Benefits of Chatbots

Chatbots have become increasingly popular in recent years and for good reason. Businesses and consumers alike have already begun to experience the benefits of chatbots in a variety of areas. Some of the key benefits include the ability to handle large volumes of requests simultaneously, provide instant responses, and operate 24/7 without breaks or downtime.

But the benefits of chatbots don't stop there. Chatbots powered by artificial intelligence (AI) offer a number of additional benefits to enterprises that go beyond simple automation. These chatbots can help to improve customer experience, increase efficiency, and drive business value.

69% of consumers prefer chatbots because of their ability to provide fast answers to simple questions

- Chatbots Magazine

So, why use a chatbot? The answer is simple: chatbots offer numerous benefits that can help your business thrive in the 21st century. By understanding the benefits of chatbots, businesses can make an informed decision about whether this technology is right for their needs.

Why use a chatbot?

Customers prefer to use chatbots over legacy channels like phone and email because they are convenient, easy to use and empower self-service. Chatbots also have a number of benefits including helping to reduce operating costs and increasing employee productivity.

Here is a list of the 7 top areas where chatbots can drive value to both businesses and consumers:

1. Instant response times

Consumers place a high value on speed and convenience when seeking help or information online. AI chatbots can provide immediate responses to customer inquiries, eliminating the barrier between a brand and its customers. By using a chatbot, an enterprise can provide real-time assistance to its customers, helping them to quickly find the information they need or resolve any issues they may be facing.

This can improve the customer experience and increase customer satisfaction. Customers are more likely to be happy with a brand that provides fast and convenient service, and a chatbot can help to deliver this level of service consistently. Additionally, chatbots can handle multiple conversations simultaneously, allowing an enterprise to provide assistance to multiple customers at once. This can help to improve the efficiency of the customer service team and allow them to handle a higher volume of inquiries.

2. Increase revenue

Chatbots can provide valuable assistance to customers and help to increase sales and drive revenue for a business. These chatbots are able to interface with a customer's account and use the information they find there to suggest products and services that the customer may be interested in for up-selling and cross-selling purposes. This can help to improve the customer's experience by providing personalized and relevant recommendations, and it can also increase the chances of making a sale.

In addition to suggesting products and services, a chatbot can provide information about promotions or discounts that may be available. This can help to drive sales by making customers aware of special offers and encouraging them to take advantage of them.

Chatbots are expected to drive $112 billion in retail revenue by 2023

- Juniper Research

3. Keep costs down

A chatbot built on a scalable conversational AI platform can provide the same level of service as a team of human agents, without the need for an organization to onboard additional staff. This can help to keep costs down, as it reduces the need to hire and train additional customer service representatives.

4. Increase employee efficiency

Using a chatbot to empower self-service and automate repetitive customer inquiries can help to increase employee efficiency by freeing up employees to focus on high-value interactions. A chatbot is available 24/7 and can handle multiple conversations simultaneously, allowing it to provide assistance to a large number of customers at once.

By using a chatbot to automate routine tasks, such as answering frequently asked questions or providing information about products and services, human agents can focus on more complex or personalized inquiries. This can help to improve the quality of customer service, leading to increased customer satisfaction and loyalty.

5. Open up new channels

Chatbots have the potential to greatly expand the ways in which enterprises can communicate and engage with their customers. By using chatbots, businesses can deploy and test fully-automated, multi-channel experiences for sales, service, and support without the need to invest significant resources in onboarding and managing new teams.

This not only streamlines and simplifies the customer experience, but also allows businesses to test and explore new channels of communication without incurring significant costs.

70% of white-collar workers will interact with conversational platforms on a daily basis by 2022

- Gartner

6. Bolster brand loyalty

In today's competitive market, it is more important than ever for businesses to focus on building brand loyalty among their customers. One effective way to do this is by delivering dynamic and memorable self-service experiences. A chatbot provides customers with an enjoyable and easy-to-use self-service platform that can not only improve customer satisfaction, but also increase the likelihood that customers will continue to engage with the brand and make repeat purchases.‍

7. Available 24/7, 365

Customers often want to contact businesses outside of regular office hours, and chatbots provide an efficient and scalable way to address their inquiries at any time of day or night. With a chatbot, you can provide 24/7, 365 support to your customers, ensuring that they can always get the answers they need, whenever they need them.

Key features and benefits of chatbots

When considering how a chatbot can be used to benefit your business, it's important to understand the key features and benefits that an AI chatbot can offer.

