The Rise of Chatbots in Internet Marketing

09/21/2017 08:56 pm ET
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Have you used a website and had a chat box pop up asking if you needed help? Or maybe you clicked a customer service button and got a chat window? You might have seen this while using Facebook, Skype, or Slack.

These chat windows aren’t connecting you to a person. They’re connecting you to a chatbot. A chatbot is a computer simulation of human conversation. The technology has been developed for decades but it has reached a point now where chatbots are trusted by businesses to handle customer service and ordering tasks on websites. But do they work?

Business Sure Think So

Chatbots are doing so well that Gartner thinks that chatbots may handle 85% of all customer interactions by the year 2020. People have reported higher satisfaction rates and companies have noticed higher conversion rates. Service times are faster and people are growing more comfortable buying through chatbots than they did over last year.

The bigger question is whether or not consumers will accept the results of a chatbot interaction as the fundamental basis for customer service interactions, like how we assume talking with a customer service line means we’ll be connected to a call center in a foreign country. It’s likely that there will still be some face-to-face or phone interactions between people and companies even if chatbots continue their boom, as there are still some things that computers cannot do. But they’re catching up fast.

Chatbots are also beating out apps as a method of consumer/customer interaction. Adidas tested out a chatbot app by asking people to sign up. Out of the 2000 people that did, 80% reused the app and 60% continued to use it after a week. Adidas says that is a far better response rate than their app.

Why Are They Popular?

So what is driving the sudden interest in chatbots? There are four reasons. The first is app fatigue. There are too many apps on our phones to pay attention to all of them. It’s really easy to forget we installed an app in the first place and that’s not good for brands who want to retain mindshare.

Second, chatting is extremely popular on mobile devices. In fact, it’s the preferred method of communication overall. Between WhatsApp, Facebook Messenger, and WeChat, nearly 2 billion people can be reached and the number is growing. Since chatbots work through these mediums, it has the potential for huge market penetration.

Third, companies are supporting chatbots like never before, even in conservative fields like law. Many different types of lawyers - from corporate to personal injury lawyers - utilize chatbots on their sites. Facebook and Microsoft released chatbot platforms last year that are used across many online chatting services. In addition to the ones mentioned, you can find chatbots for   Skype, Discord, Slack, and practically every other form of online chatting.

Finally, the costs have come down significantly. It’s even cheaper to make a chatbot than it is to make an app these days. The application interfaces are quite simple compared to an app, and chatbot providers have taken care of enough of the heavy lifting to make them easy to deploy.

Taken in combination, chatbots are poised to be the next killer app for businesses. Business Insider says that 80% of businesses will be using chatbots by the end of 2020 in some capacity. It certainly looks like we are on track to hit that number. Will your list of apps be replaced with chatbot interactions in your messengers? Time will soon tell.

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