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The Future of Customer Service: Chatbots

Nov 01, 2017 by Joshua Chakra

Many of us are lucky to have lived through three digital disruptions: the internet, mobile and now conversational UI. Let's face it, people will use their preferred communication channel, and it's up to you to learn how to figure out how to understand them. Recent research indicates that conversational UI will soon be developers' 1st priority, surpassing cloud-native and mobile-first projects in importance.


"Chatbots – built on a foundation of containerized micro services that connect to back-end systems via API – are not only an easy way to break into conversational UIs, they're an onramp to building and training artificial intelligence"
- Alexa Morales, Oracle

In 1994, a man named Michael Mauldin coined the term "ChatterBot" to describe these conversational programs. Today, chatbots are part of virtual assistants such a Google Assistant, and are accessed via many organizations' apps, websites and on most instant messaging platforms. Non-assistant applications include chatbots used for entertainment purposes, for research, and social bots which promote a particular product, candidate or issue.

Still, what's a bot? Put simply, a bot (commonly known as a chatbot) is a computer program which conducts a conversation via auditory or textual methods. These programs are often designed to simulate how a human would act as a conversational partner. These systems are typically used for various practical purposes including customer service or information acquisition. Some bots use a more sophisticated natural language processing system, while many simpler structures scan for keywords within an input, then pull replies with associated matching keywords, to similar wording patterns — from a database.

Without a doubt, most consumers today are increasingly tough critics who hold much tighter attention spans. How can we better serve our audiences with warm and effective responsiveness across channels? There are answers in chatbots.

These growing technologies are definitely a double edged sword for various service based industries. Our very own VP of Customer Support, Brittany Naylor shared her thoughts:

"I think chatbots are extremely helpful for resetting client expectations, and answering frequent requests. In other ways, I feel like chatbots can be impersonal and canned answers can lead to customer frustration. It can be both good and bad! But it's a great place to start in helping the customer feel like someone is there to talk to right away or get them pointed in the right direction."

Can we get an amen? We can all agree the landscape of customer service is changing and as we approach 2018, each new innovation has the potential to take the customer experience to the next level. A leading trend in the future of front end customer engagement is the involvement of AI. The largest companies in the world like Uber, AirBnB and, of course, Amazon are aggressively changing the bar. With markets moving so quickly, fighting inefficiency, staying relevant and navigating other various sophistications is a challenge faced by every small business. How does your business stay afloat in this daunting marketing landscape of the future? Surely — through providing stellar customer service, powered by AI.

Linc, a company that helps retailers offer post-purchase customer recently sat down with TechStyle (parent company to brands such as Fabletics, JustFab, ShoeDazzle and Fabkids) who has implemented chatbot technology over the last year:

"Currently for shipping and tracking notifications and real-time queries. A bot handles more than 60 of interactions, with 75 percent of the shoppers asking a question or making a comment. Members have the ability to speak to an agency with real-time support when a bot cannot support the question that's being asked. We're actively looking ahead, and are in the exploratory stages of investing in returns and exchanges, SMS and WhatsApp to enhance our digital strategy."


When asked about the feedback they are getting from customers after using a chatbot:

"Our members love it! Once our members opt in, they stay opted in. We have a minimal opt-out rate at less than 1 percent, with feedback pointing to the value and convenience we're providing by communicating [with customers] on their channel of choice. From a strategic perspective, our goal is to mitigate the volume from crossing over into our traditional service channels such as voice and chat. Neutral contacts (shipping, tracking, returns, exchanges) can be handled with a similar approach that we've taken to e-commerce self-service. Transferring this contact volume to a bot is a win-win for the consumer and TechStyle. Quick, efficient, real-time support, 24/7."

It seems there is one article after the next released on these subjects. There are countless APIs, plugins, software development kits, subscriptions and cloud based solutions already built to maintain these forward moving customer services initiatives. Meanwhile, it seems less than 10% of businesses confirm that AI currently plays a regular role in their customer service programs. However, reports have indicated that more than 30% of online based businesses have begun experimenting with customer-facing AI trials or pilots. Clearly the interest and development on all front will continue to grow!

Now, keep in mind - the two fundamentally different types of chatbots:

1. Functions on a set of rules. A very limited bot. It only responds to very specific commands. If you say the wrong thing, it does not know what you mean. This type of bot is only as smart as its programmed (rules) dictate it to be.

2. The more advanced version using machine learning. A continuously smarter bot as it learns from conversations it has with people. This system has an artificial brain AKA artificial intelligence (AI). It does not need you to be very specific, as it understands more natural languages as opposed to just commands.

Building these types of environments can sound daunting, but in reality it's totally doable. The difficulty in building a chatbot is perhaps less of a technical issue and more of a user experience challenge.


"The most successful bots will be the ones that users want to come back to regularly and that provide consistent value." 

-Matt Hartman, Director of Seed Investments at Betaworks

Foremost, it will be imperative to figure out what problem you are going to solve with your bot, choose which platform your bot will actually live on (ie. Facebook, Slack, etc), set up a server to run your bot from, and choose which service you will use to build your bot.

Fortunately, there are some really amazing companies forging the way for the future of these platforms. Here in our Austin backyard alone there are several we could name. Nevertheless, it is such an exciting time to be moving forwards amongst technological advancements today.

We hope that you will come back and join us again soon as we delve further into the future of customer service.

What's captured your eye lately in this quickly evolving realm? Let us know your thoughts by leaving a comment in the chat below!

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