10 Reasons Why you Should Use Chatbots
By Joren Wouters • Updated on
Chatbots are becoming more popular every day.
But there are still many companies that don’t use chatbots.
That’s why I am going to break down the 10 reasons why you should use chatbots.
Together with real-life cases and incredible results.
Let’s dive in!
Why should you use chatbots?
Save time and money on customer service
This is the most important reason why chatbots are used nowadays.
Chatbots can save a lot of time and money on customer service.
80% of customer service questions are standard questions, which could be easily answered by a chatbot.
The result? You can save 80% of your time and costs on customer service because now you only need humans for custom and personalized questions.
Research by Business Insider showed that using a chatbot for customer service can lead up to 29% – 46% cost savings.
IBM even found in a recent study that a chatbot reduced costs by 30%.
But how to do this?
Really simple. Let the chatbot answer standard questions, such as:
- What are your opening times?
- How can I make an appointment?
- What is the price of your product?
Boost your sales
With a chatbot, you can directly sell products to your customers. You can even let them pay for your products in the chatbot.
Another way to boost your sales is to promote your products or services in your chatbot.
But how do you do this?
Good question. Let’s see how Argomall did it.
How Argomall increased their ROI by 23x
Argomall is one of the top eCommerce sites in the Philippines, selling authentic customer electronics. They have a catalog with over 3,000 products and more than 200K likes on their Facebook page.
They noticed that more and more people wanted information about their brand and products via Facebook Messenger.
So, they decided to build a chatbot that did three things:
- Answer Frequently Asked Questions
- Guide users through the shopping process
- Allows users to complete a purchase within the Messenger app
The results? These are huge:
- 23x increase in ROI in the first three months
- 10% increase in product sales from Messenger
You may think, “Oh 10%? That is not much”. But with the number of users that Argomall has, this means big bucks.
More cases to boost your sales
Argomall is just an example, but there are way more use cases with a chatbot to increase your sales.
Think about:
- Giveaway campaigns via Facebook Messenger
- Contests and quizzes
- Sending abandoned cart messages via Messenger
Get more leads
Next to saving time and costs and boosting sales, we can also get more leads with a chatbot.
What is commonly used is to make a Facebook ad and combine it with a chatbot.
People who respond to the ad, automatically get a message from the chatbot in Facebook Messenger and convert them to a lead.
Let’s see how a local Mexican Restaurant did this.
How a Mexican Restaurant generated 85¢ leads
The local Mexican restaurant Fiesta Mexicana first made a fun and creative Facebook ad:
When they clicked on the ad, they got the following message:
So this clearly is a contest, where only one person can win.
But what do you offer the losers?
A coupon for a free appetizer!
The goal of the coupon was to draw more people into the restaurant and turn them into long-term customers.
And it worked.
From the 173 people who opted in:
- 33 users immediately redeemed the coupon
- 30 users redeemed the coupon after a reminder
- Another 30 clicked on “Not this week”, but wanted to come to the restaurant
So, a lot of leads for only 85¢ per lead!
But now you might think “This works for small companies, but what about big ones?”
Let’s have a look at Nissan Israel.
How Nissan Israel sold $380K in their first month with a chatbot
Nissan Israel received hundreds of questions through Facebook Messenger every month.
They needed to answer these messages manually, which lead to a delayed response.
And to make things worse, they weren’t qualifying these leads, because they had no system in place.
Next to getting more leads, you can also automatically qualify leads with a chatbot. And that is exactly what Nissan decided to do.
Nissan Israel made a chatbot in which they asked 3 questions to the user:
- Which of these models do you like?
- Is your mind already set on this model?
- What is your phone number and email address?
And the process was extremely simple:
- Ask the questions to the user
- Determine if the user was ready to buy the car
- Ask for their phone number and email address
- Send an email to the Sales team of Nissan Israel and they convert them to a customer
The results speak for themselves:
Reply in seconds, instead of days
Ever asked question to a company and they replied days later?
Annoying, right?
You are not the only one.
90% of consumers rate an immediate response as important or very important when they have a customer service question.
But what is immediate? 10 minutes or less.
So consumers want an answer, and they want it fast.
With chatbots, you can reply immediately to a question of the user.
And it doesn’t matter if you need to serve 10 users or 10,000 users.
Chatbots can handle it. And they can easily scale up and down.
Let’s see how HelloFresh increased its response time by 76%.
How HelloFresh increased its response time by 76%
HelloFresh delivers fresh ingredients to your door along with instructions on how to cook them. It is a subscription service that helps people to enjoy healthy, home-cooked food.
