The future of commerce is undoubtedly conversational. Regardless of size, brands have prioritised conversational experiences by incorporating them into their communication strategies.
Now more than ever, brands look for ways to automate customer communication while keeping a human touch in every interaction.
By creating conversational experiences, brands meet the expectations of the modern customer and offer convenient and fast resolutions to queries. For example, the adoption of chatbots has helped customers get their FAQs answered instantly and keeps satisfaction scores high.
But brands need to keep in mind that conversational experiences shouldn’t stop at customer support. They can now engage with their customers through their entire sales journey over messaging channels. This is referred to as conversational commerce, and it’s a game changer for brands looking to innovate experiences.
But what is conversational commerce?
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A term coined by Chris Messina back in 2015, conversational commerce largely pertains to utilising chat, messaging, or other natural language interfaces (i.e. voice) to interact with people, brands, or services and bots that thus far have had no real place in the bidirectional, asynchronous messaging context.
Seven years in, with the aid of new technologies, conversational commerce has an updated look and feel for 2022 to address the ever-evolving customer needs.
What is the hype all about?
As messaging and interactivity functions mature across all digital touchpoints, be it powered by humans or machine learning, conversational commerce is seeing a renaissance.
Consumers can now ask for support from a live agent or a chatbot, get information on products and pricing, browse product catalogues, get personalised recommendations, and make purchases all within one conversation.
Opportunities are endless with conversational commerce as it gives a highly personalised experience. According to McKinsey, 71 per cent of customers expect relevant, personalised communications from brands and get frustrated when they don’t receive them.
The same study has found that personalisation directly impacts buying behaviours. Brands have started to recognise the importance of the customer’s journey and how conversational commerce outweighs social commerce in some areas.
As social commerce primarily uses the functions of social networks, it has its own set of limitations that conversational commerce can address. Typically, conversational commerce facilitates a more natural and seamless conversation between brands and their customers.
Customers’ queries are attended to in real-time, and orders and payments can be made without leaving the app, which leaves customers engaged throughout their shopping experience.
Reaping the benefits of limitless communications with customers
Conversational commerce is what customers look for when shopping today. They expect the convenience and comfort of conversing with brands through their favourite chat apps from any location.
Implementing conversational commerce use cases is not only beneficial for your customers but comes with massive business benefits for brands. Limitless communication with customers drives several business outcomes, including:
- Reducing shopping cart abandonment: Conversational commerce ensures that every step of the customer journey is elevated – from pre-purchase and purchase to post-purchase. Shopping cart abandonment is reduced when customers are kept in an active conversation, unlike on social media, where the use of ads is prevalent, customers get impatient and change their minds about their purchases.
- Retaining customers vs generating new leads: While social commerce has its strength in reaching out to the targeted audience, it does not guarantee a conversion. Conversational commerce, on the other hand, has the power to retain customers because the interaction that takes place offers convenient support leading to a pleasant and happy experience. Did you know it also costs seven times less to retain customers than to convert a lead?
- Upselling and cross-selling opportunities: Using target customers’ favourite chat apps as a sales channel is a great way to promote products. On average, customers spend approximately 38 minutes a day on WhatsApp, which means marketing messages will get the visibility they need to land impact when sent on the right channel. By leveraging past behaviours, shopping habits and interests, companies can send relevant products and services or upgrades on plans or memberships that will meet their needs.
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Several companies have utilised conversational commerce to the fullest, resulting in growth, as seen with Bajaj Auto in India.
This automotive manufacturing company saw its conversion rates double and engagement boosted by 133 per cent just by adding WhatsApp and RCS (Rich Communication Services), an upgraded version of SMS with branding, rich media, interactivity and analytics delivered through default messaging apps, to its communication stack.
Bajaj Auto sought out communication channels that would let them meaningfully engage with customers instead of sending out transactional, one-way communication.
What’s next for conversational commerce?
Conversational commerce will continue to shape how consumers and brands interact with one another as emerging technologies such as AI push the boundaries, delivering automated messages that can be more timely, tailored, and cost-efficient.
Innovation in conversational commerce will drive new consumer demands that brands need to prepare for. In the coming years, organisations can expect to invest in analysing consumer habits, capture pre-purchase journeys, and strategically retain human touchpoints within their customer journey map. This is especially so as the modern customer journey is non-linear.
This new era of conversational commerce presents opportunities for brands to humanise their voice. By actively listening and engaging the customer from the start of their purchase to when their package arrives at their doorstep, it brings companies closer to their customer and forms meaningful connections with them, getting them to the top one message at a time.
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