The global chatbot market grew from $113 million in 2015 to $703 million in 2016 and is projected to grow in value to $1.23 billion by 2025, according to Grand View Research. Analysis of consumer perceptions and usage of chatbots has revealed that by 2019, 25% of the world’s population (or 1.75 billion people) would be using mobile messaging apps. A late-adopting South African market is suddenly catching on to the opportunities chatbots present in customer communication.
“In the next 10-20 years, 58% of financial advisors will be replaced by robots and AI” – Frey and Osborne, Oxford University.
To give an idea of this swift adoption, 96% of businesses believe that chatbots are here to stay, and 67% believe that chatbots will outperform mobile apps within five years. This has led to 80% of businesses stating that they either already have chatbots in operation or they plan to have them by 2020. To allay concerns that the market will share this shift in doing business, 47% of customers said they’d buy items from a chatbot. In fact, the 26-36-year old market segment said they’d spend up to $675 via a chatbot interaction.
Despite companies offering a wide range of interaction options within a multi-channel contact centre environment, according to this research, consumers are favouring chatbots: 48% would rather connect via live chat than via any other form of contact. Your marketplace is both getting used to this form of interaction and expecting it to be available.
The benefits in brief
The primary sectors making use of chatbots currently are online retail, healthcare, telecommunications, banking and financial services, with consumers saying that they treat chatbots like health care coaches, travel agents, tutors and advisors, with these roles being frequently performed by human agents in contact centres until recently.
An example of the cost savings that are achievable by implementing a chatbot would be in the case of the Autodesk Virtual Agent enabled by Watson Communication: the chatbot reduced the per-query cost from $15 – $200 to an average of $1. Since chatbots can function 24/7, this is of great benefit to the company.
A further consideration relating to time spent on interactions also translates to productivity and profitability: according to research, time saved per chatbot interaction compared with a traditional contact centre interaction is four minutes. Translated into cost savings, in the banking and healthcare sectors alone, this is projected to save $8bn by 2022.
What about the humans?
The contact centre sector is a major employer in South Africa, so the challenge posed is whether or not the implementation of chatbots will effectively see job losses, but the general response from the industry is that this won’t necessarily be the case. 61% of customers say that chatbots won’t replace humans completely, although 31% said that they will. What is important to consider is that there will always be complex processes within a business that require human involvement – interactions that require human qualities such as insights, reasoning or empathy. Although a chatbot is capable of performing and automating some tasks and processes, the technology will also free up humans to perform other more complex tasks that depend on human strengths and qualities to achieve success.
Information at your fingertips
Beyond servicing basic customer queries, chatbots can also be integrated with business systems to not only answer generic knowledgebase questions (relating to products or services, for instance) but also provide customers with specific personal information and feedback. For example, a customer may engage with a chatbot from a financial institution to find out if they can extend their credit limit by a specific amount. After asking some identity verification questions (such as ID number), a chatbot that is integrated with other business systems can provide this information to the customer immediately – no phone call or branch visit required.
In the contact centre environment, chatbots can also be used to assist employees resolve queries more efficiently. Agents can dynamically engage with a chatbot during a customer call to get answers, effectively shortening resolution time, and reducing the workload on supervisors.
The reality is that this technology is gaining a foothold across the board, with businesses constantly identifying new ways to leverage its benefits. There will always be customers who prefer to interact with a human, but that is not to say that chatbots can’t work effectively alongside human agents to deliver service excellence in contact centres.
By Wynand Smit, CEO of INOVO