This article is brought to you by Retail Technology Review: Conversational commerce: why the future of retail convenience lies in messaging apps and chatbots.
Consumer engagement is about to take another seismic leap, as a new wave of conversation commerce technologies is about to reshape the way we shop, explains SQLI CEO, Kevin Ludford.
The retail sector has made enormous investment in bringing digital and physical channels closer together in recent years, in order to better serve the end consumer.
And this 'phygital' opportunity is about to enter a new chapter. More and more retailers are using messaging, digital assistants, chat apps and automated, machine learning dialogue to engage with the consumer, offering them the opportunity to interact with brands and services. In doing so, the whole experience of shopping becomes more fluid, delivering simple, direct convenience with the personal touch and decision support that a consumer expects from human interaction. A new form of technology-led hybrid sales and customer service experience is being born.
Some of these technologies are not new; text messaging and chatbots are just two examples of communications methods that retailers have previously pioneered, but which failed to sufficiently engage the consumer. However, the market has moved on – and so has the tech – and these digital communication methods are poised for a resurgence.
Messaging apps and mobile momentum
One of the reasons that text-based communications are making a comeback is the rising popularity of mobile commerce; eMarketer statistics report that retail mcommerce grew by some 37.5 per cent in 2015, with mcommerce sales in the UK forecasted to reach £40bn by 2019. But the rise of mobile is not without its problems; screen size, lack of product details and a frustrating payment experience can be a challenge.
Messaging applications are a powerful way to circumnavigate the inconvenient moments of mobile shopping. Users can chat in real-time and receive valuable and convenient, customer service. This builds trust with the consumer, which will ultimately pay dividends when it comes to loyalty and customer retention, at the same time as relieving some of the pressure on telephone contact centres.
Not only that, but messaging apps give retailers a means of establishing dialogue within an increasingly popular channel. In February 2016, Facebook Messenger reported it had surpassed 1 billion monthly active users, with many consumers now heralding it as their primary means of communicating with friends and family. WhatsApp is following in the same vein; this holds great potential for forward-thinking organisations to create means of engaging with the consumer through their preferred, and accepted, channel. Some retailers are using messaging apps, a consumer friendly channel, to explore cutting edge technologies, such as augmented reality, to bring even greater levels of convenience to the retail experience.
For example, makeup retailer, Sephora recently teamed up with an augmented reality technology firm to develop 'Sephora Visual Artist' that styles a shoppers' make-up without them having to leave their computer screen. The app, which operates through Facebook Messenger, allows users to upload a photo of themselves to the virtual 'Sephora Visual Artist' chat bot, which in turn advises on compatible shades of make-up before leading them to the Sephora inventory, suggesting products they might then want to purchase. Here the consumer is using technology for shopping exploration.
Automating convenience: the rise of chatbots
While messaging applications allow retailers to reach consumers on the device they most frequently use, many are going one step further and bringing in chatbot functionality, to ensure instant dialogue with shoppers is always on offer.
Chatbots will take on-board a question or query and automatically suggest a solution, related topics of interest and even demonstrate humour and emotion. Enquiries about delivery and returns can be answered, just as they would in-store, face-to-face.
Whatever the customer needs to know, they can be satisfied 24/7 by an automated service, which has the capacity to help or elevate any complicated issues to a human as needed. Consumers want help, advice and even nurturing through the decision-making process; it makes the whole encounter effortless for them, establishing a rapport between the shopper and the brand.
And with messaging applications like Facebook Messenger now able to accept payments through chatbots, retailers now have the power to turn automated conversations into transactions, completing the purchase without shoppers having to leave the application.
While chatbots are still far from mainstream, already we are seeing many retailers and technology companies experimenting with their capabilities to make life more convenient for the consumer. Amazon's Echo is a great example of this; in one command, the user can make sure bread and milk is added to their basket, as well as seeking real-time delivery information. This is a technology path that will become increasingly popular as consumers develop a better understanding and acceptance of the benefits of automating aspects of their lives.
Other companies are looking to experiment with bots for advertising follow-ups, meaning that when a customer clicks on a dress they like via an advert, the brand's bot can private message the customer with assistance with their purchase. And the bots are clever too; through machine learning, they can recognise the customer next time they purchase and take on the role of a digital personnel shopper.
Conversational commerce: the next frontier in convenience
As the examples I have shared demonstrate, conversational commerce will use digital connectivity and artificial intelligence to bring a new level of convenience to the consumer. In fact, there are already retailers seeing the benefits in terms of website dwell times and average order values.
If the progression of retail in recent years teaches us anything, it is that the future of shopping will involve in greater speed and convenience. Effective conversational commerce is an obvious route to success in this respect, using emerging digital capabilities to increase personalisation and foster meaningful, long-lasting customer relationships.
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