Is the Use of Chatbots Resourceful or Reckless?

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A recent Harvard Business Review survey revealed that smartbots or chatbots are considered to be one of the top 7 uses of applied AI today. But are they ready yet? Companies could be taking a risk when they deploy these tools to their sales and service departments.

By cutting customer service costs through chatbots and other strategies, companies can make their budgets look more agreeable in the short-term, but if service quality is compromised, the financial effects will ultimately be punitive. According to research by NewVoiceMedia, U.S. companies lose $41 billion each year due to bad customer service. After a negative experience, 58% of consumers will never use the company again and 34% take revenge by posting a critical online review.

The temptation to use chatbots is understandable. Many customer service representatives are simply following prompts as they handle complaints, process orders, and provide information about products and services. Why not fully automate what’s already been partly automated through digital guidance?

Nikunj Sanghvi heads the US sales and business development for Robosoft Technologies. He told me that chatbots can respond to questions quickly, which is sometimes more reassuring than an auto-response saying, “Someone will get back to you soon.” Chatbots can learn from interactions with the consumer and can upsell and cross-sell products.

“Further, chatbots can also reduce the time to qualify a lead by asking them relevant questions, so when leads come to the sales/marketing team, they are already qualified. Chatbots can be beneficial not just in nurturing leads but also saving sales and marketing teams a lot of time, so it’s a win-win situation for both customers and businesses,” said Sanghvi.

However, chatbots are still an object of derision among some technologists and a source of consumer frustration. Although Siri is far more advanced than her primitive ancestors, such as MIT’s Eliza in 1966 or the deliberately paranoid chatbot PARRY in 1972, AI certainly hasn’t mastered the art of conversation.

“Chatbot technology is still evolving. Humans want to interact with humans, and largely bots have not been able to bridge that gap yet,” said Sanghvi. “Further, most users on your website have come there with the purpose of gathering information, and are not ready to move ahead in the sales cycle, and thus they see chatbots as an interference to their experience.”

Sanghvi continued, “The key is to make them not intrusive, but helpful – think of a real-world example of a helpful, informed store assistant who is available in the aisle to answer any questions you may have, instead of a nosy sales assistant who keeps bothering you when you want to browse in peace.”

“Chatbots are certainly becoming more robust than in the early days,” commented Dr. Andy Pardoe, Founder of the Informed.AI Group, a knowledge and community platform for the AI industry. “They are typically now enhanced with advanced Natural Language Processing that allows for variation in the language used, making them more adaptable and robust to natural conversations. They will understand the context and the intent of the conversation and request any missing information before being able to service a user’s request. The area of NLP is an active area of research at the moment, and people will continue to see the performance of chatbots improving over the coming months.”

But is the use of chatbots resourceful or reckless at this point in time? When chatbots fail to hold meaningful conversations, consumers sometimes become embittered. Unhelpful and unnatural chatbots fundamentally devalue the sometimes delicate handholding process of customer acquisition and customer retention.

However, AI is not without value. It is already changing sales and service departments — just not in the way you might think. Instead of providing the service, AI is currently being used to improve the service skills of human workers.

Michael Housman is the Co-Founder and Chief Data Science Officer at RapportBoost.AI, where he uses machine learning, A/B testing, and closed loop experimentation to improve conversational commerce. The company’s “emotional intelligence engine” guides companies through the nuances of effective communication.

“What are the attributes of the conversation that contribute to a good outcome? It’s looking at hundreds of different variables,” Housman said, as he walked me through the steps of his company’s process.

He continued, “Right now we are solely focused on human agents. ‘Cause you know the chatbot market isn’t quite there yet. But we make a habit of testing out every bot we can. And, you know, kicking the tires. And just generally, it’s not there. The technology is not super sophisticated. It can’t come up with answers on the fly. Oftentimes, just responding in the appropriate manner is a challenge.”

Chatbots are often insufficient because they fail to relate to people on an emotional level. “The EQ seems to go under the radar. People don’t think about it as much but we’re naturally social beings and that stuff matters a ton,” said Housman.

This does not rule out a future for more advanced bots. Housman told me, “We think if we can train human agents, and we can help them improve, there’s going to be huge opportunity down the line to be training bots with their EQ.”

When I spoke to Dr. Yoram Levanon, chief science officer of the Israeli company Beyond Verbal, he expressed a similar viewpoint. Beyond Verbal measures and analyzes vocal biomarkers for medical and commercial purposes. Dr. Levanon said that when customers are greeted by chatbots or artificial teleprompts, they often come away with the impression that somebody is trying to cheat them.

“Fraud. That means the voice that they are putting in the machine is not the right voice,” said Dr. Levanon. He said that companies need to ensure that friendly intonations are being used. “And yes we can also analyze the voice of the chatbot and tell the company, ‘Oh you have to change here and there and that. To make it more human.’”

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