Why Retailers Should Use Chatbots to Transform Their Digital Marketing Strategy

Conversational Commerce, or what’s known as c-commerce, encompasses interactions when people and businesses connect through chat, with the intent to drive purchase of goods and services. According to a study by Facebook and Bain & Company, Southeast Asia consumers have the strongest preference for conversational commerce.

With all the chatter across industries about chatbots, many retail brands are wondering if they should invest in these technologies to handle customer queries, improve customer service, and increase sales revenue.

Yes, there’s a lot of talk about retail chatbots, only for their lack of human touch and natural language processing maturity. After all, human interaction is still something consumers seek.

That said, IBM research found that consumer shopping behaviors have fundamentally changed thanks to artificial intelligence (AI), mobile technology, and social media. Today’s customers are always-on — they shop anywhere, anytime, and any way they want. They now have more demand for convenience, speed, ease, and ever-available shopping experiences.

To keep pace with the ongoing shift toward e- and c-commerce, retail chatbots can be a perfect solution. Let’s look at three reasons why retailers should implement chatbots in their digital marketing strategy.

Digital consumers in Southeast Asia have grown exponentially, from 90 million in 2015 to 300 million in 2020. This number is expected to grow 1.2 times by 2025.

Consumers engage with brands for several reasons, but most of the time, they reach out for transactional needs like purchases and returns or to make a complaint. Being able to quickly give customers a resolution is crucial because one negative experience might be all that it takes for them to turn to a competitor.

Today’s consumers are also demanding self-service. No longer are they prepared to wait weeks, days, hours, or even minutes for a support agent to help them. They need their problem fixed, and they need it fixed now. Chatbots bring consumers an easier and quicker way to contact retailers. Instead of filling out forms or writing emails to ask for help, they now just need to click the chat button on a website, and they can get instant support. Because chat conversations are real-time, chatbots give consumers the sense that they’re interacting with a real agent.

By implementing a conversational service suite, you can centralize all chat channels into a single dashboard and create a seamless omnichannel customer experience. That means your support agents no longer have to switch back and forth among platforms, helping boost their focus and performance. As a rule, happy employees lead to happy customers.

TESCO Malaysia is an excellent example of using retail chatbots to improve customer service. TESCO worked with AiChat to promote their new catalogs to more customers and to automate common asked questions through Facebook Messenger. Within only four months, AI Chatbot helped TESCO decrease general inquiries by 13% and handled about 85% of total customer requests.

There can be a huge disconnect between marketing and sales; maybe marketing doesn’t know what sales needs to do their work, or sales doesn’t know exactly how marketing benefits sales goals.

Chatbots are great for bridging the gap between marketing and sales. They allow you to track all customer conversations and interactions like button clicks, questions asked, lead scores, and segments. By looping everyone in on your chatbot strategy, you can get marketing and sales on the same page — and convert more prospects into customers.

Chatbots provide you with detailed reports about chat volume, retention rate, customer satisfaction, and intent-based metrics. All of these data are helpful to improve the performance of automated follow-up messages, click-to-messenger ads, and other retargeting campaigns.

Personalization is the key to win the hearts of modern consumers. A report by Epsilon found that 80% of consumers are more likely to make a purchase when brands offer personalized experiences.

By prompting a customer with a series of questions, chatbots can help you identify their needs and suggest the most relevant product to them. According to Capgemini Research Institute, 67% of consumers trust personalized recommendations provided by AI-enabled interactions. These AI-powered recommendations can keep consumers coming back for more after their first visit.

An example of using chatbots to increase customer retention is Philips Lighting. Philips Lighting launched its first retail chatbot on their Singaporean Facebook page. The goal was to enable customers to search for products or get personalized recommendations based on their preferences via bots. The result was impressive as Philips Lighting has achieved sales conversion rate of 12% via Facebook Messenger.

Another way chatbots can help drive sales is through sending cart abandonment reminders. Using a chatbot, you can create an automated sequence of messages and send them to customers through Facebook Messenger. This strategy can be more effective than sending abandoned cart emails because most Southeast Asia consumers learn about products and brands via social media rather than checking their inboxes.

There’s never been a more exciting time to be in the retail industry. With a lot of changes in customer expectations and behaviors, it’s time for retailers to transform their digital marketing strategies. By embedding messaging apps and chatbot technologies, retailers can deliver a next-level shopping experience and develop data-driven marketing campaigns, which helps increase customer intention and sales revenue.

Interested to develop an AI Chatbot for your retail brand? Talk to us today, and we’ll help make chatbots work for you.