As consumers tighten their purse strings amid the cost of living crisis, competition for their custom is tougher than ever. Business owners are trying to do more with less – increasing sales while minimising spend and effort. So… where do chatbots come into this? we hear you ask.
When used correctly, chatbots can be an efficient and effective way to increase your sales without breaking the bank. While they might not have the charming persuasion of a top salesperson, they have their own benefits. As well as guiding customers through the marketing funnel, they add personality to your brand and offer that all-important accessibility and quick response that online shoppers increasingly expect from brands. They also collect key marketing data along the way.
While they aren’t a new business tool, the utilisation of chatbots has certainly gained momentum in the last few years, as an increasing number of businesses are wising up to their customer service and marketing benefits. In fact, it’s one of the fastest-growing technologies in the world. 1.4 billion people are using chatbots for sales, with the UK part of the top 5 chatbot-using countries (alongside the US, India, Germany and Brazil).
So, what exactly is a chatbot?
A chatbot is a computer program that uses artificial intelligence (AI) and natural language processing (NLP) to automatically engage with received messages, such as customer queries. They can be programmed to respond the same way each time, to respond differently to specific keywords and even use machine learning to adapt their responses based on situations. Chatbots leverage chat mediums such as website chat windows, SMS text and social messaging services (e.g. WhatsApp, Facebook) to receive and respond to messages.
You’ll likely have spotted chatbots on a number of different websites you visit, from e-commerce sites to online banking portals.
There are a wide range of AI chatbot platforms available, which usually contain tools to help you develop and customise suitable chatbots for your customer base (and some are even compatible with platforms such as Facebook and Instagram Messenger). You can find a number of useful comparison guides online but the best recommendation when shopping around is to make full use of any free trials available. This is the best way to know whether a platform is the right fit for you, your business and your customers.
How can chatbots help my small business?
In a number of ways! They can:
- Improve customer service by providing speedy and helpful responses
- Roll out 24/7 customer service at scale without employing more staff
- Boost sales by removing friction from the buying process
- Save you / your team significant time to focus on more complex customer service queries and other sales-driven activities
- Can deliver a big ROI with minimal financial outlay
- Allow customers to self-serve in the digital age
- Improve overall customer experience to encourage loyalty and repeat purchases, as well as positive reviews and referrals
- Allow companies to have meaningful engagements with their target audience
- Share offers and encourage sales with marketing messages
- Leverage AI to automate repetitive, manual tasks, freeing you up to focus on growing your business
- Gain insights to fuel personalisation efforts and spot sales opportunities
- (With multilingual chatbots), serve global markets effortlessly
- Boost bottom lines across several industries
- Cater to younger generations who are especially accustomed to using bots to buy products and services
- Make your website immediately more interactive
- And more!
Facebook has released a host of data that proves the value of bots for business:
- 2 billion messages are sent between people and businesses monthly
- 56% of people would rather message than call customer service
- 53% of people are more likely to shop with businesses they can message
- The majority of people who message businesses say that being able to message a business helps them feel more confident about the brand.
So, how can you use chatbots to increase your sales?
A chatbot can serve as a critical component of the sales funnel by delivering relevant info and answers at the most critical time of the buying journey: The decision-making stage. In fact, 36% of businesses use chatbots to generate more leads, and business leaders claim that on average, chatbots improve sales by 67%. So how exactly can you use chatbots to market your business and increase sales, without it feeling awkward? Let’s take a look…
1. Improve customer service, which is marketing in itself
Chatbots can help you shorten your customer service response times and increase customer satisfaction. This helps your business build a loyal customer base that can help generate revenue for years to come, not just through their own purchases, but by becoming a brand ambassador and recommending your business to others through reviews, word of mouth and social media.
By offering a 24/7 live chat option alongside other platforms where your target customers are present (e.g. social channels, text, email), you are meeting them where and how it’s most convenient for them. When customers feel heard and taken care of, they’re more likely to buy from you.
Some interesting stats:
Make sure to invest time in setting up your chatbot to be as tailored as possible towards your target audience. The more helpful it is, the better results for both parties.
