A guide to help yu decide and integrate chatbots into your e-commerce strategy.

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Framework for
Brands to
Incorporate
Chatbots into Their
E-Commerce
Strategy

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Digital (non–brick-and-mortar) commerce has gone through
several evolutionary steps; each has led to large shifts of
consumer spending preference by channel. While social has
long been the key influencer of most digital sales, it is now
that we will see its actual impact. Retail adoption of social
media or the message platforms is not the real game
changer here. What is important is that emerging AI-
supported message handling tools will be able to deal with
80% to 90% of all customer interactions - giving brands the
capability to provide 1:1 Individualized Retail interactions to
their online customer as well.

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Integrations with social media platforms, whether
that’s communication, data and product analysis,
or direct purchasing, will become a lot more
popular, especially as a means of communicating
with customers (outside of just emails) and
providing personalized support. Smart companies
are already finding new and innovative touch
points with consumers that are contextual,
relevant, highly personal, and, yes,
conversational. Two key — the exploding
popularity of mobile messaging apps and
advances in artificial intelligence — are coinciding
to enable a new generation of tools that enable
brands to communicate with customers in
powerful new ways at reduced costs. 80% of
businesses have already used or plan to use
chatbots by 2020. However, consumers’ needs
are evolving more quickly than retailers can keep
up with, if brands want to survive, they must be
quick in adopting technologies that foster
conversational commerce and have it as one of
the top business strategies to keep ahead of
competition.
Key E-Commerce
Trends

4. 4
One report by Deloitte found that about 47% of
millennials accept their purchase decisions are
majorly influenced by social media.
Comparatively, more than other generations,
millennials pay closer attention to social media
while shopping. Millennials primarily use social
media as a way to receive inputs from their
friends and connects about which products and
services are best to use and which ones not to
use.
According to Smart Insights, more than two-thirds
(approx. 67%) of all online users are active on
social media, with nearly all (approx. 90%) of
Millennials checking social media very often. And
active users are spending a lot of time on social
channels, with usage now accounting for more
than 28% of all media time spent online,
according to GO-Globe, a web development
company. Those between the ages of 15 and 29
spend two to three hours each day on social
media—surpassing the amount of time spent on
traditional media like television or even
comparatively newer mediums such as email.
How Does Social
Media Influence
Consumer Purchase
Decisions

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In a public Q&A session November 2014, Mark
Zuckerberg explained: “Messaging is one of the
few things that people do more than social
networking.” Users are attracted to chat and
messaging apps because they are convenient to
use, have user-friendly and interactive interfaces,
and are more personal than other channels like
email and social media. This is also why these
apps are slowly becoming the major channel for
interactions with customers when it comes to e-
commerce. Sevreral companies have become a
part of this trend.
Key E-Commerce
Trends
In 2015, Uber partnered with
Facebook, and allowed users to
book rides using Facebook
Messenger. Aside from this a new
feature that can be accessed through
an in-app Uber button, which allows
users to directly communicate with
drivers and pay for their ride through
the app itself. On top of this, Uber
even used this to attract more users,
giving away free $20 Uber credits to
those who try their services using the
app.
Dutch airline KLM launched an
option that allows passengers to
book flights and get updates about
flight schedules using Facebook
Messenger.
In 2011, WeChat launched a peer-to-
peer (P2P) money transferring
platform called WeChatPay, allowing
users to send money to their friends
in exchange for a small fee.
In 2014, a very similar program was
initiated by Snapchat (called
SnapCash)
Conversational commerce is leading
a fundamental shift in e-commerce,
and more and more companies are
adhering to this change.

