Chatbots - Relevance Now, Use, and Types of Companies Using Them
Chatbots are relevant now because they offer companies significant cost savings, they help companies improve customer engagement and experience, and there are advances in artificial intelligence and natural language processing that enable the development of more effective chatbots. They are being used most often in customer and after-sales services, customer relationship management, and sales and marketing. Chatbots are prevalent among companies that operate in the healthcare, communication, and financial service industries.
Why Chatbots Are Relevant Now
- In 2017, consulting firm Accenture polled 97 chief information officers (CIOs) and 255 chief technology officers (CTOs) from 12 countries, namely, Australia, Brazil, China, France, Germany, Ireland, Italy, Japan, Singapore, Spain, the United Kingdom, and the United States. Based on this survey, of CIOs and CTOs worldwide, 56% report that chatbots are disrupting their industry, 43% say chatbots are already being implemented by their competitors, and 57% believe chatbots have a high return on investment (ROI).
- Software company Salesforce, conversation marketing expert Drift, social media agency myclever, and survey authority SurveyMonkey Audience surveyed 1,051 adults in the United States in 2017, and found that the majority of adults in the country associate chatbots with the following benefits: quick answers to simple queries (69%), 24-hour service (62%), and convenience (53%).
- According to technology consulting firm Juniper Research, chatbots helped companies in the United States save $20 million in 2017.
- There are several market forces driving the growing relevance of chatbots, says professional services firm Deloitte. On the demand side, there is increasing pressure on traditional contact centers to reduce turnover rates and operating costs, and there is growing consumer demand for self-service. On the supply side, there are technological advancements in the areas of artificial intelligence and natural language processing, and chatbot development platforms are maturing.
- According to software development company IQVIS, chatbots enable 24/7 customer support, timely responses, customer engagement improvement, and customer service cost reduction. IQVIS reports that chatbots can reduce customer service cost by 30% to 70%. Chat interaction costs only $8 to $10 per session, while phone interaction costs anywhere between $35 and $50 per session.
- Based on IQVIS's report, chatbots are associated with the following salary savings in the United States: insurance services (60%), financial services (46%), sales (36%), and customer services (30%).
- Market research firm Mordor Intelligence reports that the global chatbot market was already worth $864.9 million in 2017. According to the firm, this market is growing at a relatively high compound annual growth rate of 24.1%.
How Chatbots Are Being Used
- According to Accenture's worldwide survey of CIOs and CTOs, chatbots are most commonly implemented in after-sales and customer service, customer relationship management, and sales and marketing. The following figures show the percentage of CIOs and CTOS worldwide who have already implemented chatbots in certain functional areas: after-sales and customer service (77%), customer relationship management (54%), sales and marketing (40%), audit, finance, and accounts (11%), human resources (8%), finance (8%), supply chain (5%), research and development or product development (3%), manufacturing (3%), and information and communications technology (3%).
- Prominent chatbot use cases, according to digital solution provider Cognizant, include the delivery of personalized or customized offers, products, and services in financial services, the delivery of government services, the delivery of product recommendations, product information, and store location in retail and e-commerce, and the delivery of travel assistance in travel and hospitality.
- In the workplace, chatbots and intelligent assistants are being used to support the following tasks: typing with voice dictation (46%), team collaboration (26%), employee calendar management (24%), email management (14%), customer service (14%), information technology help desk management (13%), and data analysis (10%). This is according to information technology marketplace Spiceworks, which polled over 500 information technology professionals across Europe and North America.
- Among consumers worldwide, chatbots are most commonly used for tracking an order (60%), finding basic information (53%), and asking basic questions (49%). This is according to software company Pegasystems Inc., which polled 3,500 consumers from around the world.
- According to professional services firm Ernst & Young, chatbots have helped users with tasks in the following areas: customer service and support, e-commerce, personal assistance, productivity, entertainment, and information gathering.
What Types of Companies Use Chatbots
- Accenture's global survey of CIOs and CTOs reveals that informational chatbots are most common in the health, communications, and banking industries. According to this survey, the percentage of CIOs and CTOs reporting use of informational chatbots is as follows: health (64%), communications (59%), and banking (50%).
- Based on Spiceworks's survey, the use of chatbots or intelligent assistants in the workplace is more common among large businesses than among small and mid-size businesses. According to the survey, 24% of large businesses use chatbots, while only 16% of small businesses and 15% of mid-size businesses use chatbots.
- Product support platform Boomtown, however, has a different finding. Using a sample of over 20,000 global businesses, it found that it is the smaller companies that deploy chatbots more frequently. Of businesses with chatbots, 39.2% have 1 to 10 employees, 32.0% have 11 to 50 employees, 16.3% have 51 to 250 employees, 3.6% have 251 to 1,000 employees, and 8.9% have over 1,000 employees.
- According to Boomtown, chatbots are slightly more prevalent among business-to-business (B2B) companies than among business-to consumer (B2C) companies. Of sites with chatbots, 58% are B2B sites, while only 42% are B2C sites.
- Boomtown also found that chatbots are overwhelmingly more prevalent in the internet software industry than in other industries. Of sites with chatbots, 65.1% are in the internet software industry, 8.4% are in the professional service industry, 6.6% are in the healthcare industry, 3.9% are in the discretionary consumer goods industry, 2.7% are in the media industry, 1.9% are in the consumer staples industry, 1.7% are in the hotel and leisure industry, and 9.7% are in other industries.
- According to Ernst & Young, chatbots have been used in the following industries: banking and insurance, enterprise, retail, travel, food and restaurant, education, accounting, news and media, toy industry, law, healthcare, and movie industry.