Conversational commerce and the rise of the chatbot

When I was a kid I never had to call my friends. I’d come home from school and drop my books off at the apartment. Then, I’d head right back outside walk across the street and ring their bell or yell up to their window. Sometimes their mother would be leaning out the window, a cigarette in her left hand, a rotary phone gripped in her right. She’d see me and wave. And then yell. A few moments later my friend would step out onto the thick concrete steps of a New York City stoop, and we’d play till the sung hung low in the sky.

Nobody communicates like this anymore. At least I don’t. Maybe it’s because I’m a little bit further away. My friends don’t live across the street anymore. More and more however, I find myself less willing to even call them up when a text message will do. And it’s not just me. Text messaging is the most widely used application on smartphones today, with 80% of adults making use of the service. Messaging has changed our conception of social etiquette, and even changed our behavior (think of all those “Look Up” warnings sprayed on the asphalt of busy intersections.) Messaging, beyond transforming our social interactions, is also transforming our professional ones as well. Enter the chatbot.

A chatbot is a service that users can interact with in very much the same way they would conduct a chat with another the person. The only difference is that the interaction is carried out through a messaging interface with a set of rules or artificial intelligence dictating the chatbot’s response to a user’s questions. Quite simply they are an intuitive and socially inspired way to automate a variety of services and they are appealing for the same reasons that text messaging is appealing: they get to the point efficiently.

We’ve probably all had the onerous experience of being on the phone with those voice automated services, having to repeat ourselves numerous times only to finally be directed to a representative. With the digital transformation well underway, companies are automating and virtualizing different aspects of their businesses. Using a chatbot is a much more efficient way to automate services, allowing users to access them from anywhere without having to worry about background noise or rudely jabbering away in public.

The services that can be automated using a chatbot vary. Magazine and newspaper companies might use a chatbot to assist in renewing customer subscriptions or reaching new customers. Another service that can be automated is online shopping. The chatbot acts as a virtual salesperson and directs users to exactly the items that they are interested in rather than having them browse around. In this respect Amazon Echo’s Alexa functions somewhat similarly.

On a larger scale however, we have China’s chatbot service called WeChat. WeChat is a cross platform-messaging service, but it’s also much more. With WeChat, users can message and procure a variety of services, from food delivery to hailing a taxi. Users that provide banking information can also use the application to pay bills or transfer money. This business model has been dubbed conversational commerce. It allows customers to communicate directly with businesses in order to procure a variety of different services directly from a messaging app; think Facebook Messenger’s Uber integration. Chatbots make up the heart of conversational commerce.

Currently, there exist two types of chatbot: those who operate based around a set of rules, giving them limited functionality, and those that operate on machine learning. The latter type can learn from interaction with customers. With the emergence of conversational commerce, companies such as exClone are coming up with algorithms that better replicate human expertise and impart it onto chatbots. This more advanced artificial intelligence increases chatbot functionality and allows them be used more effectively across different industries.

Beyond just helping your business enter the conversational commerce arena, chatbots can help business owners go about the work of digitizing in a cost effective manner. They also represent the point at which artificial Intelligence and human intelligence converge. While algorithms like exClone’s enable high functioning chatbots to be deployed en mass, they must still pattern themselves on a human persona and expertise. To ensure optimal efficiency, chatbots should be deployed alongside workers in order to amplify the human element rather than replace it completely.

And while some may lament this convergence, of the slow disintegration of the boundary between the physical and the digital; it can be argued that technology’s capacity to improve the quality of our lives is intrinsically tied to its capacity to change them. It may seem like as our lives grow more convenient they grow more impersonal, but the depth of the connection is something that is entirely up to us. The fact that there is less limiting us in making those connections is something to celebrate. But let’s be honest: when was the last time you made a deep and moving connection with your banks customer service rep? Yeah, bring on the bots.

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