Are Chatbots the newest way to boost online sales?

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Updated on: January 10th, 2023Frank Falco6 min read

Are Chatbots the newest way to boost online sales? They have become very common in the marketplace and younger generations are certainly comfortable using them. But, does that mean it is time to jump on the chatbot train? As a top web development company, we wanted to share our thoughts on the topic about if and how chatbots can boost online sales.

While chatbots were a very buzzy idea in 2016, some of that shine was dulled last year. However, like most technology buzz, it is very hard to meet the expectations of excessive hype. But, with more businesses actively using chatbots in the marketplace we are now able to see how effective they can be.

What exactly is a Chatbot?

In a nutshell, a chatbot is a computer program which can conduct a conversation via text or auditory methods. They can vary from very simple to highly sophisticated. In the current context, these programs are often accessed through a virtual assistant such as Amazon Alexa or Google Assistant.

Everything started back in 1950 when Alan Turing developed the Turing Test, which was a method to test a machine’s ability to utilize intelligent behavior similar to a human. From there, things progressed relatively slowly with a new breakthrough made about every decade until Siri was launched as an iPhone app in 2010.

From that point development has taken off with various companies developing and launching their own chatbots, often paired with a virtual assistant or messaging app, to help provide a unique experience for users.

Recent studies have shown an increased acceptance of chatbots in the marketplace. This appears to be primarily due to comfort combined with the younger generation’s natural recognition of technology as part of life. With Apple, Google, Amazon, and Facebook all utilizing chatbots, they have become normalized enough that more businesses are either using or planning on developing chatbots.

Ways a Chatbot boosts online sales

There are quite a few ways which chatbots have been effectively incorporated into the sales process. Most commonly they are deployed in an effort to improve customer engagement. This is important because statistics have shown that engaged customers make almost two times as many purchases.

Here are some of the best ways a Chatbot can help increase online sales:

  • Streamline ordering – When a chatbot is paired with a messaging device, which Facebook does, or a virtual assistant, it can save the user time and effort. Rather than using multiple apps to perform a process, such as ordering something, it can be done with one bot. The most common example would be using Alexa to order products from Amazon. The food service industry has also gotten on board with using chatbots as Domino’s, Taco Bell, and KFC is each utilizing bots in different ways.
  • Streamline returns – The shopping process is never perfect. In fact, about 30% of e-commerce purchases are returned which means a decent amount of time and energy is spent by a business which only increases as sales increase. Chatbots can be used to help set up returns, receive complaint notifications, and provide information on the return process to alleviate some of the time burdens.
  • Provide product suggestions – In some cases, product suggestions can be annoying, however, when your bot has access to purchase records and browsing history it can become very helpful in comparing popular items other’s have shopped for while removing things you have already purchased and added things you might have looked at before. Victoria Secret is utilizing Kik to provide a fashion concierge service for customers.
  • Provide answers – One of the best things about chatbots is that they are available 24/7 which includes weekends and holidays. Even if you aren’t working, they can be, providing answers, FAQs, etc to help reduce shopping cart abandonment or site bounces when customers have questions but nobody is available for a live answer.
  • Provide fun options – Fun options are one of the best ways to engage users. Bots can perform a variety of fun functions such as playing games with customers, facilitating product giveaways or even acting as a meme generator.

The proof is in the pudding

When it comes to why you should consider using a chatbot, the proof is in the pudding. Top businesses in numerous markets are effectively utilizing bots on a variety of levels which tells you they work.

When Apple first launched Siri people were understandably skeptical about the usefulness and acceptance in the marketplace. However a few years later we find chatbots have integrated into all sorts of businesses.

Along with the references we have already included, chatbots can be found in the food, beauty, and fashion industries. Estee Lauder, Sephora, Gap, Narvar, True Fit, and HelloAva utilize chatbots to better serve their customers and increase sales.

Even the National Parks Depot uses a chatbot.

The bottom line

The bottom line is that chatbots are definitely a part of our technological society and chatbots are the newest way to boost online sales. Studies have shown not only increased satisfaction from customers interacting with chatbots as they become more sophisticated but also better response times and lower cost per interaction. When you combine that together you end up with increased engagement and reduced overhead costs which ultimately results in a healthier bottom line for your business.

Be sure to check back every week for great new Lounge Lizard blog articles.

Published on: April 16th, 2018
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