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6 Costly Misunderstandings about Chatbots and Amazon Alexa

Retailers are facing a raft of challenges this quarter. Amazon capturing more than half of total online retail growth, customers spending 88% of their time in only 5 apps, and customer acquisition costs skyrocketing. It’s understandable some are considering selling the farm, and others are quietly fading away. For those still in the fight, ChatBots and conversational commerce channels are a hot topic of debate — it’s difficult to go a single day without stumbling on some kind of new report — and for good reason. But many are feeling concerned about some fundamentals of the platforms, and how they operate.

Misunderstanding #1

If we build a bot, we have to hand over control of our branded Facebook channel to it.

The Truth You can retain control over your branded Facebook Messenger experience, and be very selective about the interactions you want a bot to handle. You may want to start with a ChatBot only handling returns and exchanges, or with your ChatBot only handling frequently asked questions.

It is up to you — there’s no need to ‘hand the keys’ over and have a ChatBot drive every interaction.

Misunderstanding #2

We can only have 1 ChatBot on our Facebook Messenger channel.

The Truth While it is advisable to start with one ChatBot, in order to learn and test effectiveness, you can absolutely have more than 1 ChatBot running on your Messenger channel. For example, you can run a ChatBot that handles FAQs and another ChatBot that handles returns and exchanges.

Deploying a ChatBot to Facebook now does not leave you stuck for the future, nor does it mean you need to build or find a ChatBot that handles a wide range of customer scenarios today.

Misunderstanding #3

Our new ChatBot needs to handle all the inquiries that a customer sends our way.

The Truth Your new ChatBot does not have to handle all kinds of customer inquiries, and it also does not have to handle customers without human assistance. The ChatBots that work best are those which have very specifically defined skill sets, and which are built to be aware of their boundaries.

Facebook Messenger bots can live in harmony with human agents, and indeed with community management platforms like Lithium or Sprinklr. ChatBots that are built well (or deployed through a platform like Linc) have very clear boundaries on what they are capable of doing, and will hand off customers to real people if they see a customer’s message is not within their scope of skills.

For example, a customer asking ‘Can I return my blue shirt’ on Messenger will be handled by a ChatBot who has a returns-management skill set. The ChatBot can look up the customer’s order details, confirm the correct item for return and prepare a shipping label for the customer, in real time and without human intervention. If a customer says ‘I’d like to change my billing details for my order’, a ChatBot that doesn’t cover these kinds of inquiries will hand the customer off to a human agent, who can help the customer as per usual.

Misunderstanding #4

We need to sell our products on Amazon in order to make use of the Alexa platform.

The Truth This is a common misconception and is holding many retailers back from launching a customer service skill on Alexa. With over 10 million Echo devices in homes today, and another 25 million due to arrive this year, Alexa’s platform represents an emerging channel that consumers are adopting due to its convenience.

The reality of the Alexa platform is that there is absolutely no need to be selling products on Amazon’s marketplace in order to interact with your customers. More importantly, your customers can order directly from you through your branded Alexa skill, without your products being available on Amazon’s marketplace, and without your customer having Amazon Prime.

Misunderstanding #5

If we use Amazon Alexa, Amazon gets our customer data!

The Truth In a simple answer: Amazon does not get your customer or order data. While the Alexa platform is touted for its natural voice interactions, and intuitive AI, it is more helpful to think about a comparison with an IVR telephone system. The Alexa is more like a telephone handset, while the intelligence behind the conversation, including order details and customer details, are run on other systems and platforms, separate to Amazon’s infrastructure. In some cases, this may be built from the ground up, or a platform like Linc’s may be used to deliver both the AI intelligence, and the order lookup and handling processes.

Misunderstanding #6

ChatBots today are an experimental channel, and there is no real ROI to be seen.

The Truth If you ask around, most folks today see conversational channels as an early-stage, experimental area to consider. But the reality of business is that a channel that falls into that category is pushed to the side, in the interests of addressing more pressing needs and opportunities. Though some uses of ChatBots may be seen as branding experiments, or opportunistic grabs for media attention, there is a very real ROI to be had. Indeed, brands who have already deployed ChatBots for customer service are seeing instant cost reductions that return well beyond their investment. Beyond immediate cost-savings, using intelligent exchanges, recommendations and upsells will deliver in-quarter additional revenue, and reduce return losses.

The Most Costly Assumption

These misunderstanding may delay action, but there is an assumption that could cost you hundreds of thousands of dollars — the assumption that it’s going to cost a considerable amount of time and money to even experiment with ChatBots, and that in order to take the first step with conversational channels you need a long term roadmap before taking action.

