Here come the chatbots.  Is your business ready?  How will this impact marketing?  What should your business be doing to design and execute a smart chatbot strategy?  

A short while back, Microsoft’s CEO Satya Nadella famously said “Bots are the new Apps.”  He envisions “people-to-people conversations, people-to-digital assistants, people-to-bots and even digital assistants-to-bots. That’s the world you’re going to get to see in the years to come.”

Nadella is pitching a new bot development framework called Conversations as a Platform, consisting of developer tools to make bots that understand the human voice and use machine learning to answer questions and deliver useful information.

He’s definitely right about this: Messaging apps have overtaken social networks:

The logic is simple.   The app model has stalled.

App-fatigue has been brought on by too many apps.  Who wants to download yet another app and waste time learning how to use it?

Turns out humans can only handle so much information.  Thus we limit the number of platforms we adopt – and the result is a few winners with most of the gains.

With chatbots, the field is wide open. Everyone is going to where the customers are – and they are now on messenger platforms:

Definition: What is a Chatbot?

Wikipedia’s definition is a good start:

A chatterbot (also known as a talkbot, chatbot, Bot, chatterbox, Artificial Conversational Entity) is a computer program which conducts a conversation via auditory or textual methods. Such programs are often designed to convincingly simulate how a human would behave as a conversational partner, thereby passing the Turing test. Chatterbots are typically used in dialog systems for various practical purposes including customer service or information acquisition. Some chatterbots use sophisticated natural language processing systems, but many simpler systems scan for keywords within the input, then pull a reply with the most matching keywords, or the most similar wording pattern, from a database.

How does a Chatbot work?

For now, we can classify three types of chatbots:

• Text bots — conversational products living within chat interfaces. Examples include: Slack, Facebook Messenger, Telegram, and Kik
• Visual bots — visual products living within chat interfaces. Examples include: WeChat, Google.
• Audio bots — voice-based bots. Examples include: Apple Siri, Microsoft Cortana, Google Now, Amazon Alexa.

Applications: What Do Chatbots Do All Day?

In almost every consumer-facing industry, chatbots are an inevitable part of the future. Why? Because they promise to give customers attention and recommendations without the cost related to traditional customer support. This is bad news for the outsourced call centers around the world. By 2020, customers will manage 85% of their relationship with the enterprise without interacting with a human.  That’s the prediction from analysts like Gartner.

So what roles are chatbots taking?  Virtually anything that requires “answering” predictable queries:

Designing a Chatbot Strategy

Where does a business begin?  There are three common approaches – one is to play fast-follower – watch what your competitors are doing, and learn from their mistakes.  The second, more daring approach, is to be a leader, blazing a trail in your industry or space.  And the third is to partner with an external-party to bring in the capabilities you lack.

The business goals for chatbot implementation include the following:

And that’s just for starters.  We will routinely interact and converse with chatbot agents, and soon – robots.

Dion Hinchcliffe believes smart chatbots will revolutionize digital/social engagement by adding a much needed automation and support of communication, knowledge management, and collaboration. He makes a strong case for using chatbots for community management.

Here are a few more opinions gathered from across the chatbot ecosystem:

• Tuck Ross points out that “as the lines between marketing, sales, and customer service continue to merge, this is where we find the opportunity for conversation conversions. With Messenger chatbots, you can have all three at once, in one app, in context — serving customers right where they are.”
• Bots will also be used for top-of-funnel advertising because they have the potential to be important tools for consumer discovery. Sephora and H&M have early examples of discovery-driven bots on Kik, allowing users to engage with the brand in basic ways.  More about this from Christian Baesler at Advertising Week.
• Kik thinks chatbots will kill the web.
• Microsoft has built a series of travel and entertainment bots on Skype.  This follows on the heels of another Microsoft’s chatbot experiment that went astray.
• Facebook is on it as well – their vision is to make Facebook Messenger your one-stop command center for all you need to live.
• Amazon is Amazon – we can expect to see Alexa move to a portable format (as an app or as a multi-platform chatbot) any day now.
• There’s even a Tommy Girl fashion-bot!

The race is on:

As marketers, though, there’s a critical contribution we can make.  And that is to build your chatbot strategy around customer needs.

What is the Job-to-be-Done?  What must be done to understand customer needs?

Will a chatbot suffice?

Do Humans Make the Best Chatbots ?

There is of course a contrarian view,  and that is to employ humans.

As far as conversations go, the chatbots still have a long way to go. Here’s a case in point: the customer service department at Sainsbury’s (a UK-based grocery store).

The ball was set rolling by a humorous complaint from one Leila Jayne Daly on Sainsbury’s Facebook page:

What follows is surely one of the best case studies for customer service via social media.  It is hard to imagine this sort of discussion with a chatbot, or with most humans, for that matter.

To date, the post has been shared 23,912 times, received 9.1K comments, and was liked by over 30K followers.  The fearless human in the customer service department at Sainsbury’s goes by the name of Ross.

You can read the rest of the fun here >>

Of course not all interactions can be this much fun, but Ross has given Sainsbury’s brand equity a certifiable boost.

For the more mundane FAQ type interaction, we will surely see chatbots take over.  But as marketers, we need to ensure the Rosses of the world are still kept on the front line.

Coming soon: a chatbot with personality?

Christian Sarkar is the editor of this site, a writer, consultant, artist, and entrepreneur.