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What is Conversational Commerce?

“Conversational Commerce” is a new form of ecommerce where brands and consumers communicate through live representatives and AI assistants in order to explore offerings, make transactions and receive services or help with their purchases.

When you actually experience conversational commerce, you realize that it makes it easier to get information about products you care about and make decisions about whether to buy them. It also gives brands an opportunity to provide the kind of instant, personalized advice that better satisfies consumers and helps them feel more connected with that brand.

So, what’s more to understand about conversational commerce? Because of the way it changes ecommerce, it also fundamentally changes the brand-consumer relationship. This gives brands the opportunity to sell more, because each part of the conversations your brand has can be personalized and optimized towards the best outcome. Buying more doesn’t just benefit the brand – it also improves the satisfaction a consumer has with their experience because they’ve chosen the right products, through whatever channel they’ve used to connect. 

Conversational Commerce changes the way consumers shop by allowing them to get recommendations, simplify their product choices and get relevant product information that also encourages them to buy more.

Conversational Commerce Creates A More Natural Brand-Consumer Relationships

All credit is due to Chris Messina, who best defined the term in 2016. He framed it this way:

Conversational commerce is about delivering convenience, personalization, and decision support while people are on the go, with only partial attention to spare.

Of course, we’d love to give him even more than full credit – he is an advisor of ours here at Automat. Ultimately, however, we view convenience, personalization and decision support as part of the same problem, which is finding ways to simplify choice for individual users or consumers. Before the emergence of messaging as the dominant mode of communications, brands needed to rely on things like phone calls, emails, live chat and in-store representatives to actually talk to and provide convenience to this kind of consumer. 

Today, messaging not only offers an easier access point and is affecting consumer expectations across every channel – it’s also giving brands an easy avenue to automate and personalize decision support for purchases in a conversational way.

That’s why conversational commerce is not just a more useful way for consumers to shop. It’s also becoming more popular among brands who want to keep growing their ecommerce revenue, and that’s just one way in which its also simplifying the entire consumer decision journey

Instead of relying on one-way email marketing, digital ads or other traditional brand messages, brands can use conversational commerce to create a stronger relationship with every question, statement, assertion and declaration made in a conversation.

Consumers are also growing to prefer messaging businesses instead of getting spammed with the same old marketing messages. In the US, 61% of consumers have messaged a business in the last 3 months, and in other global markets those rates can tend to be even higher.

More consumers are also getting accustomed to making purchases through messaging and are willing to make such purchases again. Conversational commerce makes interacting with a brand more attractive: when they engage with a brand, they know they’ll learn something that will let them achieve their goals, get what they need, or just buy something they’ll love.

Messaging apps drove much of the initial growth in conversational commerce, but now consumers are growing more accustomed to making purchases through conversational tools like chatbots.

How Conversational Commerce Lets Brands Sell More

So, just because there is fertile ground for conversational commerce, how can you be sure that you actually generate higher conversion by practicing it? 

Many brands use live chat or in-app messaging interfaces to connect representatives with consumers in order to address traditional customer service functions. At the same time, they also use this as an opportunity to cross-sell and up-sell to consumers. 

This has been common customer service practice for decades, which doesn’t necessarily leverage all the access to consumer requests that messaging has to offer. Focusing on support and ignoring the first path to purchase also requires you to have an existing customer relationship or subscription, which closes off most of the opportunities that conversational commerce gives you to increase revenue. 

Virtual Sales Advisors change all that. These solutions usually come in the form of conversational AI deployed to advertising, websites and social media channels, and can also be made accessible from retail stores and through voice assistants. 

Here is one example of a Virtual Sales Advisor deployed by the skincare brand Vichy. 

They form the basis of the strongest use case for conversational AI, which is to talk to consumers, learn about them and personalize their experience, provide recommendations and encourage them to take positive actions. 

By centering the conversations you have with consumers around product discovery and providing recommendations, you give your brand the opportunity to easily scale a better experience. Most of your brand’s products are already positioned to address a specific group of consumers or set of needs, so why not learn about your individual customers and personalize the way you present products to them?

This doesn’t just encourage people to buy more. Although brands can see more than 30% higher revenue per user from a virtual sales advisor compared to a traditional ecommerce web session, the consumers who tend to chat with businesses also spend 60% more overall than those who don’t. This can be a huge windfall if you’re trying to grow your ecommerce revenue, but it can also give you a stronger relationship with each and every consumer. 

When Commerce is Conversational, Satisfaction Goes Up

Getting help in a conversational way makes consumers happier – both before purchases and after. Customer satisfaction from chatbots is at an all time high. 15% of consumers have made a purchase from a retail chatbot, and 81% of those would do it again. Conversational AI is used more everyday by consumers, specifically because it’s the best way to “do” conversational commerce.

The feedback that consumers provide for these experiences shows why they’re so effective at selling to and satisfying customers. Consumers see conversational AI for commerce as quick, easy, fun, friendly and informative, even though they spend more time with a chatbot than they do with a website and take in less information overall.

Why would this work? Well, consumers don’t have to expend all their energy to interact with a chatbot – the experience is served up for them. This is something that is generally true of most conversational commerce practices: conversations allow brands, whether through humans or machines, to anticipate and respond to consumer needs on an individual basis.

It makes them feel special. It should come as no surprise that it makes them happier too!

Conversational Commerce Must Be, By Nature, OmniChannel

Conversational commerce generates profound benefits for many brands. By adding a conversational approach to the way you market and sell to consumers, you can then begin to naturally link the core capabilities of your Virtual Sales Advisor to every channel and experience that matters most.

For instance, you might include a virtual sales advisor on an ecommerce website, but what if you could also get the benefits of engaging a consumer in conversation directly from an ad? What if you could include the same great experience across different paid media campaigns and on your social channels? What about in retail stores?

Conversational commerce is many things, but it’s also what you make it. There are best practices, but there’s also no limit to the ways you can interact with your consumers. As you start thinking of ways to better personalize the conversations you offer, you’ll see just how good they make your customers feel.

Book a demo with Automat to learn more about getting the benefits of conversational commerce for your brand

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