The 618 Shopping Festival (falling on the 18 June) is China’s largest shopping extravaganza after Double 11. With presales that typically go live a month in advance, this festival marks a crucial opportunity for online merchants to showcase their offerings to a large consumer audience.
However, competition among retailers is fierce, with many businesses leveraging dynamic marketing tactics such as interactive campaigns, live streaming, and social media promotion to entice and engage new customers. The rapid advancements in artificial intelligence have further intensified competition amongst brands, where delivering excellent customer service is key to differentiating and sustaining brand loyalty.
For brands looking to enter China during this time, as well as existing local online merchants looking to cut through the noise, how can they drive sales and stay ahead of the competition for this year’s 618? Can AI-powered chatbots really make a difference to a company’s revenue stream?
The rise of AI-powered chatbots
Customer service chatbots, often powered by AI, have emerged as a game-changer in the world of customer experience at all stages of a sales funnel. These chatbots offer 24/7 service, personalised interactions, and efficient problem-solving capabilities i.e. responding to queries, processing orders, customising offerings and handling returns.
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Chatbots can also handle a large volume of customer inquiries simultaneously in a timely fashion without compromising the quality of service, which is particularly beneficial for small business owners.
According to an MIT Technology Review survey, nearly 90 per cent of businesses report that they have recorded measurable improvements in the speed of resolving complaints. These gains in customer satisfaction in turn improve revenue performance and customer lifetime value.
According to Verint’s 2023 State of Digital Customer Experience report, 31 per cent of consumers have higher customer service expectations than last year. More worrisome is that 69 per cent have stopped doing business with a company due to a single poor customer experience.
As e-commerce merchants increasingly adopt AI-driven technologies for customer service, maintaining a consistent and authentic brand voice across customer touchpoints has become more and more important. Generative AI models, such as large language models (LLMs), have revolutionised the way chatbots can be trained to reflect a brand’s distinct personality and voice.
By infusing these models with brand-specific guidelines, tone, and language, brands can develop chatbots that seamlessly embody their brand’s identity, ensuring a cohesive and authentic customer experience across all digital channels. Additionally, it could avoid the use of inappropriate language or content and maintain a level of professionalism and trustworthiness.
For example, H&M uses a generative AI chatbot on their website that can reduce response times by up to 70 per cent over human agents. Euromonitor International’s customer experience report found that 56.2 per cent of consumers in China responded that they used voice assistants in 2023 while making purchases.
The chatbot not only helps shoppers search for specific products but also answers FAQs and helps with orders, providing an easier and more satisfying experience for customers while significantly reducing the load on its customer service team.
Do more with less with next-gen chatbots
Leveraging chatbots to take customer experience to the next level comes at a critical time. Customer engagement has drastically evolved over the past few years. Interaction volumes are increasing while customer expectations are skyrocketing.
Meanwhile, brands are trying to do more with less to respond to rising customer expectations and deliver incredible experiences.
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A key aspect of solving the CX-cost equation is being able to scale interactions without drastically increasing budgets or reducing the quality of customer engagements. The Verint study reveals that 45 per cent of highly confident respondents currently share work between human employees and bots.
And 72 per cent of highly confident respondents indicated that utilisation of chatbots and messaging channels has been extremely effective for them during the past two years.
Steps in building an AI chatbot for customer service
When building an AI chatbot for customer service, there are several important steps to take to ensure its effectiveness:
- Firstly, understand the goal of the chatbot. The primary objective should be to efficiently resolve customer inquiries while reducing workload. To achieve this, brands should analyse common customer intents to determine where automation can have the most impact. Thinking of interactions through the lens of pre or post-sales customer service can also be valuable in shaping the design of the chatbot
- The next step is to train the chatbot using high-quality data. Valuable behavioral data can be derived from customer and agent interactions across various engagement channels as well as surveys and other feedback. For example, the Verint Intent Discovery Bot utilises advanced AI technology to process customer data from multiple channels. This enables it to truly understand what the customer is asking and, subsequently, helps the IVAs (intelligent virtual assistants) provide better responses in the future.
- Once operational, leverage data and analytics such as the number of conversations, average response time, user engagement and conversation completion rates for optimisation. Establish a systematic feedback process to measure performance, intent recognition, and advice effectiveness. This ongoing analysis and optimisation process ensures that the chatbot is gaining deeper customer insights and improving and delivering optimal customer service.
Harnessing optimised chatbots in the digital marketplace
While older iterations of chatbots were more used as a post-sales or general enquiry function, more advanced AI-powered chatbots now have the potential to revolutionise the customer experience in the e-commerce space.
They can shift the paradigm of chatbots being a cost centre to becoming a revenue generator. Particularly in a competitive market, brands and e-commerce merchants leveraging advanced AI technologies can ensure round-the-clock availability, personalised interactions, and efficient query resolution, ultimately leading to higher customer satisfaction and loyalty.
Embracing optimised chatbots presents a significant opportunity for e-commerce to stay ahead in a rapidly evolving digital marketplace.
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