Chatbots emerging as a commerce channel, but work remains to perfect the tech

9. October 2017.

Ted Livingston, co-founder and CEO of messaging app Kik, has made some profound statements over the past few years about the future of services like the one he helped start in 2009.

As messaging platforms such as Kik, Facebook Messenger and WeChat have become more popular in recent years, Livingston has turned his attention to a growing feature within those services: the chatbot, a virtual assistant consumers use to complete simple tasks.

“Chat is going to be the next great operating system,” Livingston wrote in a Medium post last year. “Apps will come to be thought of as the new browsers; bots will be the new websites. This is the beginning of a new internet.”

Whether Livingston’s words are prophetic or a way to hype Kik’s importance among messaging services remains to be seen. But there’s no denying the discussions happening today about chatbots. They include chatter about artificial intelligence, conversational commerce and voice assistants such as Amazon’s Alexa and Apple’s Siri.

So, what exactly are we to make of chatbots in 2017?

“They haven’t reached their peak yet,” Ryan Craver, senior vice president of emerging brands, licenses and digital strategy for Lamar Group, said during a panel discussion about chatbots at last month’s fourth annual CONNECT: the Mobile CX Summit.

“Right now, we’re at a place where we’re thinking about where to use them and how we will have consumers use them because most [consumers] still aren’t aware of chatbots or how to use them correctly,” he added.

However, that is slowly changing in the U.S. And that’s mostly thanks to Facebook.

Earlier this year, the social media giant introduced Messenger Platform 2.0, “a new suite of tools that gives [software developers] the ability to build richer experience, get discovered, and extend the conversational, visual and social capabilities of bots.”

Financial services company took notice of Facebook’s efforts as MasterCard, MoneyGram and Western Union individually announced their entry onto the platform at the Facebook Developer Conference in April.

For MasterCard, which has been keen to get itself involved in products and services that could benefit from digital payment credentials, the Messenger involvement included a partnership with Subway to enable consumers to place orders via the messaging service using a chatbot.

Ken Moy, former vice president of digital at Subway, also participated on the CONNECT chatbot panel and provided attendees with unique insight into how chatbots can enhance a customer’s buying experience yet also present challenges to the merchant to provide something easy.

“In general, I think the whole universe of bots is nascent, but I also think it’s different depending on what the use case is you’re looking for,” Moy said. “My argument would be that most of the applications that we see today [for chat or voice assistants], either going through Alexa or Google Home, are simple and that the information is fixed. That’s a challenge for someone like Subway.

“We have at least 20 different sandwiches, and by the way, you can throw in different veggies, sauces and add a drink, chips or a cookie. How do you actually guide someone through that experience because that’s a huge value proposition for Subway.”

Moy said that gets accomplished through “a lot of programming, a lot of scripting and this is where artificial intelligence comes into play because you need to interpret the intent of what the customer is saying, validate that intent and make sure you have enough information to fulfill that intent.”

While Craver and Moy both agree about the chatbot’s lack of maturity in the market, they differ when to came to the technology’s “hype.”

Carver first reminded the audience that today’s conversation about this new wave of commerce needs to be viewed in two separate categories. Then he went into his issue with how chatbots should be viewed today.

“The majority of use cases [for chatbots] that we’re seeing is, where is your store, where do I get your product, what are your shipping costs and where is my order. That is the chatbot today,” he said. “On the voice side, if you look at how people are using Alexa and Siri today, it’s setting alarms, setting timers, maybe opening an app [Uber of OpenTable].

“All of these use cases are being talked about by brands and they’re developing those use cases, but it’s [expletive] because no one knows how to use it. To me, that’s hype.”

Moy revealed a more optimistic outlook based on what’s been seen in the past with other platforms once viewed as emerging technologies.

“It’s an emerging channel for commerce,” he said. “It wasn’t too long ago that the internet was an emerging channel for commerce. It wasn’t so long ago that the mobile device was an emerging channel for commerce. To me, this is still emerging. We just need to figure out where the cars are that go on this highway.”

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