Successful brands are always looking for new ways to interact with their customers and enhance their overall journey. Most recently, brands big and small are turning to conversational AI platforms, primarily chatbots, to achieve a more personalized means of engagement with consumers. However, AI-powered virtual assistants are doing more in the way of consumer engagement by implementing conversational commerce into their repertoire to streamline transactions.
Conversational commerce, simply put, is enabling customers to engage in revenue-generating actions through messaging channels and chat applications. With live chats, chatbots, and virtual assistants, customers can engage in a personalized purchasing experience in real-time.
Brands have already seen enormous benefits upon the adoption of conversational commerce in 2019, which we will touch on in this post. But before we cover the advantages and uses cases of conversational commerce, let’s discuss how it works.
How Does Conversational Commerce Work?
Conversational commerce involves communication between a customer and a brand via platforms such as Facebook Messenger, WhatsApp, iMessage, Viber, Alexa, and Assistant, or a branded webchat or app, to make a purchase.
Brands can talk directly to customers across any touchpoint through a conversational channel. The conversations between customers and a brand can eventually turn into transactions. Through the conversational flow, customers can buy a ticket, order food, or download an app to get to their desired end goal directly in the chat flow.
These transactions can happen in a few ways. It can be as simple as understanding the intent of a question and driving the customer to a commerce-enabled action, such as a "download app now" button. And it can be as complex as integrating with a major ticketing provider like Ticketmaster to offer real-time ticket information and payment options.
Take for example our partnership with the Los Angeles Football Club (LAFC). The California-based Major League Soccer team implemented an in-app assistant named Olly. Olly now has a new set of capabilities, which allow fans to purchase food and beverages within the chat. Attendees can purchase and pick up their orders whenever they please so that they never miss gameplay.
Olly communicates and integrates with the stadium’s several complex systems, like the mobile ordering platform Tapin2 and concessionaire Legends. Behind the scenes, the AI-powered system is doing the heavy lifting, harvesting information from all of the relevant sources so that customers complete their purchase as quickly and easily as possible, without the need for human interaction. When a fan places an order through Olly, they are not sent to third-party sites or outside vendors. The buyer journey starts and ends in a single place - within the chat.
Why Should Brands Adopt Conversational Commerce?
The rise of messaging among consumers is undeniable. In the United States alone, nearly 150 million people used a mobile messaging app in 2018, according to eMarketer. More and more people are relying on smart speakers like Amazon Alexa and Google Assistant to access information, and nearly twice as many people are using smartphone assistants like Siri.
That being said, most consumers struggle to connect with brands. Only 25% of consumers are happy with the level of personalization they receive from brands.
The adoption of conversational commerce can ease the high rates of dissatisfaction among customers by meeting them where they are — messaging apps. Brands have already seen the impact, not just in overall engagement levels, but also in sales.
While customers mainly use chat for support purposes, commerce-driven behaviors are becoming more prevalent through these channels. Today, thanks to the emergence of conversational commerce, 75% of U.S. consumers contact a business over messaging to make a purchase or place an order.
Conversational Commerce Throughout the Buyer's Journey
Customers want a faster, more personalized, and more convenient service, no matter if they're just being introduced to a product, or if they're ready to make a purchase. Conversational commerce is a method of communication that can minimize barriers to purchase, and in turn, increase sales.
Let's take a look at how conversational commerce through messaging or voice command plays a part during each stage of the buyer's journey.
- Awareness - Awareness is the first touchpoint between a customer and a brand. During this stage, consumers can learn about the latest products, new offers, and discounts, which can influence their purchasing decisions later on. By using conversational touchpoints, brands can take back control of the conversation and provide a more service-like experience during the discovery phase.
- Research - Conversational commerce plays an important role during the research stage. Think of this phase as the point when a shopper walks into a traditional brick-and-mortar store or shows up at the box office and ask a sales associate questions about a specific product or ticket. Here, virtual assistants enabled with conversational commerce capabilities can answer questions quickly, reducing the need for customers to search elsewhere for additional information.
- Consideration - Customers will have more specific questions during the consideration stage once they have identified and settled on products they wish to purchase. For example, if a theatre goer is looking to buy better tickets, they might ask a question like, “Are there better seats available?” Conversational commerce-enabled assistants can also recommend additional items or products to create upselling opportunities.
