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Trusted Customer Engagements Through Chatbots

Chatbot encounters have become a normal state of affairs in cyberspace be it online or mobile and many consumers, especially millennials, are not only used to it but are also putting their trust in the technology.

As computer programs, chatbots simulate conversations using Artificial Intelligence (AI). Chatbots are basically intended to improve customer engagement through fast response to inquiries at any given time, and for entertainment purposes also. A number of publications have declared that the "chatbot revolution" is already happening and it is even predicted to replace or outdo mobile app development.

Forbes noted that chatbots are likely something you’ve already encountered before, whether you realized you were dealing with AI or not. If you’ve seen one of those popups on the bottom right of the screen when you first visit a website asking if you have any questions, you’ve encountered a chatbot.

Chatbots are touted to replace or outpace mobile app development. Statistics showed the top industries profiting from chatbots are real estate, travel, education, healthcare, and finance.

There are over 300,000 chatbots on Facebook, over 5 billion monthly active users of messaging apps, 40% of millennials chat with chatbots on a daily basis, and that live chat software has a 73% satisfaction rate as a way for customers to interact with businesses.

Gartner predicted that in 2020, 85% of customer interactions will be handled without a human agent; and in 2021, 50% of enterprises will spend more on chatbots than mobile apps. Juniper Research forecasted that in 2022, $8 billion in cost savings will be realized from the use of chatbot conversations; and in 2023 a total of 2.5 billion hours will be saved by businesses and consumers combined. Meanwhile, Global Market Insights foresees the overall market size for chatbots in the world to reach $1.3 billion in 2024.

Newstrail presented that besides AI development, chatbot market growth is also driven by the increasing demand for intelligent customer engagement, the need to understand customer behavior and increased penetration of websites and mobile applications.

The tech news portal added web-based segment continues to be the dominant player, however, the adoption of software among banking and financial institutions has led to their domination within the overall market. This is fueled by the need of the BFSI sector to improve customer relationship management (CRM) and the advantage which chatbots offer as a wonderful customer support system.

Featured below are topics about trusted customer engagement with chatbots, chatbot types, and how chatbots are replacing the need for mobile app development.

Chatbot Types

Not all chatbots are created equal. Chatbots Life explained in an article there are two distinct types of chatbots, namely, transactional and conversational chatbots.

Transactional chatbots are used mostly for business purposes. They are capable of storing and retrieving data related to a certain company, for different functionalities. They should be able to keep track of the current context and reply accordingly, which means more processing is needed.

One of the recent historical transactional chatbots launched was MARVIE (short for “Most Awesome and Resourceful Virtual Intern Ever”) by Singapore-based budget carrier Scoot. Marvie is Asia’s first transactional chatbot which lets customers book and pay for flights via credit card right on Facebook Messenger.

Ever since MARVIE landed on Facebook, the airline has seen its Messenger queries more than triple from 50 to over 1,750 a day. Among the first flights it booked were for family groups and took about seven minutes to complete. Other airlines that allow Messenger bookings via chatbot are Iceland Air and Transavia, while Lufthansa’s bot helps passengers rebook during canceled or missed flights only. Transavia also announced it’s working to let customers book flights over Whatsapp.

Meanwhile, conversational chatbots are responsible for having a conversation with the user. These types of chatbots are used especially for entertainment purposes.

Chatbots Magazine in 2017 featured seven chatbots it rated as "intelligent", and three of them are Mitsuku, Right Click, and Poncho. The online magazine noted a chatbot is intelligent when it becomes aware of user needs. Its intelligence is what gives the chatbot the ability to handle any scenario of a conversation with ease.

Topping Chatbot Magazine's list was Mitsuku, an AI chatbot which won the Loebner Prize, an annual competition in artificial intelligence that awards prizes to the chatterbot considered by the judges to be the most human-like. Mitsuku is designed to chat about anything, which is one of the main reasons that make it so human-like — contrary to other chatbots that are made for a specific task.

Right Click, meanwhile, is a startup that introduced an AI-powered chatbot that creates websites. It asks general questions during the conversation like “What industry you belong to?” and “Why do you want to make a website?” and creates customized templates as per the given answers.

The Insomno bot, as the name suggests, is for night owls or for all people out there who have trouble sleeping. This bot talks to you when you have no one around and gives you amazing replies so that you won’t get bored. It’s not something that will help you count stars when you can’t sleep or help you with reading suggestions, but this bot talks to you about anything.

