Chatbots are artificial intelligence systems that interact with users through texting, messaging, or speech. These are widely used nowadays in diverse areas ranging from health and finance to banking and finance. Here, these perform communicative functions in segments such as service, processing, payments, and marketing.
The number of chatbots used across the web has increased drastically over the past few years, and more and more firms are turning to it with each passing day. Digital marketing trends forecast that by the end of 2020, 80% of firms will be using these. This is because, by automating customer support services, firms save a lot of resources and time. However, there are also some disadvantages to using chatbots.
Here is a list of the outstanding benefits of using chatbots.
- Reduce Operational Costs
Ecommerce businesses spend a significant amount on answering customer requests. For, they need to hire customer-care staff, train them, and pay them. The statistics report by Chatbots Life says that chatbots can cut a firm’s operational expenses by up to 30%.
- Save Time
Chatbots are designed to answer customer queries by accessing big data. Their smart algorithms and programs allow them to process data more precisely. It saves a lot of time, which could be put to more productive use. For instance, in hiring from a large number of applicants, bots can be appointed to narrow down the candidates by asking relevant questions.
- Zero Error
Unlike human beings, Chatbots do not tend to forget things. So, the likelihood of those making an error becomes zero. And your customers will be more satisfied with the speedy service and apt answers. Thus, firms can outsource certain tasks of humans to bots. And the staff that would otherwise be appointed for customer service related tasks can be assigned some other important tasks.
- Round- the- clock service
Chatbots can be used for providing customer service through your website 24 hours per day throughout the year. These won’t take holidays, weekends, sick days off, and vacations. So, when customers visit your site, they need not wait for a human to attend them. They can get their answers by themselves by asking your bot.
So, having a chatbot installed at your site is one of the best customer retention strategies. Statistics say that 64% of internet users agree that the best feature of chatbots is their 24-hour service.
- Increased conversion
Statistics state that 37% of internet users use a customer service bot to get replies to their queries in emergencies. Having chatbots on your site can increase your website conversion rate via answering queries quickly and accurately. You can get more ideas to increase conversions with a conversion rate beginner guide.
- Reduced user frustrations
Knowledge bases can often be overwhelmingly vast and heavy for users to solve their queries. This can be solved by using chatbots. These can deal with voluminous traffic and still provide valid support. Further, these also ensure good user experience and satisfaction. So, these significantly reduce user frustrations.
- Identifying highly potential leads
Your firm’s main goal of generating numerous leads and turning them into customers can be accomplished by employing chatbots. With the use of advanced qualification logic, you can get your chatbots to provide you with qualified leads. This, in turn, can quicken your sales.
- Keeping up with the trends
A vast majority of internet users prefer interacting with brands through chatting. This is because it is faster and easier. So, by having chatbots, you not only stay abreast of today’s trends but also get to reach more customers.
- Increased customer engagement
Studies say that brands that keep their customers engaged with them can make higher sales. Having chatbots at your website and integrating your chatbot into a popular social media platform can interactively engage your customers, and thereby, drive sales.
- Improved customer service
Chatbots can improve your customer service in multiple ways. The foremost way is by being a real-time sales assistant to providing your customers with the needed support during their shopping. For 83% of online shoppers need their queries related to payment, delivery, checkout, etc. answered while shopping.
Further, as mentioned earlier, these offer such support 24/7 without any customer having to wait for their turn. And yet another way in which these enhance customer service is, by initiating a conversation with each customer at any time and regarding any issue. This improves the way they perceive your brand.
With the advantages of chatbots exceeding their technical glitches, chatbots are the current trends, which are also expected to stay for a long while. So, businesses are increasingly adopting these for various purposes.
With large databases and extensive training, highly conversational and context-aware chatbots can be developed nowadays. These can even recall customer behavior and related things from past conversations and use those insights to respond to customer queries in the right way.
Additionally, you can organize and enrich your knowledge base to be bot-friendly. This will enable your bot to expertly scan the content and extract apt solutions for every customer request. You can also prime it to converse with your clients in the right manner. If necessary, you may also consider programming it to respond with emotions.