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Chatbots may sound like an extremely futuristic notion, but
according to Global Web Index statistics, it is said that 75%
of internet users are adopting at least one or more
messenger platforms. Although research shows us that
each user makes use of an average of 24 apps a month,
where the user spends about 80% of the time in just 5 of
these apps. This means you can hardly gain friction as an
app. But as a chatbot, you still have high chances to
integrate your chatbot with one of these 5 platforms and
gain success.
How can
chatbots
help your
business

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Key benefits chatbots provide
• Available 24/7
• Customer Care- A study suggests that humans
can only concentrate on 3–4 things at the same
time. If it goes beyond that you are prone to making
errors. Chatbots on the other hand can
simultaneously have conversations with a multitude
of people without making errors regardless of what
day it is or what time of the day it is or how many
people are contacting you, every single one of them
will be answered simultaneously and within a
couple moments of sending a request. Companies
like Taco Bell and Domino’s are already using
chatbots to arrange delivery of parcels.
• Provides customer with the utmost satisfaction as
it can be programmed to be courteous, polite and
even speak in the language of choice of the user.
• Helps you save money- you can save massively
on employment costs.

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Chatbot use-cases
CUSTOMER SUPPORT
Being the most obvious and common use-
case of chatbots, they are one of the most
efficient, quick and cost-effective ways of
responding to customers’ queries.
PRODUCTIVITY
Productivity bots can also serve as an inter-
committee messaging system which can also
be used to share files and data. Deploying
productivity bots can improve satisfaction
within the work environment and increase
transparency within the company itself. Eg.
Slack
SOCIAL
You could also create fun bots that send
jokes or suggestions to users on demand.
This could increase the brand preference for
your business. For example, Sephora
deployed a bot, which gave users on
demand suggestions about make-up and
which products to use.
COMMERCE
Your chatbot can also help customers
discover new products and collections with
ease. You can also enable users to buy
products and/or avail services easily on such
a platform.

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WeChat
Facebook Messenger
Snapchat Discover and SnapCash
Amazon Echo
Slack
Sephora
Popular Commerce Chatbots
AppleTV and Siri
Allo from Google
Magic
Kik Bots

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Building an in-
house chatbot
compared to using
a service

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TIME COST EFFICIENCY MAINTENANCE EXPERTISE AND
TEAM
IN-HOUSE
Building a chatbot
inhouse will take you
580-736 hours on an
average to create a good
communication interface
and develop a business
strategy.
Building an inhouse bot
from scratch can cost
you about $6,000-
$12,240.
For an efficient bot you
need a good interpreter
for command language
and natural language
processing along-side a
good business logic and
marketing strategy.
Is harder to maintain as
your bot needs to
constantly evolve in its
conversational skills and
it’s language processing
capabilities which
requires a huge number
of conversations and
knowledge base along
with developers strong in
natural language
processing.
Creating a bot specific to
your use-case will
require – a team with
high level expertise in
machine learning,
conversational
architecture, copywriting,
business logic. Most of
all you’d need a team
very agile with testing
and redeployment which
understands and is quick
to adapt to customer
feedback.
SERVICE
Outsourcing a service will
save a lot of your time
and will just take 10
minutes to register and
set up your bot.
Using a bot service can
cost you as little as $15
per month.
Good service providers
take care of having good
language interpreters
and business logic. Few
of them such as
Jumper.ai also help you
integrate your bot with
your marketing strategy.
Depending on your bot’s
use-case and your
chosen service provider
– your maintenance
requirements can range
from nothing – with the
service provider
automating it for you
over a period of time or
to a few hours weekly to
just improve your bot’s
conversational
messages.
Service providers may
vary in their offerings –
most will cater to a large
subset of generic use-
cases and will be mostly
focused on general
conversations.
Depending on the use-
case you want to use the
bot for – you should find
a service provider which
specialises in your niche.

