Will conversational commerce be the next big thing in online shopping?

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M.ESSAGING IS ON intimate medium to share private views and feelings. It’s a cocktail party whisper in digital form, as a user of WhatsApp, a Facebook service, put it. Now some of the biggest brands in the world are venturing into this personal space. A few years ago, aware of the limits of conventional communication channels such as call centers and e-mail, companies began using WhatsApp and its sister app Facebook Messenger as well as Apple’s iMessage and independent apps such as Line.

The pandemic gave a boost to all of these apps. Message delivery on Instagram, Facebook’s photo sharing app and Messenger increased by 40%. Four fifths of the time on mobile devices is now spent on chat apps. Organizations can usually rest assured that they will go where customers are. As a result, messaging has become not just experimental, but essential for companies, says Javier Mata, founder of Yalo, a startup whose technology connects companies with messaging platforms. In the past, companies used them mainly for customer service. Now they want to get people to buy things through chat like hundreds of millions of Chinese do on WeChat, owned by Tencent, China’s most powerful technology giant.

Since many popular messaging platforms are encrypted, data about transactions is difficult to obtain. But growth is undoubtedly taking place. Over 1 billion people now chat with businesses, not counting China. Every day, 175 million people send a message to WhatsApp business accounts (WhatsApp channels for businesses). Yalo’s customers include consumer goods giants such as Coca-Cola, Nestlé, PepsiCo and Unilever, as well as Walmart, the world’s largest retailer. Apple Business Chat, launched in 2017, is used by Home Depot Home improvement Stores, Hilton Hotels and Burberry, a fashion brand. Facebook’s list includes Sephora, a cosmetics retailer, and IKEA, a furniture giant. LVMH, a French luxury goods company, is testing messaging, said Jeroen van Glabbeek, CEO of CM.com, a Dutch conversational commerce platform.

In Asia and Latin America, “C-Commerce” is already firmly anchored, where incomplete access to broadband and high-quality devices makes e-commerce and company-specific apps inaccessible for many. Now, western consumers are starting to appreciate the simplicity, speed, personalization, and convenience of messaging. For companies, the return on investment seems to be higher for messaging than for call center exchanges or email chains, says Emile Litvak, head of business messaging at Facebook.

Business messaging boosters claim that c-commerce will supplant e-commerce in a decade or two. But messaging is best understood as a refinement of e-commerce and a sibling of “social commerce” (shopping on social media). Most large business-to-consumer messaging conversations begin on corporate e-commerce websites that have a “Click to Message” button. Many start on social networks.

In a way, C-Commerce is a look back at the past. In addition to mail order and its modern look, online shopping, retail has relied on conversation for thousands of years. But business messaging has new elements. It’s more personal than SMS Marketing that has been successful even in America and Europe in recent years. Automatic messaging goes beyond rudimentary chatbots that have been around since the mid-2010s. Artificial intelligence (AI) is getting better and better at the unstructured exchanges that buyers used to have with seasoned retail assistants.

Right now, says Marc Lore, who led Walmart’s digital efforts, a lot of business news has people up to date. He’s calculating for the future AI will be able to answer customer queries as fuzzy as “Get me a birthday toy for a five-year-old with a science education for about $ 40,” suggestions on how to choose and complete the transaction in seconds. And when AI gets better in natural dialogue, as it will after learning from human interactions.

Until then, companies need to be cautious. Chat apps full of family and friends are emotional spaces, says Robert Bennett. CEO from Rehab, an agency that helps brands reach consumers digitally. Try selling someone yoga leggings after a swap with their mom, he says, and your company may be deleted quicker than an ex. But get it right – think of a gentle evening meditation reminder from an herbal tea supplier – and the rewards look delicious.

This article appeared in the business section of the print edition under the heading “Chat-up-Lines”


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