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A Beginner’s Guide to the History, Business Applications, and Future of Chatbots | by Kelly Mirabella | Jul, 2021

Kelly Mirabella

Have you ever wondered what the future holds for chatbots? The chatbot industry is growing exponentially, and many people are wondering whether or not they should invest in this new technology. In this blog post, we will explore the history of chatbots, their business applications, and how chatbots might be used in the future.

A bot is any virtual agent or software application that interacts with customers on social media channels by using either text or voice messages. “AI” stands for “artificial intelligence,” which means these applications have are given anthropomorphic properties so they can think like people do. Applications such as Siri, Cortana, and Alexa all fit the bill of a chatbot.

Not all Chatbots use ai. Some can be pretty efficient with the help of conditional logic trees built by a human programmer. But the best chat solutions employ both the human-built touch and artificial intelligence.

Chatbots have many uses that range from helping you navigate your bank account to providing customer service for business customers.

The first type of chatbot was created on May 13, 1966, by Joseph Weizenbaum at MIT’s Artificial Intelligence Laboratory (AI Lab). The ELIZA program ran conversational text with a human user to simulate conversation while using keywords from an input dialogue to respond accordingly. It then replied to those inputs until it reached another keyword triggering a new response.

In 1973, a variation of ELIZA was created by Kenneth Colby at Stanford University called PARRY. Unlike ELIZA, PARRY simulated conversation with a human user and attempted to respond as if it were paranoid or schizophrenic in nature. Weizenbaum had programmed ELIZA using psychoanalytic principles from his studies at Harvard Medical School. He worked there between 1964–1970. He had developed an interest in psychiatry because of its close relationship to artificial intelligence research: “I felt that psychiatrists should be more concerned about AI than most.”

Since these first chatbots emerged onto the scene, any number of bots have been coded, including SmarterChild (1999), Cleverbot (2005), and AliceBot (2006).

Chatbots can be built and maintained by humans or artificial intelligence. And while many small businesses previously struggled to tap into these fast-moving technologies, new tools and platforms have emerged to help companies tap into these technologies.

Tools like ManyChat allow you to build conditional logic and intelligent chatbot automation for Instagram, Facebook Messenger, and even your website using their visual builder tools. No coding experience is needed. They even offer a free course! You can also learn about ManyChat and use the platform on the Baby Got Bot YouTube Channel.

If you want to integrate ai into your ManyChat Chatbots, you can use tools like Janis AI or DialogFlow by Google to create your chatbot, train it with natural language processing and build an engaging experience for customers.

Another excellent tool for those in the Restaurant industry is Feebi which is ai built specifically for the Restaurant industry. Feebi allows the chatbot to answer up to 80% of chat inquiries that come in and quickly hands off messages that need the human touch.

Also, for Restaurants, there is an all-in-one platform called Tap The Table, making a fully integrated chat automation strategy a breeze.

These tools make it easy for companies to start using Chat automation to help more customers and land more business.

Many businesses wrongly believe that chatbots are annoying and may scare customers away, but the numbers tell a different story. The vast majority (87.2%) of consumers have neutral or positive experiences with chatbots (Source: Drift). Additionally, the average satisfaction rate of bot-only chats is 87.58%. This is almost two percentage points higher than the satisfaction rate for conversations that get passed over to human agents! (Source: Comm100)

The vast majority (87.2%) of consumers have neutral or positive experiences with chatbots

1. How Conversational AI can Automate Customer Service

2. Automated vs Live Chats: What will the Future of Customer Service Look Like?

3. Chatbots As Medical Assistants In COVID-19 Pandemic

4. Chatbot Vs. Intelligent Virtual Assistant — What’s the difference & Why Care?

Let’s explore how companies use chatbots today to help customers, drive sales, and become more efficient.

Chatbots drive sales:

By 2023, $112 billion worth of eCommerce transactions will be made via chatbots. By leveraging push factors to drive retail sales and upselling certain products, the power of a Chatbot can help your company reach new levels in both online marketing and cart recovery notifications which keeps customers coming back for more. As Juniper Research predicts, it’s only going to grow exponentially from here on out!

Using abandoned cart chatbots alongside Messenger boosts eCommerce revenue by 7–25%.

