Why chatbots are not for retail?

 

The pandemic has forced businesses to quickly adopt new technologies. When forced to face the might of the pandemic,  retailers started opting for off-the-shelf products like chatbots without recognizing its limitations.

As AI and machine learning make significant leaps, retailers may have to pivot from the standardized chatbot setup they’ve integrated into the business to see a significant uptick in sales. Chatbots work for businesses that have a smaller number of SKUs, limited interaction with their customers, and have a simple buying process, like a subscription service. But chatbots don’t work in an industry like big-box retail where thousands of product options are available and the buying process is complex with several avenues for cross-selling and up-selling.

 

Why chatbots aren’t the right fit for retail?

There are many reasons why chatbots don’t work for the retail space: 

 

• Chatbots can only respond to very specific product requests. 

 

Chatbots are programmed to only answer specific product requests. If you veer too far from the script that it has been programmed to answer, the chatbot is unable to comprehend the request. Despite the customer’s many attempts to ask the right question, the chatbot is likely to respond with, ‘I don’t understand the question’, every single time and not give the customer the information about the product that they have in mind. 

 

• Chatbots may not be able to follow different accents and make things worse.

 

Auditory chatbots may not be able to follow accents which can complicate matters for retailers. Chatbots can speak with customers in English but they do not understand the different accents and nuances that customers may have, especially in a multicultural society like the US. The programming for a chatbot tends to be rigid and therefore, its ability to learn, understand and follow accents are also limited. This means that they will be unable to follow a conversation and might end up suggesting a product that the customer is not asking for and make matters worse.

 

• Most chatbots provide stilted responses.

Chatbots might have copious amounts of data under their belt but are unable to synthesize it to create meaningful conversations with customers. Because they are powered by simple keyword recognition and are not backed by AI/ML and natural language processing, they fall short in the retail space. Customers also tend to hate dealing with chatbots because they fail to mimic the human approach to solving a problem. 

 

• A chatbot can’t act like a real person and it shouldn’t even pretend to be one.

 

If the consumer figures out that it’s just a bot (and not an actual human) responding to their requests, they could either get frustrated or deliberately mess with the chatbot to incite responses that could create a sticky situation for a brand. Just ask Microsoft about Tay.

 

• Chatbots are a bad fit for complex questions and tend to make users uncomfortable.

 

In retail, the buying and pricing process is complicated and even customer requirements are varied and multifaceted. Most customers tend to get frustrated with chatbots because they are unable to follow complex questions and circumstances. They are awkward with their responses which makes users uncomfortable and unwilling to get their concerns resolved through a bot.

If not Chatbots, then What?

The retail sector is unique: it needs digital engagement with high degrees of personalization. 

Chatbots might be able to create digital engagement but are unable to create fruitful, personalized experiences. Instead, the solution is to have a virtual sales assistant that is backed by AI and machine learning. This form of AI is far more versatile than a chatbot and is able to help with every rung of the user experience.

Because they are more advanced than run-of-the-mill chatbots, virtual sales assistants can go above and beyond simple requests and responses. It can better understand your customer’s intent and the context behind their language because it is backed by natural language processing. 

With Smart Management, the virtual assistant can safely manage multiple applications and safely access the full range of the retailer’s product catalog. This will also enable efficient interactions internally within the retailer’s setup and externally with customers.

With Conversational AI, the range of interaction is vast. A virtual sales assistant can be used to create an omnichannel experience and can support multimedia, enhancing user experience. Conversational AI can be leveraged to cross-sell and upsell from the company’s catalog and make recommendations based on the customer’s order history.

Chatbots may, on the face of it, save on customer service costs but may risk the retailer’s conversion rate and impact the lifetime value of their customers. 

By channeling the power of Conversational AI, CoreView is always a step ahead and can help your organization integrate a sound, seamless solution to suit its business needs. 

Drop us a line at – info@coreviewsystems.com for a complimentary strategic consultation.