The Advantages and Disadvantages of Employing Chatbots for Your Business

Since the beginning of mankind, those with access to better tools have had the edge over others. Earlier it was about surviving in the wild. Now, it is more about being the no.1 in the market. It is 2019, and most brands are leveraging advanced technologies to boost their business and get ahead of their competition. A chatbot is one such innovative piece of tech that has the potential to revolutionize online marketing experience for a brand.

A chatbot is an AI-powered software that answers the users’ generic questions using information in the form of templates. It functions as an optimizer for a customer service. In the past few years, there has been a significant increase in chatbot use. Before you consider investing in this sophisticated piece of technology, let us have a look at the pros and cons of using chatbots.

Pros of Using Chatbots

Bots Can Offer Personalized Experiences:
Chatbots are designed to be smart. They use machine learning to profile the habits and behaviors of a user. This allows them to deliver personalized information to the users. In addition, bots can help you to know your customer better. However, you need to ensure that you are gathering the right analytics from the bots.
Chatbots are also great at targeting the right audience and adjust to their specific needs. Bots can make prompt suggestions, and boost user experience to the next level.

According to Venturebeat.com, Facebook messenger currently hosts over 100,000 chatbots. It can be implemented in personalized corporate accounts on other social media platforms as well.

Chatbots Deliver Instant Support:
One of the major advantages of chatbots is that they deliver prompt and targeted support. Their response to a user’s demand is instant. It is a no-brainer that it can accelerate the communication process and boost sales. It is a win-win situation for both the customer and the brand.
For news companies, integration of chatbots can be extremely beneficial. When the hot news breaks, the bots can share it with the users immediately. By outrunning the competitors, bots can help the news company earn more credibility among the users.

Bots Are Active 24×7:
It does not matter what business hours you operate in, Chatbots can attend your customers 24×7 without taking breaks. Another great thing about them is that they can work on a number of requests simultaneously. Even if your business does not offer 24-hour support, your customers can still gain access to the information using chatbots.

Sprout Social’s Q2 2016 Index suggests that most brands take 10 hours to respond. However, an average customer expects to get a response between 0-4 hours. Chatbots can reduce the average response time, and meet the customer’s expectation. It means, if you are a student who wants to hire a research paper writer online, you don’t need to wait half the day for a response.

Chatbots Are Cost-Effective:
As of now, it has not been possible to set up customer service without human participation. However, the introduction of chatbots has already cut costs of maintaining customer service up to 29%. According to a post published in OurSocialTimes.com, developing chatbots is more cost-effective than developing mobile apps. Chatbots can be a great help to small businesses that cannot afford to have a customer service department.

Cons of Using Chatbots

Not Suitable For Every Business:

Chatbots can be quite beneficial for business organizations that provide services. It is easier to design accurate and cheap bots for businesses like taxi services, retail, travel companies and pizza delivery services. However, B2B companies, whose clients’ support offer comprehensive consultations cannot use chatbots to serve the clients.
As of now, chatbots are programmed to answer to templated questions. Improvisation is not a strong suit for chatbots. For B2B businesses, human-to-human interaction is the only effective way to provide customer support.

Some Chatbots Show Poor Customer Retention:

Till 2016, most chatbots could not assist users further than the first two messages. A post from Chatbots magazine elucidated that around 25 percent of users would drop off after the second text, while 40 percent of users never passed the first one. Even though the numbers have improved in the past few years, the issue persists.

Poncho, a weather app, managed to break this statistic and showed positive retention. Although the app was shut down in 2018, it revealed that businesses are yet to explore the capabilities of chatbots to the fullest. A/B testing can be a great way to learn what works best for a company.

Limited Number of Users:

According to Kik statistics, 60 percent of the people who use chatbots are teenagers. Also, 81 percent of the total chatbot uses are from the US. So, even if most businesses want to integrate chatbots to their customer services, they aren’t ready to serve customers of all demographics.

You might have to analyze your product and your target audience before you can consider chatbots for marketing and customer support strategies. It may still require some time to get proper audience response for chatbots.

Chatbots Are Susceptible to Errors:

Chatbots have trouble to go off-script. While it is getting faster and more precise in delivering customer support, it continues to get confused at specific user requests. Since bots cannot improvise, they fail to deliver the necessary support.

In addition, chatbots can also lose track of the conversation and go off topic while engaging with a customer. Since they don’t understand sarcasm, the machine can be easily bewildered. Microsoft’s Tay is a good example that shows to what extent chatbots can go wrong.

Being said that, chatbots have great potential. Companies can make strategic use of chatbots in the field of customer service. However, it will be a wrong decision if one invests in this tech just because it looks fancy. You need to understand its functions, and create a strategy to implement it in your customer support operations. Since chatbots will deal with the customers directly, one wrong move can ruin the reputation of your business beyond repair.

Summary:

Chatbots can add a lot of value to your business if used strategically. They can deliver accurate, instant and personalized support at a low cost. However, they are not 100% perfect. They are vulnerable to errors and not suitable for every type of business. You need to weigh the pros and cons before incorporating the tech into your business.