How eCommerce chatbots can boost sales and customer retention

Here is a frightening scenario for business owners in the modern world – type the words ‘is customer service dying’ into Google and, in less than half a second, you will find yourself looking at a screen offering access to more than 40 million articles, forums and sites. Now that may be excellent customer service by the search engine – you asked, they over-delivered – but it is a stark reminder that in a world where consumers want things faster and cheaper than ever, many businesses are prioritizing the short-term buzz of speed and convenience over the benefits of good, old-fashioned customer service.

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This is particularly so in the booming eCommerce sector where ambitious entrepreneurs are revolutionizing the way people buy and sell goods and services. For too long, online shoppers have essentially been left to their own devices when entering a virtual shop front, free to click here and click there, and as they wander aimlessly they become an increasing risk of leaving without making a purchase. Compare this to a traditional brick-and-mortar store where friendly and knowledgeable staff can greet a new customer and guide them towards the products or services they are looking to buy … and maybe even a couple that were not on their list.

The good news for eCommerce executives is that fast-evolving technology is allowing them to change the game. The lack of a physical retail assistant no longer needs to be a barrier to great eCommerce customer service and that is because online stores can now employ a team of super-friendly, always-on-call, highly knowledgeable experts ready to guide people towards products, services and, ultimately, the shopping cart.

Welcome to the game-changing world of eCommerce chatbots and conversational AI.

What is an eCommerce chatbot?

eCommerce chatbots are artificially intelligent (AI) solutions that online retailers can develop and deploy to engage customers throughout the entire consumer journey. From conversational marketing and answering queries to providing quality after-sales support, they are the ideal tool to improve customer experience without needing to use human agents.

Crucially, the focus of this article is on the modern generation of chatbots. While the traditional ‘scripted’ variety can be programmed to respond in pre-defined ways to specific questions, they fail when presented with a complex query or one not envisaged by the developers. Fortunately, technology has evolved to find a solution that is literally changing the face of the eCommerce experience.

Enter AI chatbots for eCommerce.

What is Conversational AI?

Conversational AI is the set of technologies that enables computers to simulate real conversations. Where traditional chatbots can respond to a limited set of simple queries, virtual agents or AI chatbots are powered by a ‘synthetic brain’ made up of different technologies working in unison to enable a machine to understand, process and respond to human language.

For an intimate understanding of the mechanics of conversational AI, search online for terms such as ‘Natural Language Processing’, ‘Machine Learning’ and ‘Predictive Analytics’. These are the features and components that enable chatbots to deliver a more dynamic, less constrained user experience.

For a practical example of conversational AI though, think of the likes of Siri and Google Home, which are making life easier for millions of people across the world. The rising popularity of such digital assistants and smart speakers are powered by conversational AI and rising in popularity so quickly that is predicting the global chatbot market will almost quadruple from $2.6 billion in 2019 to an incredible $9.4 billion in 2024.

Why do eCommerce businesses need chatbots?

At a time when people are debating whether customer service is dying, it’s somewhat ironic that customer experience (CX) has never been more crucial. Studies have shown CX now ranks higher than price and product for consumers, with the ability of businesses to attract and retain customers increasingly tied to whether they are able to provide them with a seamless and enjoyable shopping experience.

In many ways, this is even more important for eCommerce businesses given the highly competitive sector in which they operate. With up to 24 million eCommerce sites only a click away, there are endless options for shoppers and staying ahead of the game requires businesses to provide a level of service that helps them stand out from the crowd.

The modern online shopper wants to access information and resolve issues as quickly as possible and without being directed to pick up a phone. Many also welcome an automated guided hand when browsing a retail site. They want to see customer service thrive, not die, and eCommerce chatbots are allowing that to happen.

What are the benefits of eCommerce chatbots?

There was a time when some businesses reluctantly adopted chatbots as they felt pressure to demonstrate how tech-savvy they were. No more. Today’s eCommerce chatbots offer such a wide variety of benefits that looking good is the least of a business’s worries.

  • Personalization: like a small-town shop assistant, eCommerce chatbots have a remarkable ability to remember crucial information about the people who wander into their online stores. From a shopper’s preferences and habits to their purchasing history, they are designed to gather data about individual customers and, importantly, use that information to deliver them with a personalized experience. This not only boosts engagement rate but also saves customers’ time by guiding them down the sales funnel. One of the keys to offering a premium customer experience is an intimate understanding of one’s customers and eCommerce chatbots are taking that knowledge to the next level.
  • Recommendations: where eCommerce pioneers faced the challenge of operating in an environment that lacked a two-way dialogue with customers, conversational AI has rewritten the rules. Modern chatbots converse with shoppers, bouncing questions and answers back and forth in a friendly tone that makes shoppers feel comfortable and creates an atmosphere in which people are open to product recommendations. This is crucial given personalization drives impulse purchases, with one study finding almost 50% of people have purchased items they did not initially intend to buy after a personalized recommendation from a brand, while 40% of U.S. consumers have purchased a more expensive item for the same reason.
  • Fast resolutions: the technology powering chatbots has evolved to such an extent that they are able to start searching for answers to inquiries before customers have even finished typing their questions. AI allows chatbots to access knowledge bases and FAQs based on keyword identification, with the hunt for answers increasingly efficient and accurate. This capacity to resolve such inquiries faster than ever cannot be understated given how much customers appreciate a seamless and speedy response when engaging with an eCommerce store.
  • 24/7 support: eCommerce businesses that believe they can survive without offering instant support are in for a rude shock. According to one study, more than 50% of today’s customers expect businesses to be open 24/7 and online providers that try to buck the trend do so at their peril because competitors will be providing around-the-clock support. Society is adhering less and less to traditional business hours and chatbots allow organizations to engage with customers and provide instant solutions 24 hours a day, 365 days a year without lengthy waiting times and the expense of employing live agents.
  • Conversion rates: one of the great frustrations for eCommerce retailers is customers clicking away from their shopping carts. With the current online shopping cart abandonment rate sitting at almost 70%, every effort should be made to reduce such churn and chatbots can play a pivotal role in doing just that. A common cause of cart abandonment is customers going elsewhere when they hit roadblocks on a website, with Forrester finding 53% of online shoppers abandon their carts if they do not receive instant answers to their questions. They do not want to be told to make a phone call or send an email. They want immediate access to information and chatbots can help them achieve that. Furthermore, automation technology means chatbots can ‘speak up’ and prompt a customer into action when their shopping cart has sat idle for a certain period.

How to make eCommerce chatbots a reality?

For businesses yet to deploy an eCommerce chatbot, it should not be a matter of if but when. That said, it is also a process that should not be rushed. Among many considerations, it is crucial to pick a solution that will meet one’s current goals but not limit future expansion and also ensure one has a true understanding of how the use of conversational AI will impact customer experience.

The technology driving eCommerce chatbots is constantly improving and while there are cookie-cutter options on the market, it is highly recommended for businesses to partner with a team that can deliver the best solution for their individual needs. Tapping into the knowledge and expertise of a quality eCommerce outsourcing provider is a fast-track to developing and deploying the best AI chatbot for one’s specific situation and helping nurture a better online environment for their customers, their staff and, ultimately, their bottom line.

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