The demand for customer service automation has increased rapidly over the last decade. As customers have grown more frustrated with the wait times and overall customer experience provided by traditional call centers.
According to an Aberdeen Group report, the customer service automation market grew from $8 billion in 2016 to $17 billion in 2021. At a rate of 20 percent compound annual growth rate (CAGR). The two primary solutions to this growing problem are chatbots and IVRs (interactive voice response systems). But what exactly are chatbots? And how do they differ from IVRs?
What are chatbots?
Chatbots are programs that use conversation to talk with people. Chatbot technology is used in dialog systems for various practical purposes including marketing, customer service, information services, and assistive technologies. They are also often included in operating systems as intelligent virtual assistants.
Some examples of chatbot virtual assistants include Amazon’s Alexa, Apple’s Siri, Google Assistant, and Microsoft’s Cortana. In a recent survey about why companies were showing interest in chatbots, 40% said their main interest was improving customer service and experience (eMarketer).
In another study by IBM from 2021, 74% of executives that AI-powered business solutions will be able to handle tasks previously requiring human interaction (IBM). There are many different ways businesses can utilize chatbots; here are some of them:
Why are businesses using chatbots now?
For many businesses, customer service is a challenging area. With more consumers connecting with brands via social media platforms like Facebook, Twitter, Instagram, and Snapchat, it can be difficult to keep up with questions or concerns in real-time.
Chatbots provide businesses with a way to deliver personal responses for any customer interaction at any hour of any day. When used correctly, chatbots can be helpful tools that lead customers through every step of their purchase process. Or provide them with additional information they may need while evaluating a product or service.
They also offer an opportunity for companies to collect valuable data about their customer’s preferences and buying habits. In fact, according to one study by Gartner, Inc., by 2020, 85% of customer interactions will be without a human (Gartner).
As such, chatbots are quickly becoming an essential part of today’s digital marketing strategy. What types of businesses use chatbots?
Customer Experience
Businesses in all industries are beginning to see how chatbots can help improve their customer experience.
At present, some of the most common uses include e-commerce. Providing customers with instant answers to frequently asked questions or helping them find products on your website; banking/finance: Providing account balance updates and other financial status updates.
Healthcare: Providing medical information based on symptoms and other relevant data points; travel/hospitality: Offering suggestions for nearby restaurants or attractions based on user location; communications/media: Sending news alerts and keeping users updated on current events.
Digital Marketing Strategy
If you haven’t already considered using chatbots as part of your digital marketing strategy. Now is a great time to start thinking about how you might leverage these new technologies.
Following are the steps you can take right now to begin implementing chatbots into your customer experience.
Step 1: Identify Your Goals Before you begin building out a bot. it’s important to identify what exactly you hope to accomplish with its implementation. Are you hoping to increase brand awareness? Improve conversions? Increase engagement? Once you’ve identified your goals, you’ll have a better idea of what type of bot would best serve those needs.
Step 2: Determine How You’ll Use Bots The first thing to consider when deciding how to implement chatbots is whether or not you want them to replace humans entirely or simply supplement existing customer service efforts. Some bots allow users to interact with live agents should they encounter difficulties while others rely solely on artificial intelligence (AI) capabilities. Decide which approach works best for your company before moving forward with development.
It can be difficult to manage multiple forms of communication with customers. And many companies don’t yet have a fully developed customer service team to do so. By implementing chatbots, businesses can scale their customer service programs easily and inexpensively. whether they eventually decide to hire more support staff or not.
The future of the chatbot market
Currently, it’s estimated that by 2022 there will be 200 million chatbots in use. This is a huge jump from just 3.5 million at 201. It’s thought that as many as 30% of businesses will have chatbot technology by 2022. In addition, 83% of senior marketing managers expect to use chatbots before 2022 is out. – Forrester Report Customer Experience with AI-Powered Virtual Assistants (Jan 2021)