2. Generate leads by gathering customer insights
By using conversational marketing to engage customers, you’re able to find out what they need help with, where they are in their buying journey, etc. Leads can be quickly qualified by chatbots before redirecting them to the appropriate next steps. For example, if you run an accountancy business, you could direct popular queries to the FAQ page on your website, or if a potential or existing customer would like to book a meeting with you, you could link to your online booking system to avoid time consuming back-and-forth email exchanges.
Chatbots can also ask visitors to provide their contact information, helping generate new lead data to go into your sales funnel. For example, (if the visitor opts in), they will receive marketing materials that could increase the chance of them converting further down the line.
3. Improve your offering by encouraging customer feedback
While AI chatbots can take a weight off your shoulders when it comes to customer service, it’s important to keep an eye on the conversations that are being had – are there specific issues that continue to crop up, which can be fed back into the business? Is something missing from your offering that your prospects are inquiring about? Leverage your chatbot data to further improve your offering and ensure the right team members are involved who can action change for the better.
You can also use chatbots to check in with and prompt customers for feedback, which they might not think to provide. Some customers might not want to provide lengthy answers, however chatbots can make the feedback process extremely simple. For example, they can ask customers to rank your business’s customer experience by selecting an emoji. Feedback can be given by the customer in just one click, which provides extremely valuable data that you can feed back into the business – positive or negative!
4. Answer frequently asked questions, freeing you up to focus on other sales-focused activities
By implementing a chatbot to handle repetitive customer service queries, you can free your time up to focus on other important areas of the business that can impact sales – whether it’s product development, website development or refining your social media strategy. If you have a salesperson/team, this will also free up their time to focus on high value queries.
All you have to do is arm chatbots with the answers to all your customers’ FAQs and let them handle these types of frequent queries. Customers will receive quick, clear responses, increasing the likelihood they will successfully move along the sales funnel. Leave humans to focus on trickier tasks that require empathy and a detailed understanding of peoples’ needs such as complaints and niche inquiries, and leave the basic FAQ-type responses to chatbots.
5. Provide a smooth, personalised shopping experience to encourage conversions
Bots offer far more value than merely answering routine FAQs. In fact, they can even act as a virtual assistant, proactively recommending products and alerting customers to new discounts, releases etc. For example, a customer tells a chatbot that they’re looking for a bike for their 6-year-old within a certain price range. Thanks to conversational AI, the chatbot can redirect them to their selection of bikes within this price range, while highlighting bikes that have recently been reduced, as well as popular ones amongst customers. This way, chatbots can help customers reduce their buying process down to just a few clicks.
Chatbots can also go one step further by upselling or cross-selling. For example, it can suggest to the customer that they might want to take a look at bike helmets, a puncture repair kit, etc – all tailored to their specific needs. Customers enjoy a smooth, personalised shopping experience while the likelihood of conversion is increased. It’s a win-win.
While humans can empathise with customers and build trust, that’s not to say the chatbots can’t. In fact, 67% of customers trust the personalised recommendations and suggestions provided through conversational AI interactions. Chatbots can automatically use visitors’ account information and past purchasing behaviours to instantly offer personalised recommendations – something a human can’t do at such a quick speed. They provide tailored assistance, saying the right thing at the right time, and leverage what they know about visitors to provide the most valuable buying experience possible.
Personalisation can have a drastic impact on sales, with 91% of consumers more likely to shop with brands that recognise who they are, remember what they want, and provide personalised recommendations. It’s no surprise that 90% of leading marketers say personalisation significantly impacts business profitability.
6. Reduce basket abandonment rates
There are many reasons why a website visitor might abandon their shopping basket before making their purchase. Where chatbots can help is by gathering their contact details and prompting an automated follow-up email encouraging them to continue checking out, or even remind them when they’re next on your website.
Is there any risk to using a chatbot?
We appreciate that the idea of chatbots can feel a little intimidating, especially when you’re someone who likes to be in control at all times. While some can feel a little freaked out by AI, the truth is – bots aren’t here to take over the world. They’re here to make life easier, for both customers and business owners.
