single task. Live chats, interactive FAQs etc. are task oriented chatbots. These bots are purpose driven like Hipmunk only assists you in travelling related queries not anything else.
- Conversational chatbots: these chatbots are more diverse and are designed to conduct various tasks. They are your digital assistants and help you in anything that you need. Siri and Alexa are conversational bots, so is Google voice assistant.
These two are the basic categories of chatbots; considering their complex nature they are further divided into subcategories such as button based bots, hybrid bots and omnichannel bots.
How chatbots help businesses?
Chatbots are mainly used for customer care services in the corporate world. In the past few years, many companies have started using chatbots for their customer service, and by 2025 the chatbot market size is estimated to reach $1.2 billion.
There are many types of chatbots that a company can use for its customer service. The most basic type of bot is a live chat that assists customers while they are browsing the company’s webpage. Some companies also use Facebook messenger as a platform- every time a customer clicks on the messenger icon on a website, an automated response is sent to them.
The kind of bot that you want to use depends on how far are your willing to take your customer service and also on the nature and the extent of your target market. For a retail store a simple live chat virtual assistant would suffice but for banking and healthcare you may need more advanced bots that are able to answer a large array of customer queries.
Whichever chatbot you choose, ultimately it is going to have a huge impact on your business. Here are some ways chatbots assist businesses,
Quick, Efficient and reliable
Unlike human beings who are prone to errors, chatbots are fast, efficient and extremely reliable. Where it would take a couple of minutes for a CSR to answer a query, a chatbot would provide a response in just a few seconds. A sales rep may also misguide a customer, provide inaccurate information or may not be fully equipped in handling certain customers. The emotion factor may also come in the way especially when dealing with difficult customers. Chatbots are more reliable as they rarely misguide the customers, provide accurate information and generate appropriate tailor made responses. Also a chatbot would resolve issues quicker than any human could possibly do. According to a study, 90% of businesses reported that with the help of chatbots they are able to resolve issues and complaints more quickly. Moreover, they provide 24/7 assistance and help customers whenever they need.
Reduced operational costs
It has been estimated that nearly 265 billion customer requests are made every year and it costs around $1.3 trillion dollars for businesses to cater to those requests. This cost includes the salaries given to the CSRs. Let’s say that you provide a 24/7 service to your customers and you do so through man power, you would need a large number of employees who would work on different shifts. This means that you would have to pay double the amount of money for two employees doing the same job but in different shifts. Chatbots reduce the need for manpower hence cutting down your costs. It is believed that around 30% of customer service cost is cut down when using chatbots.
Increased customer satisfaction
When a customers ask a question, all they expect is for their issue to resolved quickly and efficiently. Literally that is all they need. Issues only arise when these expectations are not met whether due to communication issues, lack of availability, misinformation or any other reason. Since chatbots are quick and seamless and provide accurate information, they greatly improve your customer relations. A survey found out that 44% of US consumers prefer dealing with chatbots rather than humans. Moreover, a study found out that 70% of millennials report a positive experience when dealing with a chatbot.
Personalized assistance and customer engagement
Usually when an issue is resolved, customers tend to end the conversation especially when you try to inform them about your other products and services. Keeping your customers engaged in a conversation after their work is done requires a lot of special skill sets and let’s be honest, not everyone can do that. Chatbots on the other hand have shown to increase customer engagement by giving personalized suggestions based on the background and online activity of the customers. For example Sephora has a virtual assistant through Kik that not only helps you in finding the product that you need but also gives suggestions for other products that exactly suit your needs.
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Many companies also ask customers to fill in an information form before browsing their webpage. Using that information, they then send automated emails and notifications to the customers, marketing products that would best catch their interest. This is also an excellent way to market your brand.
Chatbots are tremendously important in the new business era as it resolves customer complaints, identifies your improvement areas and automates the entire client experience helping you save millions of dollars.