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Integrating
Chatbots into Your
Brand Strategy

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Opportunities
Conversational commerce opens
up new opportunities for retail
brands to tap into the strong
growth that we’re already seeing in
mobile commerce, a growth that
amounted to 29.7% last year. With
such large growth, brands should
be selling to consumers through
any app, especially those that are
used most frequently, such as
messaging.
Now that brands are free to enter
messaging channels across nearly
all major platforms, they can
engage consumers one-on-one in
the places where they already
spend large amounts of time and
create new buying opportunities.
Chat bots clearly have some
advantages over traditional apps.
These are:-
• They are capable of engaging
with the end user in a natural,
friendly and easy-to-understand
manner
• Chat bots can interact with
customers through apps that the
customers are familiar with, such
as Facebook chat, thereby
enhancing customer experience.
• They are more appealing to the
next generation of users.
In some scenarios, they can even
out-perform humans:
• Chat bots are likely to provide
more comprehensive, up-to-date
information as they have the
capability to filter through a large
search space at speed.
• Chat bots have the potential to
provide a 24-7 service, and a
downtime that is mostly scheduled.
• Finally, chat bots don’t suffer
from human traits such as mood
swings, tiredness, etc.

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Challenges
• Data: To make your chatbot a
success, you need to collect a lot
of data about your customers, their
interaction with the chatbot and
their answers. You also need to
constantly get data from your
internal systems to provide
accurate answers.
• Customer Adoption: In order to
drive customer adoption, just like
for any other new technology - its
key to integrate the chatbot
solution into your customer current
behaviours and discovery
channels.
• Differentiation between bot and
human: Your chatbot will learn
from customer interactions over
time, however initially it's important
to provide customers with a
personalised experience yet let
them know that they are chatting
with a bot. This would help and
keep their expectations defined.
• Selecting the right set of
customers: Chatbots are a new
technology, and not all your
customers will be comfortable.
Hence while creating your strategy
you need to be clear about your
customer demographic. Which
segment of your customers use
messaging apps the most,
discover your products on social
media, demand faster service,
would like personalize interaction.
• Over-all strategy – Chatbots can
help you have a perfect
conversation with customers,
however it’s key for brands to
enable personalisation and
customer attention in their overall
business strategy. Eg you could
add a thank you note with your
deliveries, to make the customers
feel a greater connect to your
brand, or provide special coupons
and loyalty programs to your
chatbot users.

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Choosing the right chatbot engine
There are lots of great services in the
market to help you build a chatbot. The
key factors to weigh while choosing the
right chatbot engine should be:
1. Does it cater specifically to your
use-case? - Most chatbot builders
cater to a large generic set of use-
cases trying to encompass every
kind of potential interaction.
However the overall interaction
and skill set of a chatbot will tend
to differ not just from use-case to
use-case but also from industry to
industry. If you need a chatbot to
increase your sales - choose one
that focuses on ecommerce eg-
jumper.ai, if you need a chatbot for
customer service, choose one that
focuses on it- eg-smooch.io.
2. Does it cater to the platforms
where your customers are?-
Chatbots are found predominantly
on platforms that rely on
conversation as the primary way to
interact with customers, so
developers are limited in where
their chatbot can reside -
Facebook Messenger, Kik,
WeChat, Viber. But, as social
media marketers already know,
you must go where your
customers are. Look out for
chatbots which can help you easily
onboard your customers from your
current platforms - Facebook,
Instagram, YouTube, Twitter and
more.
3. How much does it cost? When you
are experimenting with a new
technology, it's important to keep
your cost low and proportional to
your adoption rate. Most chatbot
services will charge you an upfront
cost plus a per conversation
charge, however that may not
make much sense if your goal is
sales or customer service - a per
sale or per successful customer
query resolution will be more
efficient as your customers can
experiment and familiarize
themselves with your chatbot.
Later as your bot's adoption grows
and your volume grows you can
always negotiate better pricing with
your service providers.

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Tips for integrating
chatbots in your
brand strategy
It’s time to start thinking about chat
bots as disruptors. With chat bots
adding greater functionality to already
popular messaging apps, there is a
possibility to lose direct contact with
your customers. One way to continue
to engage them in the right place, at
the right time, with the right information
in a cost effective manner is through
the proactive incorporation of chat bots
into the heart of your products and
services. Here are some tips to get you
started with a Proof of Concept that
has the following 4 properties.