Kia is one such company that is using Messenger bots to drive engagement and sales. Users can interact with Kia’s ‘Kian’ by searching ‘Kia Motors America’ in the Messenger app. Kian began as a promotional tool during the 52nd Super Bowl in February 2018 for the new Niro car model. Since then, Kian has expanded to handle any of the questions that a salesperson would be able to answer. Kian can also help with roadside assistance, bill payment, and locating a Kia dealership near you.

The Kia Messenger bot sees 115,000 users per week on average and gets three times more interactions than the Kia Website. Octane AI developed Kian in conjunction with CarLabs and mobile agency Ansible. Learn more about this case study at https://digiday.com/marketing/personalization-allows-media-optimization-kia-seeing-3-times-conversions-chatbot-website/.

Chatbots simplify customer service support and answering FAQs.

Chatbots can help take a huge chunk of the burden of customer service and inquiry off of human agents, plus save a company thousands of dollars. Chatbots can save businesses as much as 30% on customer support costs. (Source: IBM).

A great example of a FAQ and customer service support bot is Evernote. The Evernote Chatbot was created using Sprout Social and helps customers with technical issues, customer support ticket status, and feature requests. It also Prompts customers for the information that agents need to assist the customer (e.g., ticket number, version number), making the chatbot to human handoff efficient and straightforward.

The Evernote chatbot has been a success with a reported 18% decrease in replies sent per conversation, and an 80% increase in customers helped on Twitter (this is a Twitter chatbot). (Source: https://sproutsocial.com/insights/case-studies)

Another company that found profound success with a chatbot is Charter Communications. Charter Communications found a way to save its company money and time by switching to an automated chatbot. Before, they received 200,000 live chats per month, with 38% of these being forgotten passwords or usernames for services that can be handled automatically through the bot. When Charter switched over, it only took six months before there was 300% ROI, and the bot managed 83% of all of the chat communications! (Source)

When Charter switched over, it only took six months before there was 300% ROI, and the bot managed 83% of all of the chat communications!

Chatbots for lead generation:

When a company creates an engaging chatbot experience on their website or social media page (and gets shared), this helps create leads for companies without using advertising dollars. 55% of businesses that use chatbots generate more high-quality leads. (Source: Drift)

One of the easiest ways to drive lead generation and sales is through a Facebook Messenger bot and a comment growth tool. The Comment Growth tool enables a Facebook business page to automatically initiate a Messenger conversation after a user comments on a page post. This means you can make money directly from your Facebook posts, and even better, you can track the user and the sale from beginning to end.

Book Tickets To Events/Shows With Chatbots

Chatbots are used to purchase tickets. For example, built into Ticketmaster’s mobile app, users can chat with a bot which then helps them navigate their way through the purchasing process and ensures they get the best seats possible for their budget! The Ticketmaster chatbot utilizes natural language processing to help users search for tickets and purchase them. Payments happen via lined Credit Card or Gift cards right inside the app, and e-ticket and receipts are delivered instantly in the user’s linked email account. The Ticketmaster app is made more intelligent by using Google Dialogflow ai technology. (source: https://cloud.google.com/dialogflow/docs/case-studies/ticketmaster)

Use Chatbots to book appointments.

Many businesses are using chatbots to help manage customer inquiries and book appointments. For example, Sales Rabbit Is a company that books meetings for sales teams. They were using a form that then exchanges emails between the rep and prospect. After switching to a chatbot, they can qualify leads and immediately book time on their sales team’s calendar. SalesRabbit has a 40% lift in the conversion rate of requests to meetings held and a 50% increase in qualified leads. source https://www.drift.com/case-studies/

These are only some of the ways chatbots are helping businesses and consumers alike. No matter what industry you’re in, there are likely many ways your business can be helped by using Chat automation with bots! As We say in the chat marketing industry, “There is a bot for that.”

Chatbots will continue to grow in popularity and increase their use cases. They will be used as customer service, sales assistants, among other tasks. The chatbot market size is projected to grow from $2.6 billion in 2021 to $9.4 billion by 2024 at a compound annual growth rate (CAGR) of 29.7%. (BusinessInsider) More Businesses will adopt this technology, with 80% of businesses expected to have chatbot automation by the end of 2021. (Outgrow).

The chatbot market size is projected to grow from $2.6 billion in 2021.

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