November 23

Chatbot Marketing: Deepening Customer Relationships & Driving Sales Through Conversation

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There’s no question that the general customer experience has evolved in the last few years. More and more consumers choose to shop online, using social media and mega e-commerce platforms like Amazon to find and support brands that meet their unique needs. Furthermore, thanks to the increasing prominence of chatbot marketing, customers can interact personally with brands, leading to positive experiences, greater brand loyalty and longer retention.

Customer Relationships Are More Important than Ever

Every marketer knows the importance of achieving customer satisfaction, but how many strive to go beyond it? Customer delight is a relatively unheard of concept that translates into longer customer retention and brand loyalty over time. 

The value of attracting the right customers, engaging them with a compelling, need-based array of interactions and, finally, delighting them enough to inspire long-term loyalty cannot be overstated.

  • • It costs brands six-to-seven-times more money to attract a new customer than to retain an existing one.
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  • • A reduction in customer churn of even 5% can boost profits by 95%. 

  • • Brands spending time and money on risky or irrelevant leads waste resources on exploits that don’t bring in any revenue. 

Once you piece together the importance of developing relationships with your customers, your brand will start to achieve three following critical results:

1. A Host of Loyal Brand Advocates

A loyal customer will be more forgiving of a brand; in a report from PwC, only 17% of devoted customers say they would terminate their relationship with a brand after one mistake. Someone who develops a genuine, emotional connection with a brand will behave more like a friend than a customer. More than half of loyal customers use emotional terms like “love” when describing their favorite brands.

2. More Customer Referrals

When a customer feels emotionally connected to a brand, they’ll be inspired to recommend it to friends and family. According to a report from Extole, 84% of people say these referrals are the most trustworthy form of brand recommendation. Furthermore, referrals comprise 20–50% of purchasing decisions, and relationship marketers say the lifetime value of a referred customer is 16% higher than that of a non-referred customer. All of these figures state that engagement leads to trustworthy referrals — practically free marketing for brands. 

3. Cheaper, Faster Customer Acquisition

Finally, when a brand’s initial interaction with a lead is personalized and responsive, it’ll see a greater return on investment. Once a customer experiences genuine delight, they’ll become compelled to try new products, fill out customer surveys and share honest feedback with a brand.

A Bespoke Customer Experience

Recall the old-school way of shopping. For example, at a high-end boutique, a customer is welcomed by a greeter, guided through the departments by a knowledgeable staff member and given specialized assistance at every stage of the purchasing journey. 

This personalized approach is a far cry from the typical online shopping path, where customers are expected to be self-guided and informed from the onset. You have the opportunity to shake up the norms and provide potential and existing customers with long-lasting engagement reminiscent of old-fashioned customer service.

Chatbot Marketing: A New Way to Converse

Now that we’ve established the importance of developing strong customer relationships let’s dive into one of the most promising means of achieving them: chatbot marketing.

Conversational Marketing Is on the Rise

Chatbot marketing is a relatively young technology that is steadily growing in usage. A LiveWorld study found that 40% of marketers call for the expansion of digital marketing to include conversation between customers and brands. This enthusiasm traces back to 2016 when Facebook announced it would start to integrate third-party chatbot messaging into its Messenger platform. Today, the top messaging apps are Facebook Messenger, WhatsApp and WeChat. Each of these represents the opportunity for brands to launch a chatbot.

Chatbots Offer a Wide Range of Possibilities

The capabilities of chatbots are vast; they can be the vehicle for launching promotions and making sales. They can initiate customer feedback conversations, and they can be the landing zone for customer service issues. 

