Need to quickly refresh what a chatbot is? If yes – please read the below, if not – skip this abstract.
By “chatbot” we mean a self-learning autonomous software, that can respond to inbound requests and connect the operator if it is unable to process the query by itself.
Common features (de-facto the standard for the industry):
- Graphical User Interface
- Serve clients on site
- Be able to process complex queries
- NLP in real-time or close to real-time
- Connect a human operator into the conversation on demand
- Be easy scalable
Areas of application: E-commerce, Service Businesses, Insurance, Banking & Finance, Retail, Publishing and more.
Common Chatbot Strategies: automated database support, site assistant, automation of repetitive tasks, marketing purposes etc.
Chatbots: mere hype or a real opportunity
For a recent couple of years, technology market has shown unbelievable growth by introducing several perspective technologies every year. Marketers and enthusiasts claim them to turn out “life-changing”. Now many of them are speaking about chatbots. Are they right? We’ll definitely get the answer in the future. But when it becomes obvious that chatbots are here to stay, it would be too late for many companies to place their foot on market.
So the question: “Are chatbots really useful for business or just another overhyped technology that is still more than useless for daily use?” Should be answered right now. And to answer this, we’ll use several approaches to the question.
Approach 1: Evaluating Relevance and Business Problems Chatbots Solve
Issue #1 – Rocket-fast Respond to Requests Needed
In lead generation, the first contact with your potential customer is probably the most important moment. Of course, people take into account the common response time of the communication channel they use. For emails, an industry-standard timeframe is 24h, so no one expects an immediate answer when reaching via email.
But the pace of life is speeding up, and so does the communication. Being able to instantly respond can be the defining criterium – a customer would choose whether to wait an unknown amount of time for the response or start searching for another firm with a more responsive customer service.
As more and more people expect their issues to be solved in a jiffy, the best lead generation strategy for companies is to offer 1) self-service and 2) the ability to get the instant answers to requests. And how do the companies comply to these modern-day requirements?
In reality, an enormous number of companies have grave problems with this.
According to a study from Harvard Business Review:
5 min or less – ideal timeframe for responding to leads;
5-10 mins interval – a 10x drop in your odds of actually getting in touch with a lead;
10 mins and after – a 400% decrease in your odds of qualifying a lead.
Response time is a crucial factor for generating leads
And how quickly do most companies respond? A survey by Drift evaluated the response time of 433 companies, and got the following results – 55% of companies took longer than 5 days to respond. Unbelievable!
Usually all inbound communications are monitored and processed by a real person – Sales Manager, Marketer or a business owner themselves. A mere human could not serve hundreds of clients simultaneously, work 24/7/365, while responding in a matter of seconds. But a chatbot can. See more benefits of chatbots in this article.
Issue #2 – Connecting with younger generation
Let’s suppose you want your company prosper in the future as well as it does now, or even greater. Your future customers, without a doubt, would be different from those you have today. Therefore, today’s targeting techniques could not work for the clients of new generation. The youth live in digital media world. 1 out of 3 toddlers learn how to use a smartphone before they could walk or speak. Teens aged 8-18 spend as much as 9 hours a day on social media. And very soon they will grow up and become your the potential customers – by 2020, the people born after 1995 will account for 40% of all consumers.
These facts provide grounds to claim that business of the future is going to be tightly connected with modern technologies. Forward-looking companies would establish a solid online presence right now, and chatterbots could be another sufficient tool for that aim.
Issue #3 – Know our clients better
It is much easier to attract and target the person we know much about. Interestingly, that one common problem in business is knowing almost nothing about your current potential clients. So where can a company get data about their target audience in general and about the single client in particular? Chatbots can directly collect data from our client if the chatbot knows clients background by asking questions.
Approach 2: Drawing Analogies from trendy tech of the past
Although, analogy method is not a highly-reliable in this case, still it could provide some valuable insights.
Technologies that once made fuzz in tech world:
- 3D printing:
Remember time, when so many discussions and hopes were inflated around 3D-printing? Today, thought, it’s not that popular. But, judging by the statistics, it’s in demand and it develops step-by-step.
Each year, the number of 3D-printing apps continue to grow, even though they are no longer a hot discussion point for about the past 2-3 years.
(infographics – Sculpteo, The State of 3D Printing, 2018 Study)
- Artificial Intelligence:
Artificial Intelligence is still popular. But now the hype has slowed down a little. Even though, we use AI more than we even realize. While only 33% of consumers surveyed think they use AI-enabled technology, 77% actually use an AI-powered service / device – according to Pega. AI is becoming incorporated into a more diverse range of applications, and that trend is only going to accelerate. For example, now we have detect tumors, music and movies recommendation services – all AI-based.
From such a comparison, it becomes clear that a technology is not shrinking away when it is less talked about. On the contrary – they are applied more and more.
Approach 3: Exploring what stats say
We’ve pulled over the most interesting stats on chatbots to split the light over the question – are chatbots really useful for business?
- They already proved its efficiency for various companies like Starbucks, Lyft, Fandango, Spotify, Mastercard, Pizza Hut and so on.
- When answering the question: “Why would you consider asking a chatbot before engaging with a human?” nearly 70% of the responders claimed that they want instant answers to their questions (from a Ubisend questionnaire).
- In 2018, several companies (Drift, Salesforce and myclever) surveyed 1K+ adults in the USA, aged 18 to 64. Here is the graphics we’ve found most interesting:
Statistics speaks for itself – chatbot are indeed in demand.
Given all the above, most probably chatbots are an outstanding opportunity for businesses. But if they are so good, why still not everyone has one for their venture? Many companies mistakenly consider chatbot development unaffordable. Don’t be uninformed as well – get to know the real costs on the custom chatbot development.
Interested in chatbot development? Contact us, call us at +1 (973) 597-1000 or fill out the form below for a free consultation and estimate!