Chatbots are AI-based software designed to simplify human-machine interaction through Natural Language Processing. In other words, a chatbot is a subtle way to automate some routine and time-consuming tasks. There are chatbots for different purposes: customer service, marketing, transactions, and entertainment. But this article is focused on chatbots for startups many of which now rely on this technology in business.
The value of chatbots for startups is immense: error reduction, time and cost efficiency, and satisfied employees. But there is even more to it. This article gives seven basic chatbot advantages any startup can leverage.
- Excellent customer service
The popularity of chatbot technology with eCommerce businesses is tied to its ability to improve the quality of customer service. On average, a chatbot can recognize up to 500,000 variants of human voice requests. Alongside texting, this feature makes it a perfect replacement for human agents who proved to be less skillful in dealing with angry and disgruntled clients. The potential of chatbots in enhancing customer service is enormous. Besides a faster average response time, chatbots serve hundreds of customers at a time, so reducing labor costs for business owners. Similarly, they don’t make errors which are typical for humans and are not affected by a stressful environment.
- Good for transactions
The growing use of chatbots in banking is a recent trend. Since people are willing to manage their finances with a smartphone, AI-driven chatbots are employed to ensure secure online payments. They are also needed to inform the user of policy changes or expiring free sessions. Likewise, many banks adopt chatbots to increase data security as they validate every single payment that users perform via internet banking systems. You should consider using chatbots in payment processing if you are concerned about your startup’s financial data security, and especially if you plan to set up business in the finance sector.
- HR assistance
This automation technology is equally used in recruitment agencies that count on chatbots to process high volumes of data from CV databases. In this case, chatbots are aimed to analyze candidates’ profiles and search through thousands of CVs with a view of detecting the best suited applicants. Besides recruitment firms, HR chatbots can be adopted in any company that plans to hire people across the world and with a different level of experience. For instance, many IT companies that grow rapidly at their early stage decide to use chatbot assistants to recruit IT specialists faster and therefore be able to complete more projects.
- Effective project management
Investing in a chatbot seems a good solution for all startups involved with project development. Chatbot software is needed to provide a favorable digital environment for teamwork and collaboration. It can help you schedule team meetings and create to-do lists, thus organizing your daily tasks more effectively. Similarly, the role of chatbots is important in ensuring that all team members stick to their deadlines and align with their project goals. This feature is of much use to project managers working with big teams. For example, scrum chatbots provide a sprint board that lets you classify and track project tasks and team performance.
- Lead generation
The chatbot technology is particularly appealing to eCommerce startups facing the struggle to provide perfect user experience. Chatbots, in this case, are the best solution as they are designed to deal with numerous customers at a time. As a result, it is easier to increase customer retention as prospects don’t have to wait until it is their turn to make an order. With a shorter average response time, more customers reach the final point of the marketing funnel and turn into leads, which eventually leads to a higher sales revenue.
Personalization is the key to superior user experience, and this is the reason why chatbots are widely adopted to create unique buying propositions and thereby build customer loyalty. Chatbots can be buyers’ personal assistants which analyze their needs and searches and based on that provide relevant offers that match their preferences. For instance, Sephora launched a bot that gives makeup recommendations and educational tips according to a buyer’s desires. This type of personalization improves the brand’s image and at the same time allows for better customer engagement.
- Cost savings
With such a wide range of applications, chatbots are gaining popularity. However, there is one more contributing factor to their extensive use. The chatbot technology also allows startups to cut down on their business expenses and labor costs. Automation greatly reduces the need for extra personnel and instead gives business owners a chance to invest in other business areas. This advantage is of paramount importance for every company at the early stage as investing in the right things speeds up startup’s growth and leads to a firmer foothold on the market.
Why are chatbots so popular?
The growing use of chatbots in business is to some degree explained by the changing consumer behavior. Consumers become more tech-savvy and expect businesses to use technologies in communication and interaction with them. Today, most millennials stand for technology use. They feel more comfortable texting about their needs than speaking to a human agent. This change in behavioral patterns push startup owners to build their businesses on technology, including chatbots, that allows for automation and productivity.
Will chatbots replace humans in the end?
Despite an increasing trend for replacing humans with chatbot assistants, it touches upon only routine and repetitive work that does not require creative input and complex decision-making. It is true that chatbots have penetrated many areas of business, but their functionality remains limited and supervised by humans. Based on that, chatbots should be regarded as smart helpers but never as a threat to human intelligence.