Consider some of the fundamental use cases of a chatbot:

  • • Processing and tracking orders

  • • Updating order information

  • • Collecting and providing shipping information

  • • Responding to pre-sale inquiries 

  • • Providing post-sale information, like receipts

  • • Scheduling reservations and appointments

  • • Offering promotions, discounts or rebates

  • • Collecting customer feedback

  • • Responding to complaints, issues or concerns

  • • Providing round-the-clock customer engagement

  • • Notifying customers about important reminders or events

In some of the above cases, the chatbot conversation will be triggered by a customer’s action. For instance, when a customer makes a purchase, a chatbot can initiate a follow-up conversation that includes the order confirmation, receipt and tracking information. In other scenarios, the chatbot can begin the discourse. It might inform customers of a new product, suggest a similar product based on a customer’s purchase history or ask for feedback about a previous order.

Chatbot Conversations Can Be Received Individually or Disseminated En Masse

Suppose you want to let customers know about a time-sensitive discount or a change to company policy. In that case, the chatbot can convey the relevant information in one sweeping send-out of messages. On the other hand, a chatbot can engage in a unique, personalized chat with one customer regarding their specific order. 

Chatbot Marketing Is a Powerful Conversational Tool

Because chatbot marketing is highly customizable, it has the power to respond to an array of customer needs. According to an article from Retail Customer Experience, in 2019, 67% of consumers had used a chatbot at least once; this number will only increase as brands invest in personalizing their relationships with their audiences. The same article projected that soon, 30% of customer service experiences will be handled by a chatbot.

This begs the question: why is chatbot marketing so effective? How can brands take advantage of this new tech to develop an authentic understanding of their customers?

How Chatbot Marketing Deepens Customer Relationships

When thinking about why chatbot marketing works, reflect on your experience with AI and messaging platforms:

  • • How often do you open Facebook or WhatsApp?

  • • How many instant message chats do you have on the go?

  • • What do you find more compelling to open: a direct message targeted to you or a generic, scheduled email newsletter? 

Chatbots Go Where the Customers Are

If you find yourself giving a lot of your time to social and messaging platforms, you’re not alone. 

  • • Most people spend 80% of the time using their smartphones on just their top three apps.

  • • Since Facebook Messenger sees 1.3 billion monthly active users, it’s safe to say that Messenger gets a lot of consumer attention.

This means that a messaging platform, be it Facebook or WeChat, is already a prime location for engaging with customers. A brand doesn’t need to hit the ground, trying to find out where its customers are coming from; it can simply turn to the spaces where customers are already spending their time. Brands can, therefore, spend less time hunting for leads and more time investing in the quality prospects before them.

Another huge benefit of using chatbots is that they can utilize customer data on the chosen messaging platform. Brands have access to such insights as 

  • • Age

  • • Gender

  • • Location
  •  
  • • Buying history
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You can launch chatbot messages so that only the customers with the greatest potential to buy a specific product will be targeted. 

Chatbots Deliver Delight

The real value of chatbot marketing lies in its ability to relate to customers. Chatbots use natural language to connect to their audience. They can interpret questions to provide relevant answers, or they can simply offer fun, engaging dialogue to make customers feel excited about their purchase. In a way, they behave like friendly AI technicians, responding to their real-life users in real-time, using language infused with personality.

The statistics behind this concept are compelling:

  • • Retail Customer Experience suggests that when customers interact with a well-optimized chatbot, 80% report having a positive experience.

  • • Plus, while e-mail open rates sit around just over 20%, chatbot messages see an open rate of over 80%.

  • • Finally, according to a report from Business2Community, the vast majority — 79% — of consumers say they’d be willing to converse with a chatbot for customer service purposes.

Much of the feedback from customers in response to using chatbots centers around their need to feel heard and appreciated. Once a brand makes a customer comfortable using a personalized, friendly chatbot message, they switch cognitive gears. They suspend more strategic, rational decision-making and start to favor more emotional impulses. This is when they start using those terms of endearment mentioned above, “love” and “adore,” to describe the consumer’s deepened relationship with a brand.

