Some estimates state that 80% of all companies will use chatbots to generate leads or build customer loyalty in the next few years. How does this, and how should this, affect social enterprises?
First, what is a chatbot? It is an automated “instant message” discussion that “pops up” on a website or social media platform to engage the potential customer with either a text or voice conversation. The goal of a chatbot is to mimic genuine human interaction through clever writing and the use of artificial intelligence. In some cases sophisticated algorithms combined with user data ensure the outputs are as personalized as possible, only more efficient.
Chatbots typically start with an open question, such as “How can I help you today?” Users who choose to engage will often ask a question that can be answered by one of perhaps hundreds of pre-programmed responses (Chatbots, then become a customer service robot that can access an almost infinite number of responses in a Frequently Asked Questions database). As the “conversation” proceeds, the bot typically will request a prospect/customer’s name and email address and remarkably, statistics show that the majority of site visitors will actually provide that information (which is very hard to get via other customer development tools and activities).
Chatbots are counter intuitive to many marketing professionals, and to social change entrepreneurs. They challenge the notion that personal interaction is one of the most effective ways to generate leads, build loyalty, and engage customers. The thought that artificial intelligence can do this work for social enterprise may feel, somehow…wrong. Duplicitous even.
However, chatbots are tireless workers who never need time off, can respond to thousands of interactions simultaneously, and can create new leads from browsing users, effectively deliver key messages or marketing promotions, and can, in fact, answer the majority of basic questions. Websites are static, whereas chatbots create the illusion of dynamic interaction. If a user wants to find out the store’s opening hours on the long weekend, they can choose to find that information on what might be thousands of pages on the website…or they can simply ask the chatbot and have a response in seconds. However, it is important to recognize that chatbots should not compensate for bad web design, they should augment an easily navigated website.
There are some downsides, of course. Estimates suggest that the programming and technology required to create an effective chatbot can cost $20-$30K. This is a lot for an early stage business, and it may be difficult to justify without concrete proof that it will help bolster sales and the customer relationship. Investing in a chatbot, fundamentally requires a leap of faith, and it can also diminish (or deplete) available funds for other forms of marketing. It is not surprising that the relatively simple-to-use chatbot plugin for Facebook has become common. From the 2016 launch to mid-2018, there were over 300,000 active chatbots on Facebook.
Also, chatbots need to be able to pass the (prospective) customer to a live agent if the customer becomes frustrated, or if they are not getting the information they need. It is often difficult for small businesses to make this transition from bot to human interaction seamless. A bot can book an appointment with a customer representative, but there is often a few hours delay (or more) and this means that the “lead” might grow cold or even find an alternative product online.
So, is a chatbot the right thing for a social enterprise? In truth, chatbots are becoming the norm on many commercial websites, and in the last few years, online users appear to be embracing them as useful tools to help them access information on a company or its products. However, chatbots are most useful only if your customers embrace them and only if they work well. They can be particularly effective for businesses that have high web traffic, and in cases were simple responses are all that is needed in most circumstances. If your business sells a toy that has specifications that are important to share (are they recyclable, for example) that is an easy question to answer. However, if your business is selling facilitation services, then answering a prospective client in person might be a better way to convey your value.
Social Delta has been surprised at the statistics on the effectiveness of chatbots, and therefore advises that they not be dismissed as a tool in the marketing toolbox; however, as with all marketing tools, chatbots should be evaluated by the social entrepreneur by considering their value to the business. They should strategically employ the technology if there is an expectation of benefit (financial or mission impact) that exceeds the cost (money or time or reputation).
However, social entrepreneurs should not presume the tool to be invasive or annoying; somewhat remarkably, the studies show chatbots to be a strong customer cultivation tool in many cases.