How to Use Chatbots to Best Serve Your Business

Chatbots are no longer the new thing in technology. In fact, chatbots have been around since 1966—22 years before the Internet was invented. The first chatbot created, ELIZA, was developed at MIT and answered simple decision tree questions. 

The application of chatbots has evolved into using more machine learning and artificial intelligence (AI), creating increasingly complex decision trees that move in more than just one downward direction. These AI bots are capable of moving in multiple directions at the same time to determine context of the user’s language and then choose the best answer to provide the user.A decision tree is a decision support tool that uses a tree-like model of decisions and their possible consequences. [1]

Myth #1: People Don’t Like Using Chatbots

While this may have been in the past, users today expect a chatbot option as a form of communication from all kinds of businesses. A study conducted by Mobile Marketer showed 40% of people aged 18-34 use chatbots daily. [2] They have been integrated into our everyday lives enough that users trust them with personal information and expect to be helped immediately.

The reason this myth is widely believed is because businesses often program their chatbots to sound and feel like live human interaction. Customers feel misled when it becomes apparent that it is, in fact, just a chatbot. 

Recommendation: Always be transparent with your customers when you are using a chatbot verus live chat with another person.

Myth #2: Chatbots are Only Useful in E-commerce

Chatbots are not just for online retail shoppers looking for the best product. There is a use for chatbots in every industry from retail to banking, real estate, healthcare and more. Users want any chatbot that will help them accomplish their goal.

  • More than 28% of real estate businesses use chatbots. [3]
  • 43% of those who use online banking prefer chatbots or live chat to address their issues. [4]
  • By 2021, 50% of companies will spend more budget on chatbots than on traditional mobile apps. [5]

Every industry is capable of using chatbots; they just have to be programmed to help your customers complete specific actions to their satisfaction.

Recommendation: Know your audience. Analyze their needs and commonly asked questions to determine how a chatbot could help improve your overall customer satisfaction and subsequent revenue.

Myth #3: AI is Self-programmed

No chatbot is built the same. There are two different approaches to take when building a chatbot:

  • Rule-based chatbots: powered by a series of rules developed like a flow chart going from one answer to the next. 
  • Intelligent chatbots: powered by machine learning and AI to analyze and understand the user’s context before formulating a response.

Many think the intelligent chatbot approach is easy, believing the computer does all the work. That is not entirely true. While you won’t need an entire IT team to build and maintain your chatbot, artificial intelligence needs human input as these AI chatbots left on their own are incapable of developing and creating the equations and signals to understand the context of human language, such as emotion (for example, an angry customer). 

Recommendation: Create your own decision tree and determine how your chatbot can help your target audience best. 


Sources: [1] [2] [4] [3] [5]

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