While many think of conversational AI as a new technology, in practice, it has been used by brands for more than 20 years. In fact, my co-founders and I developed many of these early systems and have been working ever since to evolve the state-of-the-art in the field. Unfortunately, many brands have not moved beyond legacy Conversational AI systems – focused on cost savings for service and support – to embrace modern conversational AI systems, which are focused on revenue generation for marketing and sales.
What these brands don’t seem to realize are two important things: (1) consumer needs and expectations have changed significantly over time, and (2) while legacy conversational AI systems haven’t kept pace with new consumer needs and expectations, modern conversational AI systems (from Automat and others) have been built from the ground up with today’s consumer in mind.
Expanded consumer choice is at the root of evolving consumer needs and expectations. The 2018 Accenture Interactive Personalization Pulse Check report defined businesses’ number one challenge in meeting consumer needs as “learning how to uniquely serve everyone without overwhelming anyone. We [call] it the ‘burden of choice’ … The endless aisle sounds great until you are the one having to walk down it.”
“Overwhelmed by choices, consumers are more likely to make poor decisions, be less satisfied, and abandon a website or brand altogether.” As part of enabling a two-way digital dialogue, the report found that 74% of respondents said they would find “living profiles” valuable if they could be used to curate the experiences, offers and products they receive.
Creating a true two-way digital dialogue is where legacy conversational AI systems fall down. Designed to handle mostly one-off customer service issues, older systems are ill-suited to build customer relationships through the entire customer journey. Instead, brands need to leverage the new capabilities of systems that are purpose-built to surface the right conversational experiences at the right points in the customer journey, and further connect these experiences across marketing, sales and support into a unified, two-way dialogue between the consumer and the brand.
The Origins of Conversational AI
Conversational AI originated with touchtone IVR systems in the late 1980s and evolved to support speech recognition during the mid-to-late 1990s and natural language understanding (NLU) in the early 2000s. These systems effectively reduced the number of human agents needed to field service calls and saved millions of dollars for the world’s largest companies. Unfortunately, they also often led to a dissatisfying outcome for many consumers who found them clunky, unwieldy, often inaccurate and sometimes frustrating beyond belief.
Far from being a necessary evil, though, these systems continue to be a staple of customer service strategies and have more recently been augmented by support through email, live chat, mobile apps and, to a more limited degree, through SMS.
“Just for Customer Service?”
Because of its history in customer service, many brands may think of conversational AI as devoted to that niche. Some brands, however, have broken the mold thanks to new technological developments, and are beginning to deploy conversational AI across their entire customer journey.
One inflection point for brands was in 2012 with the introduction of a product called Nina developed by my co-founder Andy Mauro and its application with Dom, Domino’s virtual assistant, broadly advertised to promote voice-ordering of pizza.
Pizza is famously the reason behind the first bitcoin transaction, and our love for it may explain its presence in so many historical moments. Beyond pizza, however, brands also began to expose messaging-based conversational AI on the homepages of their websites instead of burying it on a support page. Facebook Messenger bots caught fire, and are gradually forming part of the future of social media, while home voice assistants and other solutions are gradually taking hold across more points in the customer journey.
And this is where brands are increasingly leveraging conversational AI for revenue generation. Vichy is one such example. Their virtual skincare expert answers essential questions and offers guidance, recommendations and a personalized skincare diagnostics that drives greater engagement, consumer insight and revenue.
National Bank of Canada uses a chatbot that accomplishes much the same goals, offering consumers the ability to book appointments, ask questions and get support. In allowing consumers to book appointments, the chatbot surfaces their needs and goals and then personalizes the interaction to yield greater marketing ROI than traditional booking methods. The fact that this application also connects with their customer support efforts further reduces the time and attention required by consumers to have any of their possible needs addressed, offering a consistent experience not possible with previous conversational AI technologies.
Both of these brands have deployed conversational AI that is more advanced than what was thought possible decades ago, but also designed to accomplish entirely different goals. While brands who’ve already deployed systems like IVR may still see benefits, legacy conversational AI systems have been outgrown by any brand’s need to fulfill consumer expectations for the best possible experience.
Offering Guidance, Recommendations and Personalized Responses with Conversational AI
Some proponents argue that a human touch defines the capabilities of conversational AI, because so much of what makes humans “human” is our ability to converse and discuss with one another at length, all with social cues, affectations and subtext at play. This is far more suited to the kind of product discovery processes and moments of awareness that consumers experience at the very beginning of a customer relationship or a path to purchase. While saying that the ability to address these concerns through conversational AI makes it more “human” is a bit of a stretch. What’s true is that it does provide one crucial new concept to consumers.
“The evolution of conversational interfaces will change the world around us. Digital technology will finally become truly intuitive, helping to address digital exclusion and providing a new way for brands to build relationships with their customers.” – Fernando Lucini, Managing Director at Accenture Digital
As mentioned earlier, modern consumers are overwhelmed by choice and need guidance, recommendations, advice, consultation, and expertise (what we refer to as GRACE) to successfully navigate that sea of options. Personalized interactions with companies like Amazon, Netflix, Apple, Google and others have set the standard for modern customer experiences, and consumers are beginning to expect personalization no matter what brand they do business with. Fully 86% of consumers say that personalization impacts their purchasing decisions. Though personalization is a critical bar to pass for consumers, many brands are failing to measure up.
Until recently, companies simply provided self-service websites to their consumers, forcing the consumer to do the “heavy lifting” in figuring out which products or services were right for them. With the advent of new conversational AI technologies, brands can now move from self-service to GRACEful service, offering convenient, immediate and personalized guidance and recommendations they might otherwise only get from a knowledgeable sales consultant, all with the scalability, 24×7 availability and predictability that only this technology can enable.
Conversational Marketing, AI and the Future of Customer Experience
Consumers crave greater personalization and connectedness in their experiences, but this can’t come at the expense of their own privacy. Not being able to engage on their own terms is one of the biggest turn offs for consumers when they interact with brands today. Even though consumer expectations have grown higher than ever before, brands need to commit to offering complete experiences that don’t just sell.
Brands can provide real value to their consumers by engaging them in a conversation. Rather than blasting them with irrelevant marketing messages that only push consumers away, brands can leverage conversational AI for revenue generation within marketing and commerce portals, Legacy systems aren’t built for this, but new platforms have come online to empower brands to do this in ways that yield meaningful benefits, and still connect to the same experiences they’ve always offered.
Automat is a Conversational AI provider that allows brands to offer guidance, recommendations and instant, personalized responses to consumers. Contact us to learn more about what Conversational AI can do for you.