What is Conversational Commerce?

The term ‘conversational commerce’ was first used in a Medium article by Uber’s Chris Messina in 2016. Commenting on then-recent developments such as Facebook’s acquisition of WhatsApp, and the emergence of voice assistants like Apple’s Siri, Google Now, and Microsoft’s Cortana, Meddina wrote –

“These and related innovations suggest that “conversational commerce” is growing and concierge-style services may become the primary way in which people transact on their mobile devices”.

It’s been half a decade since Conversational Commerce is no longer a new buzzword, but an established AI-powered solution to boost customer experience and drive sales for e-commerce businesses. As a result, brand leaders are leveraging a variety of conversational interfaces (online messaging, chatbots, virtual assistants, etc.) to deliver an enhanced online shopping experience to customers.

According to a survey, 83% of online shoppers need some form of support during their purchase journey, and 74% of people are likely to switch brands if they find the process too difficult.

Three major challenges in driving online conversions:

1) Customers are unable to decide what to buy: Researching products and comparing options is a tedious, time-consuming process, leading to site abandonment and drop-offs.

2) Customers are dissatisfied with previous purchases: A third of first-time online buyers feel that their purchases do not satisfy their original purchase intent.

3) Customers are unaware of grievance redressal: Many online buyers are wary of defective products and delayed deliveries, and unsure of customer care responsiveness.

In most cases, it increases the rate of cart abandonment for e-commerce brands, which is not a good sign. However, forward-looking brands are leveraging conversational commerce to make the purchase journey smooth and seamless for their customers. Conversational Commerce possesses the ability to transform the way businesses inform, engage and sell.

Before we delve further into the future of conversational commerce and its necessities, let us recap a little and understand precisely what the term means.

What is Conversational Commerce?

Quite simply, ‘conversational commerce’ or contactless commerce refers to the leveraging of conversational interfaces (online messaging, chatbots, voice assistants, etc.) to deliver an enhanced shopping experience to customers. It involves offering customers a means to directly communicate with a brand, coupled with the ability to make online purchases.

Advancements in AI technology, specifically Natural Language Understanding (NLU), offer brands a far more seamless and sophisticated means of engaging customers – Conversational Commerce Chatbots.

Imagine walking into a physical store, looking for a pair of shoes. If the store is seriously customer-centric, you’ll immediately be greeted by a sales clerk. The clerk will understand your preferences (in terms of shoe size, type, price range, color, etc.), and present you with the best available options that meet your requirements. Once you’ve found a pair of shoes you like, the clerk immediately starts to convince you to make the purchase.

In a nutshell, if the clerk does his job right, you walk away happily with a pair of new shoes, and the store closes a sale. Everybody wins. Now imagine the same process being replicated in the context of an online shopping journey.

That’s what conversational commerce is all about.

Conversational Commerce chatbots and shopping assistants effectively simulate the behavior of an in-store sales assistant – engage a customer in conversation, understand their preferences, make relevant product recommendations, and ultimately convince them to make the purchase.

Learn how conversational commerce helped Healthkart automate customer engagements by 80%.

Why Conversational Commerce?

Using conversational interfaces, particularly chat-based commerce, customers are getting comfortable with exploring, selecting, and buying products. And this certainly provides a strong impetus for brands to adopt intelligent conversational commerce platforms for their business use cases. The following customer data trends seem to justify the statement.

Key reasons why brands need a Conversational Commerce platform:

1. Reduce Cart Abandonment: Based on 44 different studies containing statistics on e-commerce shopping cart abandonment, it is calculated that an average of 70% of shopping carts are abandoned. A conversational commerce chatbot reduces the possibility of abandonment by proactively engaging visitors in a conversation that they may find interesting and converts them into paying customer.

2. Up-selling: E-commerce businesses offer a wide range of products and services to customers. With all the customer data collected in one place, conversational commerce chatbots can proactively recommend personalized offers and services tailored to each customer. Products suggested by these online sales assistant chatbots based on a customer’s interest and historical purchase trend, increase the up-selling opportunity for business development teams.

3. Build Customer Loyalty: To create brand differentiation in the market, the buying experience of customers is equally important as the product or service itself. This is because a delightful customer experience leaves a lasting impression and inculcates loyalty in the long term by forging a connection with your customer. By ensuring that the customers are happily engaging with your company’s brand, you are building a long-term relationship and decreasing churn which eventually translates into referral-powered growth.

4. Increase Conversions: When a prospective customer is browsing your businesses’ e-commerce website, that is where the lead generation process gets ignited. It means it’s time to nurture your lead. A conversational e-commerce chatbot interacts with online shoppers in a personalized manner and helps convert them into happy satisfied paying customers by recommending the best products and guiding them throughout their buying journey.

Read how India’s fastest-growing e-commerce startup increased its cart addition rate by 2.4X

Source: https://www.haptik.ai/blog/conversational-commerce-shopping-assistant/