High accuracy & resolution rates

In order for a chatbot to be effective at automating customer requests, it must be able to understand the customer's language and intent. This requires the use of robust language understanding algorithms. A chatbot with strong language understanding capabilities can:

  • Interact with customers in a conversational manner, using natural language instead of pre-defined responses
  • Understand and act on the customer's intent, even if the request is complex or not explicitly stated
  • Identify multiple intents in the same request and provide appropriate responses for each
  • Understand the context of the conversation, so that interactions remain on track and relevant
  • Ask follow-up questions to clarify information and gather actionable data

These features are essential for achieving high automation rates with chatbots. Without them, the chatbot may not be able to effectively handle customer inquiries, leading to frustration and a loss of confidence in the technology.

Scalable intent hierarchy

Basic chatbot solutions often only have the ability to handle a limited number of topics, typically around 100-200. While this may be sufficient for simple businesses with a small number of products or services, it quickly becomes inadequate for larger organizations with complex offerings. For example, a bank, insurance company, or government organization may have thousands of different products and services that a chatbot needs to be able to handle.

A scalable chatbot solution is necessary for these larger organizations. A robust conversational AI platform allows a chatbot to handle a much larger number of intents, typically in the thousands. Additionally, a hierarchical structure for intents makes it easier for the AI to keep track of them and provide accurate responses to customer inquiries. This is more effective than having all intents at the same level, which can be difficult for the AI to navigate. Categorizing intents by subject matter allows the chatbot to quickly find relevant information and provide a personalized response to the customer.

Broad scope vs. narrow scope chatbots

Trying to solve a limited set of problems with a chatbot may seem like an easy solution, but it is not likely to provide sustainable returns on investment in the long term. Instead, a more effective approach is to use conversational AI to create a chatbot with a broad scope that can handle a wide range of customer inquiries. This is especially useful for enterprises that have a large volume of customer service traffic on a daily basis.

A chatbot with a broad scope can not only help an organization to achieve short-term wins, but also to achieve long-term strategic goals. Additionally, a conversational AI platform with robust language understanding enables the chatbot to scale and automate at consistently high rates, providing value to the organization over the long term. By investing in a chatbot with a broad scope, an enterprise can improve its customer service, increase efficiency, and achieve its strategic goals.

Total cost of ownership

As chatbot technology continues to advance, businesses are increasingly looking for ways to have more control over how they manage their bots. This has led to the development of low-code or no-code chatbotsolutions that enable customer service representatives to build and manage dynamic customer interactions without the need for data scientists or developers.

These solutions empower customer service reps to leverage their expertise and experience to create personalized and effective chatbot interactions. By putting the power of automation into the hands of the customer service team, enterprises can improve the quality and effectiveness of their chatbots, leading to better customer satisfaction and increased efficiency.

Pre-built, vertical-specific content

Creating a chatbot from scratch can be a time-consuming and complex process. One way to reduce the initial workload is to use a conversational AI platform that offers pre-built content for specific verticals. For example, a chatbot platform may offer banking-specific content that includes knowledge about credit cards, mortgages, and other banking products and services. This ready-made content can be tailored to match the brand guidelines of the organization.

Using pre-built, vertical-specific content can significantly reduce the time and effort required to launch a chatbot. Additionally, when combined with self-learning AI, the chatbot can continue to improve and evolve over time, becoming more effective at handling customer inquiries. This can help to shorten implementation timelines from weeks or months to just a few days.

Conversation analytics

To optimize a chatbot, it is essential to be able to analyze and understand what customers are asking about. This requires the use of analytics tools that can mine conversation and interaction data. Some useful features to look for in these tools include advanced search, tagging, quality rating, clean-up reports, and API support.

These features allow an organization to gain insights into customer inquiries, identify areas for improvement, and make data-driven decisions about how to optimize the chatbot. By using analytics tools to analyze customer interactions, an enterprise can improve the effectiveness of its chatbot and provide better customer service.

Seamless human hand-off

One of the key benefits of using robust natural language understanding in a chatbot is that it allows the AI to recognize when it doesn't understand a customer's request. In these cases, the chatbot can seamlessly loop in a human agent to assist without disrupting the customer experience.

This approach can help to increase customer satisfaction and loyalty. By recognizing when a request is outside the scope of the chatbot's capabilities and leveraging human support, the enterprise can provide a more personalized and effective response to the customer. This can improve the customer's overall experience and make them more likely to continue doing business with the organization.

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