The chatbot is dead, long live the chatbot!

In January, Wired announced the demise of Chatbots following the news that Facebook would be shuttering its M digital assistant project. Though Wired saw the end of M as a sign of disinterest in chatbots generally, businesses have a different view. Automation in customer service is showing real returns, and while not all consumers are on board with the idea, it has largely gained acceptance for at least some simple tasks and questions.

A headline proclaiming the end of chatbots in 2018 is asking to be mocked years from now. Automotion is proving useful in a plethora of areas, customer inquiries included. Facebook may have over-promised what chatbots on its own platform would be capable of achieving, but even with the end of M, chatbots persist on Facebook Messenger and may soon be introduce to its sister platform WhatsApp.

One of the reasons for the hype is that chatbots have worked so well in China on WeChat. Yet the utility of the technology had always been limited. Even in China, official accounts still rely heavily on preset options for users to select to get information. The introduction of artificial intelligence has made chatbots more useful, but they were never meant to supplant human interaction.

So what are chatbots good for? Turns out they’re great at answering simple questions that could eat up valuable time among employees if they have to answer those questions themselves. Though consumers love to complain about having to go through a robot to talk to a person, much of the time customers only need help with something simple. Unliked dreaded automated phone menus, though, talking with a chatbot can feel more natural for customers.

This is why chatbots aren’t going away. Companies are already seeing real savings from implementing them.

In a special report on AI, the Economist reported that about 30 percent of companies now implement their own chatbots. The head of technology at MetLife estimated that AI currently offers a 20 percent return on investment.

In China, the practice is widespread and millions of consumers make the numbers add up quickly. A WeChat bot for Shenzhen’s China Merchants Bank gets between 1.5 million and 2 million queries daily. Ping An, a Chinese insurance company, uses AI to assess photos of car damage to give customers a quote on repairs. The company now handles nearly a third of its 15 million claims through its app.

So far, marketers in the U.S. and U.K. have been less enthused with chatbots. One survey shows just 7 percent use AI-powered chatbots and 27 percent said they would look into using them in 2018.

(Source: eMarketer)

The main issue today might just be awareness. Many people are not aware of how widely available and accessible chatbots have become or how it can help them. The ROI is real, though, so they’re not going to disappear regardless of what specific bots come and go.

For startups, this kind of technology can be useful for fielding customer inquiries when they can’t afford a room full of help desk personnel. This is why so many websites today for fledgling services have automatic chat windows popping up asking users if they need help. What was once a nuisance is increasingly useful thanks to evermore sophisticated AI.

The question then becomes whether a company should outsource AI development or build something in-house. The most practical thing for most startups trying to sell their own products and services is to set up a chatbot through someone else. Maybe there will come a day when a startup will need to develop its own proprietary AI solution. However, if your goal today is to just sell widgets to thousands of people across the globe, there is probably an AI solution that can already help.

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