As with most things, not all chatbots are equally as effective. It’s likely you’ll have had some negative experiences with poorly-programmed chatbots that send you in loops and leave you feeling frustrated and negative towards the business behind it. You might even have begun as a happy customer looking for a quick answer, but a poor chatbot experience could send you completely the other way towards a competitor. It’s therefore crucial you spend time researching and trialling the best chatbot solution for your business and your target customer.
There is definitely a generational divide when it comes to chatbot preferences. 20% of Gen Z consumers prefer to start their customer service experience with a chatbot, compared to only 4% of Boomers. You must keep your unique customer base in mind when developing your chatbot strategy.
Speaking of strategy, you will also need to have in place best practice guidelines that you / your team can refer to when handling difficult scenarios. For example, you / your sales team must keep in the loop of chatbot conversations in case escalation is required (some customers will refuse point blank to converse with a bot whatsoever). While chatbots are designed to work independently, make sure to keep an eye on them in case conversations go sour or a customer’s question isn’t being handled correctly.
Ensure you have in place a seamless bot-to-human handoff. Customers using chatbots should be able to transfer over to a human for more complicated issues such as payment disputes (34% of people use a chatbot as a means of getting connected with a human.) In those situations, ensuring the customer’s details and the chat history are passed to that human assistant is an important step so the customer doesn’t have to provide their details and the issue again.
Poorly designed chatbots with shallow knowledge bases and incorrect programming will create extremely poor user experiences and send your customers and prospects running for the hills. Assign chatbots straightforward, simple tasks and leave the more complex conversations to humans.
The Future of Chatbots
Consumers are becoming increasingly comfortable making purchases online via a chatbot conversation, with chatbot usage projected to soar even higher. By 2024, global consumer retail spend via chatbots will reach $142 billion, up from $2.8 billion in 2019 (according to Juniper Research).
You’ll likely have heard about ChatGPT in the news – another example of a prompting AI designed to solve or answer a question in a human-like manner. However, this is very different to anything we’ve seen before. It’s set to become part of our day-to-day lives, just like Google has. Designer and developer Adrian Twarog provides a helpful explainer video:
ChatGPT is the prime example of how much significant investment this sector has had in recent years. Completely free, it could make the process of marketing your small business better, faster and easier, helping to answer questions you have across a number of areas including product development, market research and keyword suggestions. Once industries take full advantage of it, it’s positioned to revolutionise so many industries.
Why not try it out for yourself?
As you can see, chatbots can be incredibly powerful and effective when used correctly. The most successful chatbots are the ones that fit your business and customer needs best, and have been utilised in the right way. Setting up requires time and attention, but the long term benefits are worth it. If you want to generate more leads and revenue through world-class customer experience, there’s no doubt that a chatbot can help you achieve just that – regardless of your industry, business size or model.
It’s a shame that the reputation of chatbots is somewhat tarnished by businesses that have utilised them poorly e.g. no human backup option. But the opportunity is there to implement them successfully, with many companies now calling chatbots ‘the future of customer service.’ Their ability to automate repetitive customer service tasks and improve customer experiences is a gamechanger, particularly for small businesses that might not have the opportunity to invest in a customer service and / or salesperson just yet.
As the data suggests – investing in chatbots and other similar social media messaging applications such as Facebook Messenger to ‘sweat the small stuff’, is a sound business move. It’s predicted that by 2027, chatbots will become the primary customer service channel for roughly a quarter of organisations.
It’s important to consider how you see your business implementing and benefiting from chatbot technology, both now and in the future. For many, the writing is on the wall – fail to invest in this technology and you risk being left behind, offering outdated customer service options and poor user experiences. There’s also the risk that your competitors will be enjoying the benefits before you do.
Businesses that invest time and resources into building a customer service strategy that effectively combines chatbots and humans will be the ones to deliver outstanding customer service. And as we well know, a happy customer is the gift that keeps on giving.
