Chatbots – the new sales agents?
Advances in artificial intelligence and natural language processing are giving rise to a new kind of service encounter: chatbots. These humanized interfaces allow brands to provide 24/7 support while automating major areas of customer service operations. Recent industry reports indicate that more than 80% of all businesses are considering integrating chatbots within the next five years. Many service providers are already using chatbots, but most applications have focused on cost saving and automation to partially replace human service encounters. However, rather than a mere cost-saving opportunity, chatbots might bring a myriad of advantages in automating customer-company interactions. One critical question for business is: Can chatbots augment the corporate sales force? More directly, are chatbots able to sell?
Through a series of field and laboratory studies, we found evidence that chatbots can indeed alter consumer preferences and purchase decisions. What consumers enjoy in particular is the ability to engage in natural dialogue and even to connect to the chatbot’s “personality.” We gained insights on the “optimal mechanics” of such interfaces and found evidence that incorporating chatbots into consumers’ shopping processes promotes more intimate consumer-brand relationships, greater trust, and can be used as a powerful opportunity to upsell.
Sales automation with chatbots: The critical role of turn-taking and personalization
First, a chatbot’s ability to engage in more natural dialogue compared to traditional media is a critical ingredient for fostering a more enjoyable, trusted user experience. Research in human-to-human interaction has shown that turn-taking during conversations makes the conversational partners feel closer and that they like each other more. Thus, turn-taking is key to fostering trust between interaction partners.
The second important driver for building closer consumer-brand relationships is personalization. Both in terms of the chatbot being viewed as more human-like compared to a traditional interface as well as in its ability to adapt to specific consumer characteristics. People see and treat machines like other humans when these machines possess more human-like features. Brands and products with more human characteristics also lead to more positive brand association and more intimate brand relationships, according to prior research. However, apart from the obvious visual characteristics of a chatbot, it is not very clear what makes an interaction with a machine “feel human” and personal, and how this ultimately affects consumer purchase decisions. A condensed summary of our key insights is presented in Box 1.