But they faced two problems:
- High volume of incoming messages
- Slow response times
It took their support team between six and twelve hours to resolve those customer issues.
And as you can read above, that is far too long.
So they decided to make a chatbot that:
- Was connected to Facebook ads
- Automatically replied to Facebook comments
- Instantly replied to user questions
- And even recommended music to its users
It all lead to a 76% increase in response times, while they got 47% more messages on Messenger overall.
As I said before, chatbots can easily scale.
24/7 available, everywhere
Had a good night of sleep, last night?
Yeah, me too.
But do you sometimes think about customers who are awake when you are asleep?
If they have a question, they cannot ask it to you. Because you are asleep.
This is even extra relevant for companies that are active in multiple markets with varying timezones.
With a chatbot, there is always someone who responds to your customers.
24/7 available.
Then, customers can talk to your company wherever they are, whenever they want.
Research even found that it is one of the main benefits of chatbots:
Send real-time, tailored messages to customers
Imagine. It’s Friday, the sun is shining and it’s great weather to hang out with your friends.
But then you get a notification on your phone and you see this message:
How likely would go to that bar and enjoy the sun with your friends there?
Very likely.
This is an example of realtime marketing. Realtime marketing is focused on providing content on up-to-date events and actuality.
Chatbots are really good at this.
Providing just the right message, at the right time.
Messenger apps become more popular
Messenger apps, such as Facebook Messenger and WhatsApp are becoming more popular every day.
They have grown so much, that they even surpassed social networking platforms:
So, people spend an increasing amount of their time on messaging apps. How is that good for chatbots?
Because chatbots are integrating well with those platforms.
You can easily create a chatbot on a messaging app, such as Facebook Messenger or Twitter.
Your customers are already there, you just need to message them.
People are open to chatbots
A lot of people don’t really care whether they are talking to a human or to a chatbot.
As long as they get good help.
They just want one thing: an answer to their question.
A solution to their problem.
How they get it?
Doesn’t matter, as long as it is good and quick.
Research by Hubspot showed that 40% of respondents said that it does not matter, as long as they get help quickly and easily:
But there is more:
- 47% said that they would buy items from a chatbot
- And 37% said that it would buy items from Facebook
With a chatbot, you can have a salesperson that is 24/7 available, ready to sell your products to potential customers.
Use internally in your company
Next to all the motivations for using a chatbot focused on customers, you can also use a chatbot internally within a company.
This is especially useful for larger companies with multiple departments.
Larger companies often have multiple software systems.
A different system for HR, another one for fulfillment, purchases, marketing, etc.
Then you could use a chatbot that explains how you should use all these different systems to new and existing employees.
You can also go one step further and completely replace certain systems.
Instead of the employees interacting with the systems, they could tell the chatbot what to do. Then, the chatbot takes care of it.
Let’s see how Facebook used an internal chatbot to answer employees’ concerns.
How Facebook responded to employees’ concerns
In 2019, some Facebook employees were concerned about answering difficult questions from friends and family.
What if someone accused the social network of destroying democracy?
Or said that Mark Zuckerberg was collecting their data at the expense of privacy?
To handle such hard questions, Facebook made its own internal chatbot: Liam.
For example, if someone asked how Facebook handled hate speech, the employee could say:
- Facebook consults with experts
- It has hired more moderators
- It is working on AI to detect hate speech
- Regulation is important for addressing the issue
Useful, right?
Stand out from the crowd
And this is the last, but maybe one of the most important reasons.
How many companies already use chatbots?
Think of it.
The truth is, not a lot of companies are already using chatbots.
And yes, there are a lot of big predictions.
Gartner predicted that 85% of customer support interactions will be performed by a chatbot in 2020.
And Business Insider predicted that 80% of businesses have some sort of chatbot automation by 2020.
But we are now in 2020 and I can tell you, 80% of businesses don’t use chatbots.
It is much less.
I spoke with several chatbot experts on my podcast and most of them stated that only 20% – 40% of companies use chatbots nowadays.
So here lies an opportunity.
While your competitor replies in days, you can reply in seconds.
If other companies are asleep and not responding to customers, you can have a chatbot that is 24/7 available.
When other companies spend thousands of dollars on customer service reps, you save on costs and deliver a better user experience.
You can stand out from the crowd in your market.
Now, it is your turn.
Now It's Your Turn
Are you already using chatbots?
If not, are you convinced that you need to use them now?
Either way, leave a comment below right now.