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Aim to limit the scope of what your chat bots can do by focussing on a product/service to start
with. Only engage the chat bot when the conversation turns to the chat bots speciality, while
augmenting this conversation with a person. Slowly, expand the chat bots knowledge base by
feeding it more relevant information over time.
FOCUS ON SPECIFIC PRODUCTS/ SERVICES
Use the data obtained from these chat bot-centric interactions to further refine the chat bots
themselves. Have processes in place to harness these learnings to improve the very
products and services that chat bots support.
LEARN & ADAPT
A chat bot needs to have all the relevant information about the products/services it is supporting.
Ensure that your chat bot has been exposed to the relevant internal process flows, specific
customer journey maps and deep products/services knowledge that is required for it to answer
queries and automate responses.
ENSURE ALL RELEVANT DATA IS AVAILABLE
Chat bots can be deployed to provide basic customer support by themselves, support human
interactions with detailed facts, highlight and drive sales opportunities or streamline internal
processes. Be sure to understand and articulate what your chat bots are for early on.
CLEARLY ARTICULATED VALUE PROPOSITION

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Long Term Strategy
Chatbots are comparatively new and it will be sometime before they see mass adoption. However unlike apps,
chatbots require a significant time investment to understand the customer’s intentions and to be able to promptly
cater to them. If you plan to keep ahead of your competition it’s key that you start now - as any business when
starting to implement chatbots needs time to build the right use cases for their target customers, create proper
conversational architecture, and refine their overall marketing strategy for the same.

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REFERENCES
1. http://www.kurtsalmon.com/uploads/Social%2BCo
mmerce%2BEconomy%2B160830.pdf
2. https://www.forbes.com/sites/jimmyrohampton/2
017/05/03/does-social-media-influence-
millennials-shopping-decisions/#3ea3dc224cf3
3. https://blog.bufferapp.com/messaging-apps
4. https://www.visenze.com/blog/3-ways-
conversational-commerce-is-affecting-the-way-we-
sell
5. https://medium.com/@MarutiTech/how-chatbots-
can-help-your-business-grow-32743b6b4da
6. https://chatbotsmagazine.com/11-examples-of-
conversational-commerce-57bb8783d332
7. https://www.entrepreneur.com/article/286079
8. https://blog.keyreply.com/7-great-ways-to-add-a-
chatbot-to-your-business-19e9afce4a5c
9. https://www.entrepreneur.com/article/294418
10. https://www.pypestream.com/blog/5-chatbot-
challenges-overcome/
11. https://chatbotslife.com/inhouse-vs-outhouse-
when-to-use-a-sdk-678f4e8a6345
12. https://venturebeat.com/2016/10/10/heres-how-
much-it-costs-to-make-a-chatbot/
13. http://www.fipp.com/news/insightnews/how-to-
develop-your-chatbot-strategy
14. https://www.linkedin.com/pulse/bot-how-use-
chatbots-your-small-business-lauren-maffeo
15. https://chatbotslife.com/chatbot-vs-ai-bot-which-
is-here-to-stay-which-to-invest-in-and-why-
7ea79a454df3
16. https://rubygarage.org/blog/how-much-does-it-
cost-to-build-a-chatbot
17. https://chatbotslife.com/chatbot-vs-ai-bot-which-
is-here-to-stay-which-to-invest-in-and-why-
7ea79a454df3
18. https://www.forbes.com/sites/blakemorgan/2017/
03/21/how-chatbots-will-transform-customer-
experience-an-infographic/#5379fcd7fb4a
19. https://blog.ownerlistens.com/2016/05/chat-bots-
challenges.html
20. https://www2.deloitte.com/content/dam/Deloitte/
ie/Documents/ie-dispruptive-chat-bots.pdf

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