Certain good bot building solutions over the net allow you to build your bot without any programming knowledge. So, you become empowered to easily build a chatbot and use artificial intelligence to match the conversational flow.
Demerits of Chatbots
Today’s technical capabilities aren’t enough to develop a Chatbot that can handle complex requests. No chatbot has ever accomplished 100 percent recognition. So, here are a few demerits of chatbots.
Chatbots are not thoroughly secure. Through their interface, these can let in hackers to access your firm’s network, user’s data, databases, and applications. So, firms using chatbots should consider factors like the time-duration and how information is stored, how it gets used, and who has access to it. It is particularly important for those sectors dealing with sensitive client information, such as banking and finance.
- Programmed for limited responses
Chatbots work on limited databases, and hence have limited responses to customers. So, not all customers will get their queries answered through these. Further, since these cannot always completely understand what is asked for, conversations may run in a circle, thus frustrating users. If you went for a sophisticated chatbot with an extensive database, the setup cost would be quite high.
- Inability to Make Decisions
Chatbots cannot make decisions like how we humans do. If your knowledge base doesn’t include answers to a customer’s query, your chatbot may not address the concern presented by him or her. So, you need to organize and enrich your knowledge base such that it is bot-friendly. It will enable your bot to expertly scan the content and extract apt solutions for every customer request. Further, you also need to prime it to converse with your clients in the right manner.
- Lack of emotions
Emotions are needed to converse in the right way. However, unlike humans, bots lack emotions and can be extremely mechanical. Only if the conversation flow goes by the path specified, these can handle customer requests based on pre-programmed conversations. But if the conversation takes an unexpected turn, these may get bewildered and may not be able to provide the answers. And as these do not have emotions and feelings, these cannot constructively communicate with humans in some instances.
But no matter what their demerits are, chatbots are increasingly opted for by businesses and organizations worldwide. It is because their advantages outweigh their disadvantages.
Thus, chatbots certainly are a boon and not a bane. Here are some statistics that indicate that chatbots are looked upon favorably by a huge population.
- WhatsApp’s chatbot is a leading chatbot used, particularly for business purposes. Over 80% of small businesses in India and Brazil say that using Whatsapp for business facilitates their business growth and customer service (Sprout Social).
- The top five chatbot using counties are the United States of America, India, Germany, the United Kingdom, and Brazil (Chatbots Life).
- In 2018, Blue-Bot, a Facebook Messenger chatbot, sent two million messages to over 500,000 customers (Convince & Convert).
- In 2018, more than 300,000 chatbots were on Facebook (Venture Beat).
- Firms with the number of employees between one and fifty use chatbots more than others (Think Relay).
- 50% of businesses have allocated a higher budget for chatbots than for mobile apps (Chatbots Life).
- The most profitable sector for chatbots is the real estate industry (Chatbots Magazine).
- About 40% of people from all age groups favor using chatbots while shopping online (Tidio).
- 78% of females prefer chatbots while shopping online, and 92% of males use these when they are unable to find answers to simple questions (Tidio).
- By the end of 2020, chatbots will be used by 80% of entrepreneurs (Chatbots Magazine).
- By the end of 2020, 56% of people would prefer chatting with a chatbot over conversing with a human agent or waiting for a long time to get replies.
- By 2021, an investment of $5 billion will be made in chatbots (Chatbots Magazine).
- By 2021, 85% of customer interaction will be handled by artificial intelligence (Chatbots Life).
- By 2022, bank systems will use chatbots to automate a major part (90%) of customer interactions (Chatbots Magazine).
- By the end of 2023, firms worldwide will save 2.5 billion customer service hours by employing chatbots. And the associated cost reduction across the healthcare, banking, and retail sectors is estimated to account for $11 billion (Chatbots Life).
Thus, the current trends and future predictions, forecast a period of more extensive chatbot usage. These conversational agents, which are still at their nascent stage, are anticipated to experience an impressive enhancement with further technological advancements. Their rising popularity is also expected to widen their horizons across numerous business sectors.