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Shopping is a highly personal activity for most. Some require the touch and feel of the products they are buying while others are on a hunt for saving a few bucks on discount. Some may have questions about the product. What are the color options available? Are there any discounts on selected products? Any other product recommendations? In case of brick and mortar stores, a sales rep can quickly respond and provide satisfactory responses. In case of online shopping, chatbots fill in the gap. In fact, 52% of consumers are more likely to make repeat purchases if the company offers support via live chat (Kayako). 

Chatbots are no longer automated responses to most common questions asked by a visitor on your website. They have evolved to become a full-fledged conversational marketing tool that can help a visitor achieve their goals purely through intelligent responses. Let us understand chatbots better and learn how it can become every shopper’s handy assistant.

Concept of Chatbots

In simple terms, chatbots are a digital simulation of human interaction where one of the parties is an AI that continues the conversation based on a flow chart. In case of e-commerce chatbots, it helps the buyer in

  •  Completing their purchase
  •  Recommending similar products
  •  Provide customer support

For a business owner, a chatbot adds another layer of customer interaction that only allows relevant queries to be forwarded to customer service agents, while answering most of the commonly asked questions by self. According to Gartner, the implementation of chatbots in institutions reduces about 70% of calls and emails from Customer Service. This saves time and money in the longer run.

How do Chatbots work?

While the concept is same, a chatbot can implement any of the following logic methods to work efficiently:

  •  Rule-based
  •  AI enabled
  •  Hybrid (AI determines the rules)

Rule Based

This chatbot operates in a completely straightforward manner. You need to feed pre-set rules into the system and the bot provides information provided against every condition. The system follows a flowchart of user interactions available beforehand and only responds to user inputs that match any of the conditions mentioned. One such rule set is as shown below:

Chatbot

However, you can include a ‘Transfer to agent” option for queries not available in the bot’s library to ensure the communication is not dropped. While not smart enough to convert leads on its own, rule base chatbots are faster to deploy and easy to train. You are in more control of the direction the conversation will take. For businesses on a budget, a rule-based chatbot is the way to go.

AI enabled

AI enabled chatbots are complex logic that constantly evolves based on the interactions it has. It uses machine learning to ‘understand’ and interpret the query intent. It is superior to the Rule based chatbots when it comes to crafting a conversational tone with the visitor. Paired with a recommendation engine, it can study the user behavior and provide upselling or cross-selling opportunities.

How it works is that when the user enters a query, it is sent to the Natural Language Processing Unit that compares the query against a pre-set knowledge base as well as past interaction history. On a successful hit, the unit sends the response back to the user and based on the future interactions, the unit registers new responses.

chatbot work flow

Hybrid

As the name suggests, a hybrid Chatbot uses pre-set rules to respond to the user query and any new interactions are registered for future interactions. You can consider this to be a middle ground between the two aforementioned chatbot logics.

Why Should You Use an eCommerce Chatbot?

By 2024, consumer retail spends via chatbots worldwide is projected to reach $142 billion, i.e.,  ~4971% increase from 2019 ($2.8 billion) (Source: Juniper Research) Implementing a chatbot has benefits for the consumer and the brand as well. Here are some reasons why you should consider an eCommerce chatbot.

Helps customers search faster

When shopping online, people expect to reach their destination with minimal distractions. Any delay of precious seconds would result in them going to the competition. Deploying a chatbot ensures timely assistance to your customers. Instead of having the customer browse through innumerous categories and sections, your customers can directly put in their search query in the chatbot and receive links to the corresponding product. Moreover, the chatbot can fetch product information, shipping details from the backend to provide the right answers, at the right time, on the right platform.

Offer Quick Post Sale Issue Resolution

Sometimes the payment doesn’t pass or the order is not placed even after payment. In such cases, quick resolution of payment failures/return or refund are pressing concerns that need to be addressed promptly. Thankfully, chatbots can make use of automated workflows to pull information about return, refund, payment, billing, order confirmations, and shipping and offer quick issue resolution.

Understand query intent and generate sales

Certain queries may have an intent to purchase. The key lies in understanding the intent and providing solutions to such queries with a sale in mind. The chatbot can provide answers and then follow up with the option to either place the item in the cart or take the user to the order page. Similarly, chatbot can be integrated with other communication channels such as email or SMS to notify the customer about stock availability and reorder requests periodically.

Save money on customer service

The time invested by an agent in understanding the issue and providing solutions can be cut short by implementing a chatbot. Moreover, the most commonly faced issues can be handled by the chatbot, leaving the agent free to tackle complex issues. This severely reduce request downtime and improves customer service quality.

Round the clock personalized service

Since chatbots are automated services, they can answer queries at non-business hours as well without compromising on the communication quality. This is very useful when you provide service on multiple geographical locations and don’t need to have a resource on-call the whole time. Moreover, chatbots can tap into existing user preferences to provide personalized suggestions based on past purchases.

Things to look for in a chatbot

Custom Knowledge Base

A chatbot heavily relies on a robust knowledge base to fetch information and present it to the visitor. While all chatbots offer an editable knowledge base, it is important to learn the behind the scenes capabilities to understand the limits of the chatbots.

Supports 3rd Party Integration

For fetching customer information or shipping details, your chatbot needs to ‘talk’ to your CRM or any other tools. This is only possible if the chatbot supports 3rd party integrations or provides ways to manually integrate them.

Easy Workflow builder

For a rule-based chatbot, it’s workflow is the brains behind the operations. However, some chatbots have a complex workflow builder that offers in-depth customization but demands coding or technical knowledge. This may not be suitable for everyone and you need to find one that has a easy to use workflow builder interface.

Provides in-depth reporting

To improve the performance of your chatbot, you’ll need analytics and reporting. A good chatbot solution will provide detailed reports that you may use to measure and improve the productivity of your chatbot.

Cost-effective

Chatbot technology is expensive, especially AI backed chatbots. While the cost is recovered by the increase in conversions and ROI generated, you don’t need a chatbot that breaks the bank.

Wrapping Up

Chatbots’ potential is undeniable, and organizations can increase customer retention, acquisition, and loyalty by investing in chatbot technology. There’s a good probability that chatbots can help you achieve your customer service goals, whether it’s cutting expenses, boosting KPIs like ticket deflection rate, response and resolution times, or increasing agent productivity. Our eCommerce development experts can certainly assist you if you’re wanting to implement an eCommerce chatbot in your online store.
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