To some, scheduling a transfer with your bank via Whatsapp and discussing the best mobile contracts through Facebook Messenger sounds crazy. To others, this is already a reality, and it’s called conversational commerce.
Conversational commerce is here, and it’s completely changing the way consumers interact with and purchase from brands. Here’s what you need to know to be on top of this new means of eCommerce.
What is conversational commerce?
First off, let’s define conversational commerce. Conversational commerce can be defined as eCommerce through means of voice or text-based conversation. Examples can include:
- Live chat on a website
- Purchasing via voice assistants like Amazon’s Alexa
- Interacting with a chatbot on messaging apps
- And more
Typically, conversational commerce will involve a blending of conversational AI, customer service, marketing, and even sales teams seamlessly so that a customer may not even know they’ve interacted with multiple departments. In some cases, they may not even know if they’ve interacted with an AI or a real person!
It fundamentally changes the way both consumers shop and how brands sell. It flips traditional eCommerce on its head, relying not on showcases the most popular products, but not showing any at all! Instead of browsing a product page, a shopping experience might look like this fictional Snapchat conversation:
Customer: I need flowers for mother’s day.
AI: Looks like you’re doing some last minute shopping! Luckily for you, we’ve got 48 hour delivery times, guaranteed. What kind of flowers does your mom like?
Customer: Awesome! She’s a big fan of red tulips.
AI: great, and where are these heading to?
Customer: My mom lives at 123 main street, small town, USA.
AI: Thanks, unfortunately, it doesn’t look like red tulips are available there, but we do have bright orange tulips. (Sends a picture of bright orange tulips) Would these work or do you think she’d like another flower better?
Customer: Orange flowers would be great! How much are they?
AI: $44.99, tax and shipping included. If you’re ready to check out just send the total here as Snapcash and I’ll take care of the rest.
At this point the customer sends Snapcash and the AI processes the order and sends a receipt. It could even offer status updates as well.
Shifting consumer preferences
While email may have been the go-to communication method in previous years, customers are increasingly turning to real-time communication for nearly every aspect of their lives. Many use apps like Slack to communicate with colleagues at work and then go on to use Facebook Messenger, Whatsapp, or similar apps to communicate with friends and families.
Along with the switch to messaging and chat apps, consumers are adopting voice assistants in the form of smart speakers like the Amazon Echo. This massive change in the way consumers communicate on a day to day basis is causing existing marketing and sales channels performance to decline, and it all comes down to one thing:
Being where your customers are
A major part of business has always been about being where your customers are. Pre-internet, direct mail and phone calls were common as they were the primary methods used to communicate with friends and family. Then, in the 90s and early 2000s, emailing friends and family were common, and so brands began to adopt email marketing.
After that, social media marketing took off, and well, you can guess what businesses did in response. Now the new medium for people to communicate with friends, family, and even co-workers is real-time messaging. So you can expect brands to be jumping at the opportunity to be on the same list of contacts as their customer’s friends and family.
AI is the key to conversational commerce
Before now, conversational commerce had to either employ a large team of individuals highly knowledgeable in your product. Chatbots were still not intelligent enough to be reliably used in this medium yet, but thanks to recent advances in machine learning, AI is now powerful enough to handle most all conversational commerce tasks – even transactions!
This makes conversational commerce a real possibility for today’s enterprises and one that’ll offer both cost savings and performance increases!
A new way to sell
Now, with several major messaging apps experimenting with payments through chat, the path is paved for a new way to sell to customers. It all takes place within a messaging app, offering a beginning to end sales journey all through either voice or text-based conversation.
This new sales method will require you to implement an AI as a virtual concierge. It will be able to help visitors with their requests, pointing them towards the correct products, answering their questions, and even completing the checkout process for them, all in a moment’s notice.
A customer will come to your AI for recommendations, ask questions about their product, pay for, and then track the order status all without ever leaving the conversation. In other words, all of the pre-purchase research is completed with your conversational AI, not on the web.
Why conversational commerce is a better sales medium
But conversational commerce isn’t just a new sales channel, it’s a better one. And it isn’t just one-sided either, both consumers and enterprises benefit from conversational commerce.
For consumers, they have a new, more convenient channel where AI can give them fast, accurate recommendations of products. In many instances, it’ll be as if they have their own virtual assistant helping them do their shopping for them!
This will result in an experience that’s both premium feeling and accessible.
On the businesses end of things, you’ll see a few big improvements, mostly having to deal with cutting costs and increasing conversion rates. Let’s break each down individually:
One of the best aspects of conversational commerce is its ability to increase the rate at which your leads convert to customers. It all has to do with our psychology.
See, asking questions is a natural response, but current sales channels, namely websites and social media often force us to answer our own questions. We’re required to look through tons of information on a site, then google any questions we may have about their products or services before making a purchasing decision.
Conversational commerce enables us to ask those questions and get an answer right then and there. No skimming through search results, no looking for a site’s FAQ and hoping our question is there, just a simple question and answer.
This exchange will make us more likely to purchase! It’s a curious effect driven by our psychology, but we’ll spare the details. What you need to know is that when a lead has their question answered by your brand, they will feel more confident about spending money on your goods and services.
But that’s not the only thing boosting sales, you’ll also gain access to much more data for selling to potential leads. Contextual information is a powerful tool for selling to your customers and you just can’t get that in other marketing and sales channels.
This will result in better ability to target a lead’s pain points and thus, sell to them more effectively! Now, onto cost savings.
It’s no secret that people are expensive. Employing a team to be on standby for live chats can be costly, especially at the enterprise level. Not only that, but it often becomes more difficult as you scale larger. conversational commerce powered by AI is the opposite.
The more you scale up the better the AI will become. This is because conversational AI will benefit from the increased amount of conversations and thus data to use in improving its natural language processing, product knowledge, and ability to target pain points.
Are you ready for conversational commerce?
Conversational commerce is already here, and brands who are adopting it are getting huge competitive advantages within their industries. Are you ready to embrace the new era or will you lag behind, losing precious time and money in the process? Learn about how Layer can transform your business channels and request an enterprise demo today!