- Purchase - Assisting a customer throughout the checkout process within a chat function is the most direct use of conversational commerce. By programming commerce capabilities in a virtual assistant like a ticket or food vendor, customers can purchase products directly in a messaging channel. This allows the assistant to not only help with a purchase, but they also have the opportunity to remain connected with a customer and keep them up-to-date on shipping and delivery details.
- Retarget - After a customer engages with a virtual assistant on certain channels like Facebook or Apple Business Chat (where their identity is known), brands can communicate with the shopper's preferences in mind. It's important to note that this process isn't as intrusive since the customer must initiate the follow-up conversation. When they do, the assistants can reference past conversations to provide a more personalized interaction.
What Are the Benefits of Conversational Commerce?
1. Improved customer engagement
As we have pointed out, virtual assistants can greatly improve customer engagement throughout every stage of the buyer's journey. According to American Express, the majority of Americans have decided not to make a purchase due to poor customer service.
Meeting customers where they are and offering them a convenience-driven service can strengthen the relationship between a buyer and a brand. In fact, according to Facebook, 69% of U.S. consumers who message businesses say that they feel more confident and trusting, which leads to more conversions.
2. Increased sales
Businesses can now cater to customers and their purchases without ever asking them to leave the messaging channel. From initial questions to payment details, customers can access everything they need in a single window. Satisfi Labs helped WICKED, the world-renowned Broadway musical, to achieve this level of streamlined interaction with their customers.
WICKED wanted to create a frictionless purchasing process for guests. Before the integration with Satisfi Labs, guests were scheduling their visit and purchasing tickets across multiple sites. Since the launch of an AI-powered assistant on the website and integration with the ticketing system, Ticketmaster, guests were able to purchase directly from the platform. This led to a 7X increase in ROI and 20% higher average ticket price compared to the industry average.
3. Scalable customer service
Virtual assistants are a great way to scale customer service. Utilizing them allows brands to respond to simple inquiries any time of the day, seven days a week. Meanwhile, customer service representatives are free to focus on solving more complicated issues.
Our integration with Ripley’s Aquarium and Attractions of the Smokies demonstrates this idea well. This landmark tourist location had limited resources to handle the volume of questions received by visitors — including off-hour, weekend and peak-season times — and lacked any system to track or manage inbound requests. This created a gap in its ability to serve guests according to their actual needs.
To meet this challenge, Ripley’s launched an AI-powered virtual assistant to help answer guest questions on-demand across every experience. The adoption of this technology reduced the strain on limited staff and brought more visitors to Ripley's.
4. Actionable insights
Virtual assistants offer unique visitor insights and enhance purchase data to help brands understand the customer journey. Let's take a look at our integration with WICKED again.
Before partnering with Satisfi Labs, a large percentage of Broadway's traffic was redirected to ticket service sites like Ticketmaster. Because of this, WICKED lost visibility into the buyer's journey, was unable to control the customer experience and didn't have access to the information they needed to retarget consumers once they left the site. By integrating with Ticketmaster and allowing ticketing to stay in the chat flow, WICKED can now see the customer journey data and scale their marketing strategy in a way that makes sense for the customer.
Where Will Conversational Commerce Go Next?
The state of conversational commerce is bound to change to meet the needs of consumers. Looking ahead, voice commerce is expected to account for $40 billion in U.S. consumer spending by 2022, according to a study from OC&C Strategy Consultants. It’s critical to note that V-commerce will mostly still be dedicated to digital transactions and e-commerce experiences.
At Satsifi Labs, we are focused on enabling search for physical locations and live events. We’ve already partnered with Amazon Alexa for voice-powered transactions. Fans of Broadway’s The Phantom of the Opera can purchase tickets for the popular musical on their home speaker and other Alexa devices.
We plan to continue bridging the physical and digital commerce space to enhance the customer experience across platforms.
Through conversational AI, we help sports, tourism, entertainment, and hospitality locations improve customer service, discover new customer insights, and increase sales.
Are you looking to engage your customers with a conversational AI-powered assistant? Get in touch.
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