What are chatbots and why are they essential for businesses?

Although they are relative newcomers to the ranks of business technologies, chatbots are steadily becoming indispensable to businesses that seek new means to communicate with their customers online

Chatbots can be used for a wide range of roles–from entertainment to business and education–and just as digital assistants are increasingly more commonplace, the use of chatbots has become ubiquitous.

Their main super-power is providing people with answers quickly and without overtaxing human support agents, nor irritating customers with long wait times.

What is a chatbot? A history

The earliest chatbots date back to the dawn of computing. One of the original chatbots was ELIZA, created in 1966 by Joseph Weizenbaum. ELIZA tried to imitate a conversation and reply to questions by using pre-written scripts with responses. ELIZA has had a major impact on the development of natural language processing and artificial intelligence (AI) as a whole.

A few other chatbot “personalities” worth mentioning are Jabberwacky and Ultra Hal. Jabberwacky was created in 1981 and became one of the first chatbots that used natural language processing. Ultra Hal, originally designed as a personal assistant, could have “conversations” with people by using speech synthesis.

The chatbots of today are much more sophisticated. Thanks to artificial intelligence, they can learn from previous conversations and change their responses, making it possible to imitate human conversations much more realistically. Empowered by the training data sets and the imagination of their creators, modern chatbots are so much more than their humble predecessors.

How do chatbots work for brand-customer interactions

For many businesses, leveraging innovation is one of the cornerstones of a successful business strategy. Essentially, chatbots are a kind of conversational UI that enables brands to communicate with users who use natural language, making brand-user interactions via chatbots – much like a friendly chat.

Thanks to this accessible, conversational format, chatbots are an effective way to provide users with the information they want, whenever they want it: they are great for giving automatic updates, responding to FAQs, and providing other information that customers might need, particularly in conversational environment, such as a messaging app.

Here are some of the reasons why chatbots are essential for businesses

Personalized service: thanks to data from brands’ CDP and CRM systems, chatbots can ensure each customer gets a personalized experience. For instance, brands can program their chatbots to provide custom recommendations and respond differently to product-related queries based on each client's specific needs. This allows businesses to provide personalized, highly-relevant service--at scale.

Available 24/7: customers can reach a business any time of day and night, even when the customer service agents are offline. This is particularly useful for brands that operate in multiple time zones or have customers across the world. This guarantees that customers are always taken care of and can get the help they need, which is beneficial to customer experience as a whole.

Cost-effective: chatbots automate tasks that would otherwise have to be handled by customer support agents. This saves customer service costs and frees up human staff to manage more personal or complex customer interactions. Chatbots can also deal with multiple chats at a time, so customers don’t end up waiting on hold or in a queue, which improves customer satisfaction—without having to spend more on hiring additional support staff.

Efficient: chatbots can automate repetitive and menial tasks such as order tracking, customer service inquiries, and scheduling appointments. This spares the customer service team from humdrum work and leaves them more energy to handle complex issues and provide quality service.

Examples of services a chatbot can power, courtesy of Rakuten Viber

How can chatbots be used: retail, e-commerce and banking

For a retail business, the importance of first-class customer service is obvious. Because customer experience can often determine whether they come back, it’s essential for retailers to provide fast, efficient, and friendly assistance whenever possible. However, most people have work, personal chores, and other priorities, so the time they have to dedicate to shopping doesn’t always coincide with a store’s working hours. So, when the actual stores are closed, chatbots are invaluable: it’s available round-the-clock and doesn’t need weekends, so it can see to customers’ needs, whenever they get in touch.

For e-commerce, chatbots can help increase sales through upselling and cross-selling, providing personalized recommendations, and even showing products in 3D or letting customers “try on” clothes before they buy it.Enhanced customer experience: example from Rakuten Viber Chatbots

For banks, chatbots are a great way to offer clients 24/7 assistance and support, as well as to provide information and updates about banking services. Chatbots can answer frequently asked questions, show the closest branch locations, and help with simple services. They’re a powerful tool to engage with the clients and increase loyalty and retention.

Enhanced customer experience: example from Rakuten Viber Chatbots

The bottom line is that chatbots can be a fantastic asset to any customer support team, but they work to their highest potential when they seem natural and personal, so it’s important to choose and develop a chatbot that works best for your specific business goals and audience. For example, the chatbot service provided by Rakuten Viber lets you build your chatbot and integrate it with existing systems. It can be trained to respond to customer queries in a variety of ways and can even send automated messages to customers in response to specific events. Chatbots on Rakuten Viber can be programmed to send personalized messages at the right time and with the perfect content.

Chatbots: future prospects and what to look forward to

As AI continues its evolution, so do chatbots. Having started as simple text-based algorithms, modern chatbots are able to hold conversations, and can even simulate emotional responses. Many companies see the future of commerce and customer service in conversations—messaging apps, in particular, are well-positioned to realize the potential and importance of good conversations. This is why many messengers, such as Rakuten Viber, prioritize developing chatbots that can offer businesses multiple advantages, including improved customer service, reduced costs, and freeing staff to work on creative tasks.