Are Chatbots The Future of Retail?

How many times have you heard the phrase this is the next big thing in retail”?
I’m going to guess probably more times than you can count on one hand. A simple google search of the phrase turns up several different next big things’, from holograms to psychotextiles, we’re told a different thing every day.

Enter chatbots. Sure, Siri has existed for a while but chatbots elevate the usage of AI to a new level. For those of you unsure what a chatbot is: bots are simple artificial intelligence systems that you can interact with via text/​chat.

The rising popularity of messaging apps

According to advisory firm Activate, over 2.5 billion people have at least one messaging app installed, with Facebook Messenger and WhatsApp leading the pack. Within a couple of years, that will reach 3.6 billion, about half of humanity. Many teenagers now spend more time on smartphones sending instant messages than perusing social networks. WhatsApp users average nearly 200 minutes each week using the service.

As a social media butterfly, I was alarmed when I read that the combined user base of the top four chat apps (Facebook Messenger, Whatsapp, Kik) is larger than the combined user base of the top four social networks.

A bigger user base than all of the social networks combined? An essentially untapped resource just waiting to be marketed to? That is huge. This is why today I’m going to go out on a cliché limb and say that I truly believe bots will change… Everything but especially retail.

3 Ways Chatbots Will Disrupt Retail 

1. Personalization

According to American research firm Gartner’s prediction, companies offering an increased level of personalization to their’ customers will outperform competitive brands by 15% by 2018. The ability of bots to read customer messages and analyze past purchasing behavior and browser history facilitates increased personalization for retailers. Sephora’s Kik bot serves up personalized makeup tips and product information to users by giving them a short quiz on their personal preferences. 

2. Payments

Facebook Messenger now allows checkout through chatbots. The addition of this service means that purchases can be made without ever leaving Messenger. This streamlines and creates a smoother customer experience because the bot will be able to offer a product recommendation in Messenger and complete the sale at the same time. 

3. Customer service

The most obvious one. The use of bots for customer service is not a new concept, but with the rise of the mobile, 24/7 consumer, it is easier than ever for customers to demand immediate responsiveness. The 2016 Mobile Messaging Report from Ubisend revealed that 63.9% of consumers believe a business should be available and contactable via messaging applications.

The time-saving ability to simply send a message to a brand and get an immediate response rather than dialing up a 1-800 and waiting on hold, speaks for itself. For the simple questions, it’s a win-win situation for yourself and the customer. Of course, they don’t have the answer to everything, however, that’s where humans come in. The perfect usage of bots is not to replace customer service, but to enhance it.

Gartner projects that more than 85% of customer interactions will be managed without a human by 2020.”

Needless to say, bots present several opportunities and take customer interactions to the next level. So, should you rush out and get a bot developer immediately? Maybe, but just like with any new technology investment, you should the take the time to do your research and find out which solution is the best fit for your brand. 

Learn more about staying relevant for the evolving shopper journey, download our free report titled, The Store of the Future’ below.