Ever since the improvements in AI (artificial intelligence) and NLP (natural language progression), modern chatbots have been getting heavier and heavier in use. We interviewed marketing veteran Padraig O'Connor to explore the power of chatbots as a marketing tool. He notes the implementation of chatbots is vital for businesses to stay ahead.
“Being on the right side of conversational AI will fuel business growth and free humans for complex tasks rather than mondaine requests,” says O’Connor.
The thing is that, while chatbots were always a great idea, there were some cons to using them. The biggest one was the fact that customers often disliked the idea of talking to a bot; however, what happens now that they can no longer tell the difference (at least not reliably)?
The short answer is that the argument against using chatbots in marketing is getting weaker by the minute. To show you just how compelling this is, here are five ingenious ways you could use them.
image source: Unspalsh
1. Customer service
Speed is the name of the game when it comes to customer service. In fact, it’s one of the two things that matter the most (the second one being a successful resolution of a problem).
Sure, if you eventually solve the issue, the speed becomes of minor relevance as long as there’s no new problem. The next time, they might be hesitant to even go through the entire process. Instead, they might just choose to leave and go somewhere else.
Chatbots were always quicker; however, their downside was the fact that they provided generic answers and only worked as intended in the most specific of cases. Well, this is no longer the case. Today, chatbots have an easy time of passing a Turing test.
Padraig highlights the growing sophistication of chatbots: they're not just faster, but also more accurate, sifting through vast information to deliver a near-perfect answer to customer questions. In the past, they were just capable of resolving some rudimentary issues; however, today, they do more than just act as a substitute for FAQ.
It’s not about replacing customer service representatives. It’s about getting the best of both worlds. Just think about it. If the best customer service representative could deliver a service that’s 10/10 but could only do it in 30 minutes because they’re busy, and a chatbot delivered a service that’s 8/10 but could do so right away, what would you take?
Drawing on his marketing experience at Wealthsimple, O'Connor emphasizes how chatbots will simplify the complex world of personal finance. He points to Klarna’s implementation of a customer service chatbot as a textbook case. Klarna is a buy now, pay later service that lets you split your online purchases into installments. Since implementing a chatbot they have seen immense success. Their chatbot is:
Handling two-thirds of all Klarna’s customer service chats.
On par with human agents in regard to customer satisfaction score.
Now resolving customer inquiries in less than two minutes compared to 11 minutes previously.
The reason why this plays into your marketing so heavily is because a lot of existing customers and first-time customers take customer service as a major factor. "Offering a great customer experience is key to customer retention and loyalty and customer service has a big part to play in this," says O’Connor. He would know given he has vast experience in growing startups like Brightwheel. As one of their first growth marketing hires he scaled their paid media and marketing automation strategy.
2. Preferred way of communication
According to some data, roughly 63% of customers would rather message than call or send an email. Not only that, but they’re more likely to shop from businesses that they can contact via chat.
There’s a strong correlation between these facts. For instance, there are not a lot of customers who just buy without doing any research. This research sometimes includes contacting the seller in order to ask a few additional questions.
Now, if the seller is not available via message, they could go out of their way to inconvenience themselves and call or send an email. They could also just go to another seller. There’s no shortage of those, and it’s far more convenient for the customer.
The downside of traditional chat (and a reason why so many businesses don’t use it) is that it requires an incredibly large workforce. With an email, you can just go through them later on, and the customers are more understanding of the fact that you’ll need more time. Answering an email within four hours will be considered speedy, but answering a chat message in 30 minutes is all but.
According to O’Connor, this is why, with the best chatbot software, you can gain all the advantages of chat (like rapid responses) with minimal drawbacks. Padraig adds that “In 2024 consumers crave instant answers, a trend fueled by chatbots. Businesses must adapt or risk falling behind.”
At the end of the day, while there are more buyers than businesses, the distribution is never proportional. Each buyer represents a market of its own. Converting each buyer is a scenario similar to a coin toss (there’s a winner and a loser, regardless of the chance being 50/50). It’s all or nothing. A business with an offer that’s twice as good will not get a double number of clients - they’ll get them all.
