A chatbot system simulates a conversation (or a chat) with a user using messaging services, websites, mobile apps, or the phone by utilizing conversational AI (artificial intelligence) technology which allows people to have a dialogue with computers to ask questions or troubleshoot problems, etc. It performs live chat operations in response to user interactions using rule-based language applications (A program that is composed of a set of rules that are used for making decisions). Why must there be a need to build these chatbots? The answer to it is very simple to communicate with customers directly, via SMS, Facebook Messenger, Kik, Slack, and Amazon Echo. These bots carry out tasks such as:
delivering fashion advice (H&M)
direct ordering(dominos)
beauty advice (Sephora)
.... plus a lot more...
Why so popular?
One of the most well-known applications of artificial intelligence is chatbots. This is due to a number of factors. The simplest way for any company to improve customer service is to track consumer data and gather information. Chatbots can collect data from customer reviews and use that information to provide insights into how to make your products and services better. They are helpful in a business since they automate various customer support functions and so save time and labor. In call center and commercial environments, chatbots can also aid in the elimination of some monotonous activities. Recently there is fear among people that ChatGPT, the new emerging technology in chatbots that has recently made the news would replace human workers. So chatbots won't necessarily replace human employees in their current positions, but they will allow people to focus more of their time on important jobs. Additionally, while there are various kinds of chatbot technology available and they all function differently. You can discover people discussing ChatGPT and how they might use it for their specific business or social networking or business forum.
Use cases
Sales and Marketing
Through personalized product suggestions, insightful feedback, and improved segmentation, chatbots help customers throughout the whole customer journey and are crucial in moving them farther down the sales funnel. It segments the audience based on different factors such as demographics, interests, age, gender, etc, using the data gathered during the conversation. Examples are Burger King’s chatbot, called "Niki" which gives suggestions for meals with top discounts, Nike’s chatbot, "Stylebot" recommends products based on user's preferences, etc.
Travel and Hospitality
Customers in travel and hospitality demand individualized experiences, just like those in e-commerce and retail. In terms of customer service, chatbots may do everything from managing reservations and bookings to creating customized itineraries. Reservations, bookings, refunds or reschedules, ordering, and delivery are the most widely used chatbot functions in the travel and tourist industries. Famous Travel companies like Expedia.com, Kayak, and Sky scanner have launched bots of their own on Facebook Messenger and Slack, which help travelers to book their hotels.
Customer Service
chatbots are generally thought of as a customer-facing channel. However, chatbots can also work well as assistants to customer service agents themselves.24/7 support by customer-facing chatbots, automated resolutions to frequently reported issues, etc are tasks performed.
Post-Purchase customer service
By building automated workflows, we can equip our bot to resolve issues related to post-purchase customer service issues such as Order tracking, Rescheduling the date of delivery, Cancelling orders, Refund requests, Replacement requests, etc.
Healthcare
Particularly in recent years, when hospitals and other institutions are obliged to reduce lines and crowding. Here are several ways that chatbots lessen face-to-face interactions: Appointment scheduling, conversational self-service, billing, insurance procedures, etc. "Healthily", an A.I.-powered symptom checker is the source of online medical service providers. Another example is "Eda health" can assess the user’s health based on the indicated symptoms using its vast, A.I.-based database.
Media and Entertainment
The media and entertainment business heavily relies on chatbot software, which can help consumers manage their subscriptions and give quick summaries of the most recent news. News channels like NBC Politics and CNN Facebook bot have deployed chatbots that concisely summarize ongoing events. This is very helpful for readers who are looking to catch up on current affairs when they are on the go. , subscription management, installment, maintenance, etc.
Education
Universities and other educational institutions may find it difficult to support more than a thousand learners. However, these educational institutions can easily handle the high frequency of inquiries by implementing AI-enabled chatbots. An example is chatGPT.
Recent Trends
Key statistics
Take a glance at the research-based statistics that provide valuable insights into the trends of the chatbot industry.
More than 50% of enterprises will spend more on bots and chatbot creation than traditional mobile app development. (Gartner)
75-90% of queries are projected to be handled by bots by 2024. (CNBC)
The top industries profiting from chatbots are real estate, travel, education, healthcare, and finance. (Service Bell)
The market size of Conversational AI is expected to reach USD$1.3 billion by 2025, growing at a CAGR of 24% (Cognizant)
The global chatbot market size was estimated at $430.9 million in 2020 and is expected to expand at a compound annual growth rate (CAGR) of 24.9 percent from 2021 to 2028. (GrandView Research)
In 2019, there were over 40 million active businesses messaging people across the globe, exchanging over 20 billion messages each month. (Messenger News)
77% of customers say chatbots will transform their expectations of companies in the next five years. (Salesforce)
79 % of consumers like using chatbots because of their ability to provide quick replies to simple questions. (Chatbots Magazine)
63% of consumers believe businesses should be on Messenger (Chatbots Life)
Chatbots will save the banking, retail, and healthcare industries $11 billion annually by 2023. (Juniper Research)
Is there any future?
Chatbots do indeed have a future. Fortunately, it appears that chatbots will continue to exist for some time to come. Business communication and client understanding are changing as a result of chatbots. Chatbots will be able to provide a more individualized client experience with the help of AI.