The perks of chatbot messaging are readily apparent from the customer’s perspective:

  • • 24/7 availability means customers can get help at any moment, rather than waiting for a help desk technician to get around to their inquiry

  • • Personalized, data-driven responses bring the most relevant information to target customers

  • • Strategic scheduling means chatbots can engage with customers at the most opportune time to make a sale

  • • Platform integration ensures customers don’t need to install a new app or leave their social media pages to receive help

All of this contributes to the ability to instill customers with delight. Brands are seen as providing timely, relevant and targeted assistance; customers’ needs are met and then surpassed through authentic communication.

How to Optimize Chatbot Marketing for Your Brand 

By now, it should be clear that customer delight translates to greater sales, longer-lasting loyalty and the ability to garner leads. This doesn’t mean, though, that marketers can boot up any chatbot software and start seeing these rewards. In part, because this technology is still new and the underlying need to develop a personable rapport with consumers, brands must seek to optimize their chatbot marketing usage.

Maintain the Human Element With Chatbots

While chatbots do have the computing power to carry out a robust discourse with customers, they shouldn’t be viewed as a whole-cloth replacement for human interaction. Many customers might encounter the same product issues, for instance, and in these scenarios, a chatbot will be equipped to offer a resolution. However, in situations where a user needs more specific attention, chatbots should merely receive a customer’s request for service before passing the issues to a person on the company’s team.

With this human aspect in mind, brands should work with chatbot services to program bots that implement natural language processing (NLP). A brand’s chatbot should be able to handle the majority of typed or spoken inquiries based on real-world phrases and questions. This also necessitates a high-quality copywriter who can think like a customer would to optimize the chatbot’s functionality.

Chatbots should therefore maintain a person-to-person approach by:

  • • Transferring complex customer issues to a human-operated service team

  • • Scheduling a future call with a company representative

  • • Setting reminders for customers about future calls

  • • Following up with customers after the in-person meeting

Diversify the Chatbot Experience

Customers are perceptive; they’d be quick to notice if a chatbot’s language is too similar to other forms of marketing from a brand or if the chatbot reiterates information they’ve already encountered. When this duplication happens, customers are prone to reverting to strategic thinking, forgoing their valuable emotional responses; they’ll once again feel like a consumer, where before they felt like a friend.

  • • To control for this kind of switch, you should ensure that their chatbots offer a novel narrative to customers.

  • • Successful chatbots employ a lighter, personal tone than the typical advertisement and frequently engage with customers on matters that aren’t directly tied to making a sale.
  •  
  • • A chatbot might even share a quick message of hello or post a feel-good image in the customer’s chat. Not all actions by the chatbot need to be sales-oriented.

Invest in Chatbot Marketing Experts

Chatbot prominence is rising, which means so are the number of services and agencies that can program them. This means brands are faced with a wide selection of companies to choose from when implementing chatbot marketing. 

You should consider your brand’s specific goals before committing to a chatbot agency. 

  • • Is the intention to use voice command or text-based messaging?

  • • How do you want to view and interpret customer insights?

  • • What bot-to-person capabilities should the chatbot be able to accomplish?

  • • Which messaging platform makes the most sense for your brand? 

Considering the answers to these questions through the lens of budget and technical experience will guide you towards the best chatbot agency for your needs.

Finding Opportunity in Chatbot Marketing

Regardless of your brand’s size,  you should consider the promising opportunities inherent to conversational marketing expressed through chatbots. There’s a reason why, according to LiveWorld’s study, more than 40% of Fortune 500 companies are implementing a chatbot marketing strategy. These brands demonstrate an understanding of the importance of a meaningful customer relationship and strive further to deepen them through the optimal use of a chatbot.

Finally, since the demand and funding for AI in e-commerce are increasing and online shopping in response to COVID is becoming more important, now is the time for you to develop a chatbot strategy for your brand. Building out a chatbot now means you can get ahead of the curve, building critical customer relationships before the competition does. 

For more information about chatbot marketing and to start making sales and building customer relationships with your chatbot, please visit The Chat Agency's official website.


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