Do we need a bot strategy?

Just last week a leader of a corporate digital function asked me:

‘Do we need a bot strategy?’

Two things struck me about this question. Firstly, ‘bots’ have been around for sometime… why now? and secondly, is the ‘bot’ movement important enough to warrant a strategy for a large corporate? Before looking at these questions I want to clarify exactly what is meant by a bot.

What is a bot?

A bot in its most generic form is software that performs an automated function or task – think repetitive tasks but increasingly more complex ones. Bots, in the context of the question above, are used to do things like – add an appointment, take an order or make a reservation. These are tasks which can be automated by a bot and which are now appearing in the messaging apps that many people around the world use on a daily basis (e.g. Whatsapp, FB Messenger, WeChat etc.). This use of a bot is closely aligned to the rise of a movement called ‘Conversational Commerce’ which changes the dynamic of purchasing goods or services from a static ‘page based’ web experience to a ‘question and answer’ experience. These bots live inside your messaging apps and are designed to feel like you are chatting back and forth with a human.

A relatively recent example of a bot is Amy from X.ai which is a personal assistant that can be used to manage the to and fro that occurs when trying to book a meeting. To the ‘untrained eye’ it feels like a conversation with a personal assistant. Although bots like Amy are relatively new, they have been around for some time. Twitter has had bots since its launch in 2006. For example – there are bots that tweets about weather or earthquake warnings. Recently Microsoft launched ‘Tay’ a ‘chatterbot’ supposed to mirror the tweets of a 19 year-old American girl. Unfortunately, Tay turned out to be (at least initially) racist, sexist and well just inappropriate as it used the feeds of tweets directed at it to develop its personality.

Despite the many applications, commerce is most interesting. Bot integration into the digital customer experience can be a powerful enabler to reduce ‘cost to serve’ but also improve customer experience. Working with a messenger service and a large consumer business at ways to service customers through a third party messaging platform, a bot experience excels. A bot is able to handle a relatively large range of queries in the messenger where as previously, you might be directed out of the messenger into a mobile web-page or an app, thus breaking the flow and potentially losing a sale. Facebook is exploring how to enable this for its major customers but also a community of developers/ startups.

Why Bots now?

2016 is the year of the Bot and these are 3 major reasons why Bots (particularly in an e-commerce sense) are of significant important today.

1. The Facebook effect

There is no doubt bots are becoming more mainstream particularly in e-commerce sales and service. At Facebook’s recent developer conference F8, the company showcased a number of applications of chatbots on their messenger platform. Bot integration into Messenger is fundamentally driving mainstream adoption given that over 1bn people use the service at least once a day.

By having bots in Messenger, Facebook is trying a number of things. Firstly it is solving many of the sales and service operations burdens for its customers that result from filling out forms or calling a call centre. Secondly, by bringing bots into Messenger it is allowing Facebook to ‘listen in’ on the conversations between retailers and customer and paint an even better picture of the user and thirdly it is setting itself up to be a commerce platform by stealth. It is not hard to imagine that once Facebook is the interface for all your sales and service queries, it could extend further in the value chain to offer logistics services…watch out Amazon.

2. The global mobile-ecosystem effect

Facebook’s announcement about bots is also aligned to its greater global ambitions to be the world’s social platform. In mobile messaging, companies like Tencent’s WeChat in China already have similar ‘bot like’ services through the 10 million brands on the platform that users can interact with to do things like buy food, pay bills, go to the movies or settle a tab. Conversational commerce is necessary to compete with the likes of WeChat or Line in Asian markets.

3. Alternatives to the mobile app and mobile web

It is arguable that the web and mobile web are in decline as users are spending more time on mobile devices, and more time in apps instead of web browsers. With this trend, Bots start to own space inside existing apps (e.g. Messenger, Whatsapp, Snapchat) in the mobile eco-system. In turn, they are likely to form the bulk of monetisable internet activity happening in apps. This is giving rise to the concept of ‘bot stores‘ to compliment app stores and an ecosystem of bot creators like Botapps.io.

Do we need a bot strategy?

The short answer is yes. We are at an inflection point with regards to machine learning due to advances in data analytics, computer science and the application of AI in business (be that in the customer layer or the operational layers). It is becoming not only a way to interact with customers but infused into products, services and operations delivered digitally. Many incumbents companies/organisations currently working out their response to digital technologies (e.g. cloud, social, mobile and big data) need also to consider how AI (aka cognitive technologies) fits into their strategy. Specifically, if you are an organisation with a mobile presence, developing a ‘bot’ strategy could help maximise value from existing apps (e.g. conversational commerce, operational improvement, customer satisfaction) or presence in a mobile app (e.g. new revenue, new service experiences).

Finally, Google CEO, Sundar Pichai said recently on Alphabet’s earnings call:

In the long run, I think we will evolve in computing from a mobile-first to an AI-first world

…for the most part, I could not agree with him more.

Picture Credit: botapps.io

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