Commenting on Microsoft CEO Satya Nadella's vision of "conversation as a platform", Biz Carson of Business Insider wrote that chatbots could change everything about how you surf the web. In the future, you could just say "I wonder if it will rain today" and a chatbot would know your location and be able to answer conversationally whether you should bring an umbrella. No apps. No search box.

Trust in Chatbots

In a survey conducted by Userlike, the overall result showed chatbots are making a good impression. People trust chatbots with basic requests. Respondents are willing to chat with a bot for simple inquiries (product specifications, order status, shipping).

As to how much do people trust chatbots, the survey showed at least 36% of respondents would use a chatbot to pay a bill and 41% would use it to check an order status.

People also perceive chatbots as innovative rather than cheap.

Chatbots have the potential to strongly reduce service costs, making things cheaper for the company but that doesn't seem to reflect negatively on the company.

However, based on the Voxpro CX Index, which polled 1,000 US consumers last year, consumers still want human-to-human interactions when engaging with brands for a variety of needs, from purchases to service requests to sharing feedback on positive and negative experiences. Additionally, consumer trust in sharing personal data with brands still teeters on the fence between acceptance and discomfort.

Voxpro reported 21% of consumers trust brands with their personal information; 45% don’t want brands storing their information due to concern over data breaches or hacks, and 14 of consumers have never shared their personal information with a brand.

Voxpro chief commercial officer Brian Hannon explained that when it comes to customer experience in retail, these findings show that success in reaching consumers centers on striking the right balance between technology and human interaction.

"The human touch is still a highly valued tool for brands to drive positive customer experiences, with consumers still gravitating towards live agents to handle more complicated requests and service needs. Retailers need to focus their efforts on a balanced approach that incorporates technology into their service offerings, and plan for how that technology works to support their human agents," Hannon said.

He added retail brands need to be more transparent about how they're using, storing and sharing customer data.

In the same view, Michael D. Mills, SVP, Global BPO Solutions, Contact Center division, CGS, said the improvement in chatbot technologies has been rapid, but the technology alone is not sufficient.

"In customer support services, we all need to be more cognizant of consumers’ privacy and the local compliance requirements, making it the forefront of the business. As governments continue to address data security and privacy concerns, all industries need to ensure they are prepared for the regulatory needs of today and the future," Mills said.

Forbes contributor David A. Teich suggested that companies should take are two-fold. First, a much better job must be done to improve basic data security and to advertise that security. Second, marketing needs to be done alongside the rapid rollout of chatbots.

"There needs to be a mindset that the chats need to start by making it clear that the goal is to provide rapid service while also reinforcing security," Teich wrote. "Over the next 18-24 months, that dual goal should display itself by having the chatbot give an option to put people in touch with a live operator if personal information is required. Alongside that process, the company should be visibly improving data security while marketing nudges consumers in the direction of choosing, on their own, to provide more information to improved systems."

Chatbots Outpacing App Development

Availability, speed, simplicity, easy development, storage issues, app fatigue. These are some of the main reasons why chatbots are touted to replace the need for further app development.

As early as 2016, symptoms of app fatigue became clear in a

report by Nomura Research, seeing a 20% decline in app downloads for 15 leading app publishers in the US for the month of May 2016 as compared to the previous year.

Simply put, there are just too many apps out there, it takes time to download them, they eat up storage space in your devices, and you're inclined to adjust to different user interfaces. All these hurdles are not issues in using chatbots since they are available within major messaging apps (where you probably already are) such as Facebook Messenger, WhatsApp, WeChat, among others, and so there is no need to keep downloading for apps and inputting the same personal and credit card details.

In fact, the most downloaded non-gaming app publishers in the Google Play Store in January 2018 were Facebook, WhatsApp, and Google. Facebook ranked first with over 130 million monthly app downloads worldwide. No wonder there are over 300,000 chatbots on Facebook since target users of companies are already there.

Varun Bhagat wrote at Customer Think that another major advantage of a chatbot is that unlike a human agent, it can work 24/7 and is not vulnerable to any stressful conditions or complex situations a human may face. This is perhaps one of the reasons why over 60% of people today might prefer to deal with a chatbot instead of human assistance.


Trusted Customer Engagements Through Chatbots was originally published on


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