The Pros & Cons of Using Chatbots for Your Business

Eric Kazda  |   August 8, 2018   |  Posted in Buyer Persona

We are always on the lookout for new technology that has the ability to revolutionize the online marketing experience. Chatbots are one of those innovative technologies with a ton of potential. Today we’re breaking down chatbot pros and cons for businesses. These positive and negative attributes may help your business decide if it’s worth investing in chatbot technology.

What is a chatbot?

Chatbots are software that’s designed to hold a conversation with a human for a specific purpose. In the business world, that purpose is often to deliver customer service.

If you would implement a chatbot for your business, you could choose to build on existing software or build a custom bot from scratch. You would also have the choice to build a bot based on AI (artificial intelligence) or a pre-written keyword prompt. The AI version delivers superior performance but is not as simple or affordable to implement.

If you want to use this virtual, automated communication for your business, make sure you know the main chatbot pros and cons.

Pros to using chatbots for business

1. Bots allow you to deliver consistent customer service

How do you compete with the Amazons of the world in customer service? A chatbot is a good start. The customer-facing applications can provide a consistent and fast experience across the board. No waiting on-hold for hours or waiting for the office to open to resolve your issue.

2. The combo of AI and personal interactions can provide valuable insights & data

Marketers and businesses are obsessed with customer data, and for good reason. Real data is what allows you to make educated decisions – not guesses. We talk a lot about this concept in our solutions-based marketing presentation. A bot can help you get to know your customer better. Just make sure you gather the right analytics from your bot. Here are a few ideas:

  • If your bot requests a conversation, how many customers accept?
  • If your bot sends a link, how many customers click on it?
  • How many customers are using the bot more than once?
  • Is there specific language or content that drove more conversions?
  • Did the customer complete your desired conversion?

3. The bot could save you money in comparison with traditional customer call centers

When you factor in the office space, customer service rep salaries, and human resources necessary to staff a fully operational call center, a bot could definitely save you money. It doesn’t request a salary and it certainly doesn’t need a lunch break. We recommend every business considering a chatbot conduct an analysis to see if it saves you money in the future.

4. Customers can reach you any time of day, regardless of personnel hours

What are your business hours? If you don’t staff your business 24 hours, chatbots provide a unique opportunity to reach customers even when you aren’t at work. No one likes waiting to get an answer to their question or to follow through on their intended action. Chatbots allows customers to forgo that wait.

5. Bots appeal specifically to millennials

60% of millennials in a recent study have interacted with a chatbot, and of those users, 70% enjoyed the experience. Chatbots provide another means of connecting with this elusive group of customers. The bot provides instant feedback and is remarkably convenient if you don’t want to spend your lunch break waiting on-hold.

3 Cons to using chatbots for business

1. The bots can have trouble when customers go off-script

Chatbots may be smart, but they aren’t human. They can’t read sarcasm in text and may get confused if the customer goes off their pre-programmed script. This article does a great job of explaining why the bots fail in various scenarios.

2. They work better for straightforward business services

If your sales model is straightforward and/or linear, chatbots could easily increase conversions. However, not every business model revolves around simple conversions like ordering food delivery or purchasing new clothes. Chatbots excel in these straightforward communication scenarios. If your business model is more complex or requires in-depth consultations before purchase, and chatbot will likely not help your conversions.

3. They appeal to specific audiences

One of the positive features could also be negative. Millennials react positively to chatbots, but as the demographic ages, it loses its popularity. If your primary customer base is older, they will likely be resistant to new forms of communications – including chatbots.

What’s your opinion on chatbots?

Do you think they are revolutionizing the customer experience or a passing trend? Let us know in the comments below!

Person chatting with chatbot in mobile phone vector illustration, flat cartoon smartphone with chat bot discussion, cellphone messenger with chatbot service, communication technology
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Eric Kazda

Eric Kazda is a leading expert in the interactive development industry with over fifteen years of experience. With a mastery of critical development technologies, Eric has crafted innovative award-winning work for clients both large and small. Coupling this knowledge with a real world understanding of usability and technological feasibility, his work is developed to be accessible by every user.