The Truth Though it is wise to tread carefully with new customer-facing channels and technology, many leaders are shocked when they learn that there are already platforms available that can deploy a ChatBot and Alexa experience in less than 4 weeks.

Recommendations from analysts today are to start with a specific and narrow set of functionalities, in order to go live and start serving customers with satisfying and valuable experiences. Linc’s platform has commerce-trained AI, is built specifically for retail customer scenarios and uses pre-built integrations and system-agnostic data connections to avoid the common hurdles and challenges retailers experience when they work on a customer service ChatBot. Linc has helped over a dozen retailers launch Messenger ChatBots and Alexa skills in the last 6 months, and we have provided guidance on best practices while delivering instant cost savings and additional incremental revenue.

You can learn more about conversational commerce by exploring Linc’s platform and solutions pages. Or take a look at how leading brands like Lamps Plus, and others are using automated conversational commerce strategies in their businesses today, in our resources page.


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Designing a Customer Experience Strategy for Conversational Commerce

When you master conversational commerce, you’ll deliver experiences that make your customers feel as if you hired a personal assistant to help each of them.  There are several key strategies, smart brands need to think about as they go about creating their conversational commerce strategy. Don’t Forget The Data If conversational commerce is the new paradigm of customer experience, data is the engine that drives all those delightful interactions across touchpoints. Your customers are creating data every time they click, swipe, and like --it’s up to you to find it, analyze it and use it to inform customer engagement. Nordstrom, for example, uses sensors and Wi-Fi to track who comes to the store, wherein the store they shop, and how long they stay. They also incentivize their Nordstrom’s credit card and rewards program to gather data about their clients. Target is also known for its data-collecting. The mega-retailer assigns every customer a Guest ID number, which is linked to their credit card, name, or email address. This Guest ID number becomes a repository of info on a shopper’s past Target purchases and any demographic information the company has collected about them and/or bought from a third-party source. Target’s data is so accurate and fine-grained that they were even able to determine a teenage shopper was pregnant (and send her the appropriate mailer filled with baby items) long before her father ever knew. Collecting relevant data, analyzing it and using your learnings to inform which conversational channels make sense for your brand and what types of experiences your particular customers seek to have on them is the foundation of your conversational commerce efforts. Focus On The Highest-Value Activities Put your energy toward meaningful services that customers already care about. Look at service-oriented features, such as notification capability and on-demand service and support capabilities, to guide the customer journey. Don’t just focus on the “Checkout.” The main benefit of service-oriented conversational channel offerings is the ability to organically drive usage into new channels. For example, a customer might place an order on your website and learn that she can subscribe to order status updates through Facebook Messenger. What she sees as taking advantage of a perk will benefit you by encouraging her toward a channel where your chatbot can take over. ChatBots are best for organic conversations with common use cases, but also provide a sense of personalization and convenience for the shopper. Customer service should be your core use for this technology to start. Be Prepared For Bot-to-Human Handoffs The great thing about a conversation handled over text or Messenger is that the customer doesn’t have to know when they might be switching from a bot to a human. Bot design in the future will focus on what they can do, knowing what they can’t do, and designing a bridge to employee assistance that feels seamless to the customer. It’s not just the customer that will be helped by the bot, but the employee. It will provide faster information and better analytics in real time, perhaps then parsing information to pass on to the consumer. The most important aspect of innovation is convenience for the shopper. They should never have to explain their request twice. Start Simple and Grow to Brand Management You can start with bots as a single voice in the chorus of messages from your brand. The long term will have bots as representatives of your entire brand, managing relationships with your customers. You can start conversational commerce, however, with just a single entry point. You can get your customers used to interacting with you on the same channels they use to chat with their friends. You can piggyback on the culture of quick and informal communication, but be ready to meet their expectations for highly personal and meaningful results. If your bot can’t meet that expectation, your customer could walk away disappointed or annoyed. As the technology improves, and it is, even as we write this, you’ll be able to put more and more of your brand management in the hands of the bots. Authentication Giving your bot a way to confirm the customer’s identity is key to a truly intelligent communication that can leverage data from across your other channels. If this isn’t done right, your bot will see each customer as a stranger, negating the opportunity to provide personalized service. Focus On Concepts Rather Than Solutions Your customers might be on Kik today but head over to Facebook Messenger tomorrow. Focusing on the concepts of conversational commerce rather than today’s hottest medium will help you keep your sanity and provide an agile approach that can be applied to meet your customers wherever they migrate. Try not to get bogged down with the details of how to build for one particular channel, and look instead to use-cases. You can learn more about conversational commerce and engaging your customers at every touchpoint by exploring Linc’s platform and solutions pages. Or take a look at how leading brands like Lamps Plus, and others are using automated conversational commerce strategies in their businesses today, in our resources page.