Chances are, if you’ve dealt with a company’s customer service department or emailed someone and gotten a response from their “personal assistant,” you may have already unknowingly experienced what it’s like to interact with a chatbot.
Chatbots are artificial intelligence robots that imitate human conversation through voice commands, text, or both because they are embedded with machine learning and natural language processing (NLP). Chatbot algorithms are designed with machine learning while NLP is used to pick up conversational cadences and mimic human conversation, according to Business Insider.
Make no mistake: chatbots of varying types are here, and they are reshaping the way enterprises operate, both internally and externally. By 2021, more than 50% of enterprises will be spending more each year on bots and chatbot creation than traditional mobile app development, according to Gartner.
Market forces driving chatbot deployment include increasing pressure on contact centers, due in part to high turnover rates, rising demand for self-service, advances in AI and NLP, and the maturity of chatbot platforms, according to Deloitte. User acceptance is growing because of these advances, and chatbots are shifting from command-driven to more intelligent, conversation-driven ‘virtual assistants’ that are far better at determining context and user intent, the firm notes.
The global chatbot market is expected to grow significantly, driven by the need to improve service while reducing operating costs. Grand View Research estimates that it will reach $1.25B by 2025.
More frequently, chatbots are being integrated with technologies like AI, IoT and APIs to offer enhanced operations. AI and audio speech-based chatbots are expected to account for the largest market share in the future, Grand View says. The research firm concurs with Deloitte that because speech recognition has improved drastically, especially in terms of native languages, we can expect to see chatbots with enhanced performance in various applications.
Among the many use cases for chatbots are customer service and customer education, content delivery, entertainment, and e-commerce.
Additionally, enterprises that offer a variety of products and services can use them to provide in-depth product knowledge to help customers navigate their searches. They can streamline different business processes to free employees from having to perform repeatable and mundane tasks, so they can focus on more mission-critical work, notes Forbes.
Often, IT and HR departments are flooded with questions from employees. A chatbot can use internal data to provide instant responses so staff don’t have to. With simple text commands, a chatbot can be prompted to scroll through data and automate insights about customers, employees and sales.
Enterprise chatbot platforms can also be used in a business to business (B2B) context, to place orders, pay for supplies, and request information from external suppliers.
At DBS Bank based in Singapore, as part of its digital transformation effort, a mobile-only bank was deployed in India that offers all its services via digital channels. DBS digibank, as it is called, conducts all customer service from a conversational AI platform.
A virtual agent handles 82% of customer requests and inquiries and helps more than 1.8 million digibank customers manage money, track expenses, analyze spending, and improve financial literacy and well-being, according to a report by Altimeter.
To achieve this, a team built a list of over 10,000 questions that customers could potentially ask. The goal was to understand the customer’s intent. If a customer expresses frustration during an interaction, the agent transfers the context of the conversation to a live agent to resolve.
If you’re just starting your chatbot deployment journey, do your research when deciding from a large variety of platforms to ensure it will fit your organization’s needs.
Like any implementation, expect challenges. But by most accounts, chatbots are worth the effort. Their greatest value is in increasing enterprise productivity, streamlining processes, and reducing costs.
Esther Shein is a longtime freelance writer and editor specializing in technology and business. Previously, she was the editor-in-chief of the online technology magazine Datamation, a managing editor at BYTE and a senior writer at eWeek (formerly PC Week).