Chatbots in Retail: The Value They Bring to E-Commerce + Customer Service

Rebecca Reynoso
Rebecca Reynoso  |  April 22, 2019

With the popularity of online shopping and regular growth of the e-commerce market, demand for customer service representatives (CSRs) to tend to customer concerns is increasing continuously. 

To keep up with demand, many brick and mortar stores that also use an online marketplace – as well as online-only retailers – have turned to chatbots as a solution for ramping up their customer service accessibility. Where physical stores have “open” and “close” hours, online retailers do not. Because of this, site browsing, purchasing, and customer inquiries come at any time of the day and on any day of the week. To best serve customers on a global scale, chatbots are being utilized as the next line of defense in maintaining strong customer relationships worldwide.

Chatbots – what are they?

Chatbots are chat robots that are found on a company’s landing page and/or social media accounts. Chatbots are used to communicate with human customers about various inquiries, from FAQs to account issues.

Chatbots in retail

Instead of worrying about whether online shopping is killing the traditional retail marketplace, it’s more important to focus on what online retailers are doing right to make them stand out against their competition. Despite reports that online stores are doing well, it’s no secret that some are more successful than others.

So, what makes the successful ones stand out? A creative, user-centered website design? Discounts on merchandise? Or is it advancements in customer service tactics that their competition isn’t using yet? Enter chatbots.

The two most common types of retail chatbots found today exist either through a company’s website or via Facebook. Chatbots that live on a website’s landing page may be hosted through a chatbot creation company or made in-house by a tech expert. 

Conversely, chatbots that exist via Facebook Messenger are either attached to the retailer’s business Facebook account and connected to their site or connected directly through Facebook and are accessible via the Messenger app.

Retail chatbots on website landing pages

It’s no secret that most  if not all   companies employ software developers who are skilled at developing programs, applications, and occasionally chatbots. If a company employs in-house developers, it’s possible they may choose to independently create a chatbot. Whether it’s for the sake of individuality or to help developers perfect the practice of chatbot creation, it’s completely up to the retailer. 

Some chatbots pop up in the user’s browser window the minute they click over to a company’s website, while others have to be sought out by clicking through a series of buttons. Oftentimes, chatbots can be found by clicking a chat bubble icon or a linked button that states “Click to chat,” “Chat now,” or some variation. Staples, for instance, has a drop-down menu with multiple chat options for their customers. 

staples dropdown menu

Image courtesy of Staples  

The Live Chat button takes users to a “live” chat with a bot where the bot asks simple queries to better help guide users to the appropriate human customer associate.  

staples bot chat

Image courtesy of Staples

To ensure transparency while demystifying the use of chatbots, Staples clearly tells their customers that they are speaking with a bot. This practice is good for maintaining trust with their customer base while still having the benefit of a chatbot as the first point of interaction for a user. Allowing a chatbot to filter someone’s larger question into smaller, more manageable pieces helps to increase the efficiency of their overall customer service.

Levels of increased efficiency can be gauged through the length of time it takes for a customer question to be resolved; the necessity of manpower after interacting with a chatbot; the accuracy in guiding customers to the appropriate CSR; and the ability to solve inquiries on the first try. 

Retail chatbots via Facebook Messenger

Many retailers find it simpler to host their chatbot through Facebook Messenger because it is easier to create one on there than from scratch. Despite this, the person creating the Facebook retail chatbot still has to have working knowledge of the basics of coding as well as how to follow instructions directly from the website. Facebook has an entire series of pages dedicated to web developers which helps guide them through steps on how to make a Facebook chatbot among other how-to development information.  

facebook bot creation doc

Image courtesy of Facebook

Facebook-hosted retail chatbots are essentially extensions of the company or brand’s marketing and outreach teams. How? Well, Facebook chatbots can be developed to answer high- or low-level inquiries depending on how they are programmed.

Thus, if the person creating the Facebook chatbot for their retail platform goes about the long-form method of programming the bot with natural language processing (NLP) capabilities, then it will be able to respond to user queries in a more natural, human-like manner.

Conversely, if the person creating the chatbot chooses to use canned responses without NLP, the bot’s purpose may be best geared as the first point of contact a customer has before interacting with a human CSR rather than as an expert chatbot that can answer all customer questions. Going this route will drastically cut down on time it takes to create a chatbot, though it may also potentially decrease the trust and reliability someone has in a retailer depending on the quality of their interaction.

For a company like Domino’s, it makes sense to use canned responses and doesn’t deter from customer trust because most of the questions are simple “Yes,” “No,” or “Choose from this list” type questions.

domino's pizza chatbot chat

Image courtesy of Domino’s Pizza via Facebook

The one main difference in the amount of time it takes to create a chatbot from the ground up versus through Facebook Messenger is the language that the bot is programmed to know (or learn). Programming the chatbot with canned responses will significantly reduce how long it takes to develop versus training it to learn from and understand natural human language habits.

As you can see above, Domino’s has programmed their chatbot to respond directly to pre-programmed inquiries they have placed as options on their messaging platform. A person can still write their own question to the chatbot, but it strongly encourages people to use the “typical” question buttons to engage its bot to accurately respond to their inquiries. 

TIP: Check out how to build a Facebook chatbot marketing funnel

Takeaways and overall value of chatbots in retail

It is evident that chatbots in retail are not only rapidly growing in popularity, but growing in terms of financial benefits and streamlined customer service. Like anything, making a decision about where to host (or how to make) a chatbot for a retail company can be intimidating. 

So, when considering where to host a chatbot, if time is of the essence, Facebook Messenger chatbots for retail are more lucrative. However, if depth and quality of responses to inquiries are more important to a company, it’s worth considering creating a chatbot from scratch directly on one's homepage or website (or by using Facebook as the platform while implementing NLP for the highest possible levels of language understanding). 

Chatbot integration in retail and e-commerce will continue growing as time moves forward, which means companies are going to try to find the right type of chatbot software to best benefit their brand. Whether enterprise level or a smaller business with a growing online presence, the implementation of chatbots as a part of one’s customer service and e-commerce strategy will help boost positive feedback, customer happiness, and overall efficiency. 

See the Easiest-to-Use Chatbots → 

If you’re interested in learning more about chatbots, make sure to check out how to use chatbots for your marketing strategy as well as this comprehensive guide on 35 chatbot statistics for 2019

Rebecca Reynoso
Author

Rebecca Reynoso

Rebecca Reynoso is a Content Marketing Associate at G2. Her passion for writing led her to study English, receiving a BA and MA from UIC and DePaul, respectively. In her free time, she enjoys watching and attending Blackhawks games as well as spending time with her family and cat.