3. Closer communication between brands and customers
Padraig explains that marketing is all about making a good impression on prospective customers and convincing them to use your product or service. The next stage is about convincing them to spend more or come back for more, potentially increasing their average order value or increasing their lifetime value. Later on, it’s about converting them into brand ambassadors that will advocate for your brand.
All of this requires them to trust your brand, and this trust is not just achieved through a great customer experience (CX). It also requires direct and personal interactions. There are four forms in which this is taking place.
Sharing quick answers about the product: They pop a quick question, and your chatbot gives them the answer they need in a matter of seconds. This is superior to any FAQ, and with the right bot software, it could make your communication a lot easier.
Resolving problems: Most of the time, your efficiency is evaluated by how quickly and effectively you handle problems. Sometimes, solving a problem quickly and effectively is far better than a scenario in which there’s no problem to begin with.
Providing more details: Even if you do have a good FAQ page and your product description (and a list of features) is elaborate, there’s something that’s missing. With the help of a chatbot, you can have the “experience” of someone who knows the product inside and out. With the right data sample and deep learning, this shouldn’t be impossible.
Customer support triage: Some issues have to be handled by your human customer support. This way, they get immediate response, and your team doesn’t get overworked.
Consequently, you get better customer relations and better use of customer support resources.
4. Saving time and money
Now, when we say saving money, the majority of people immediately assume that this will result in a better net balance at the end of the month. In reality, it means saving up resources that you can invest better into something else.
First, how does switching to chatbots save money?
The simplest answer is that it helps you keep the same efficiency with a smaller team. O’Connor also points out that chatbots improve employee morale as they don’t have to continually solve the same queries. However, it’s not just about that. A chatbot doesn’t have to be retrained or onboarded again every time a member of your customer support leaves, and you get a new hire.
Moreover, a chatbot never gets sick, it never takes a day off, and it provides the same support during odd hours without charging for overtime.
It doesn’t mean that a chatbot will replace an actual customer support representative. On the majority of customer support (or “Contact Us”) pages, you would see the hours during which the customer support was available. In other words, it just means that it’s finally cost-effective for customer support to provide around-the-clock support.
Moreover, you can spend this saved money (and time) on other marketing methods. We’re talking about SEO, email marketing, hiring a content marketing team, or a social media manager. All of these methods provide a great ROI, but affording an increase in investment on account of your customer support always seemed somehow wrong (not to mention counterintuitive). Now, you can have your cake and eat it too.
5. Generating more leads and revenue
The best thing about these chatbots is the fact that they’re active while the customer is still on your site. This means that once they’re already there and ready to buy (in a scenario where all they need is a little push), you have a system that’s more than ready to spring into action.
Just think about a person who entered your store (it can even be a physical store) waiting to ask something about a product while you’re busy with another customer (or stacking some products on the shelf). How long do you expect them to wait around? At what point will they just leave?
At the same time, they could be interested in just asking around, but the feature that you stress out or an extra deal that you mention at that given point could make them reconsider.
O'Connor explains that you can have different prompts for your chatbot on different web pages. “On the pricing page, the chatbot could help a user get a quote. On the checkout page, they could be reminded of incentives like free shipping.” This makes it easy for consumers to be persuaded to purchase from your business. “At HubSpot, that’s exactly how we executed our communication with customers based on the pages they viewed and product usage.”
Sometimes, your customers just need a bit of guidance.
This is why asking loaded questions like:
What are you looking for?
Did you forget something in your cart?
Would you like personal support?
It could make a difference between a purchase and a shopping cart abandonment.
A series of qualified questions is not enough. You also need an engine that can personalize them and adjust them to the necessary context.
The potential of chatbots in marketing is incredible
The bottom line is that marketing is all about communication, and chatbots improve channels of communication in every conceivable way. They save resources (that you can use better) and help you both attract new customers and build relationships with old ones. O’Connor adds that having a conversational AI strategy will be key for businesses to win in this decade. He explains that the process of creating a chatbot is getting easier. “Chatbot software allows even non-technical marketers to develop basic chatbots. That said, large organizations will have agencies specializing in the field of AI staffed to develop their chatbots.” Overall, the potential is incredible, and the cons seem weaker with each wave of AI advancement.
