IT Services, Thought Leaders

The Myths and Realities of Bots in Your Business

September 14, 2018

by Hilary Thompson

Journalist

It's easy to create bots, but it can be difficult to wade through the pros and cons of investing in them. This article outlines the opportunities – and shortcomings – of using bots for business.

It’s no secret that bots are here to stay, but the question remains: should you use them in your business?

Emerging technology enables developers to create new bots with ease. And with little effort, developers can even create customized chatbots that help to streamline business operations.

In this article, we examine the pros and cons, myths and facts about using bots in your business.

What Are Bots?

Bots are applications that perform automated tasks such as setting an alarm, reporting the weather, or conducting web searches.

Developing a simple bot does not require significant effort or technical expertise. All you need to get started is coding that tells the bot how to behave.

Bots are built in one of two ways:

  • Rule-based approach: The developer hard codes rules into a bot. These rules allow the bot to make deductions or choices based on user input.
  • Machine learning: This approach involves the science of getting computers to learn and act like humans. The developer feeds a bot data and information in the form of observations and real-world interactions which the bot learns from and bases its interactions.

Each bot functions based on simple code formulas written by a developer. Depending on the code, the bot then performs a specific task. Most bots are only capable of providing the responses or actions coded into it.

The most common form of bots are chatbots, which simulate conversation. Chatbots are coded to respond to various forms of questions through text and provide answers in real-time.

Chatbots simulate real conversation.

The CNN bot, for example, tailors news stories to the reader’s preference based on the information provided by the users.

Coding a few rules or feeding data into the bot enables it to perform specific tasks. Bots work in a manner similar to human receptionists. As a user interacts with a bot and asks for assistance, the bot is the medium responding.

How Can Bots Help Businesses?

Artificial intelligence and machine learning have made significant advancements in recent years. Today, these advancements have led to bots that are more capable of emulating human conversations.

These breakthroughs have started to win over businesses: four out of five companies (80%) say they want bots as part of their operations by 2020.

Bots are becoming more popular for four key reasons. Bots:

  • Improve efficiency by automating work processes
  • Offer solutions for any industry
  • Support revenue goals
  • Boost customer service

Bots Help Automate Work Processes

Businesses can increase efficiency by investing in bots. People are prone to boredom when performing repetitive tasks--bots aren’t. There are already thousands of bots that can automate monotonous, dull tasks. Automating tasks increases employee productivity and saves time.

Key areas where bots can improve work processes include:

  • E-commerce and online marketing: Chatbots allow e-commerce websites to provide customers with a better shopping experience, while streamlining the majority of customer interactions. As a result, bots can help drive higher sales.
  • Customer service: In the near future, one-quarter of organizations (25%) will use bots as part of their customer service strategy. The continuous availability and faster response times bots offer provide customers with a more straightforward, faster experience. Additionally, companies that use bots in their customer service have seen significant cost savings.
  • Human resources and recruiting: Bots make it easier for companies to maintain high levels of employee engagement. Companies that incorporate bots into their HR strategy can improve each step of the employee lifecycle while simultaneously decreasing costs. Bots like Maya and SAP can automate recruiting tasks, saving up to 75% of HR teams' time, which ultimately reduces recruiting costs.
  • Personal assistance: Automation and bots are already shifting the way we work. As technology improves, so will the number of tasks bots will automate. Bots like Kit, NumbersBot, and Zapier are all examples of bots can automate repetitive, mundane tasks.
  • IOT and voice: Voice is quickly becoming more one of the more popular forms of bots. Businesses like Uber and Dominoes saw a massive increase in revenue by selling their services through voice technology.

As chatbot technology advances, automation will be extended into more business processes, which will enable organizations to increase revenue, boost productivity, and save time.

Bots Are Relevant in Many Industries

In addition to changing the way we work, bots are changing the way we live. If you’ve booked a trip or visited your bank’s website recently, you may have already encountered a bot.

The AI in bots is highly versatile and flexible. Because of this, businesses in virtually any industry can use bots. To switch functions or make improvements, all that’s needed are a few coding changes.

Bots in the travel, tourism, and hospitality industry are increasing customer satisfaction and brand loyalty while keeping costs low via automation. Marriott, for example, has grown 85% a month since launching their chatbot services.

Additionally, many major financial institutions have already started using bots, including Bank of America, Visa, Chase, and American Express. Bots and chatbots automate repetitive tasks and alert customers to potential financial problems.

Other industries, including health, real estate, and entertainment, have also adopted the use of chatbots and artificial intelligence. Conversational UI and the advancing capabilities of chatbots can be revolutionary in almost any setting.

Bots Support Revenue Goals

More businesses are recognizing the versatility and availability chatbot technology. As a result, they are using the technology to cut costs, increase revenue, and streamline the sales process.

Because one bot is equal to dozens of employees, they reduce the number of employees needed for specific tasks. As a result, employee expenses are lowered and revenue is increased while still providing customers with an exemplary experience.

The continuous availability of bots provides businesses with a unique opportunity to sell more products. Additionally, as bots get to know customers, they can tailor responses to shopper’s needs. This creates a better customer experience and increases revenue.

The Nordstrom bot, for example, allows shoppers to find the perfect holiday gift. Users simply answer a few questions and the bot returns personalized suggestions based on their input.

Shopping bots offer personalized suggestions.

Other bots have been designed to receive payment information, which allows customers to make payments without leaving their preferred app or program. This streamlines the payment process and provides a better customer experience.

As bot technology improves, chatbots will be able to provide more effective responses. This will help boost customer satisfaction and over time, revenue.

Bots Improve Customer Service

Customer service chatbots are becoming increasingly more popular. The technology allows businesses to interact with their customers, reduce employee workload, and provide valuable customer insight.

Chatbots provide customers with continuous availability. Customers wait an average of seven minutes before connecting with a customer service agent. Chatbots allow customer to avoid this wait by connecting customers with a virtual customer service agent in seconds. Reduced wait times can significantly improve customer satisfaction.

Additionally, businesses who utilize bots in their social media efforts have significantly improved their online presence. 1-800-Flowers for example allows customers to order flowers without contacting the store. Customers enter their order and the chatbot fills it.

1-800-Flowers uses bots to help customers schedule deliveries.

As a result, the brand has strengthened its relationship with customers by providing real-time support and simplified the buying process.

More and more businesses are choosing to incorporate as part of their customer service team. The biggest advantage of using chatbots for customer service is the ability the bot has to answer inquiries quickly, cheaply, and consistently.

Disadvantages of Using Bots

While bots may add significant value to businesses, they do not come without risks. Companies should always consider their specific goals and audience before investing in bots.

The disadvantages associated with bots fall into two main categories: audience problems and technology limitations.

Bots Don’t Work For All Audiences

Despite the flexibility of bots, they are not adaptable to every organization. Companies who provide specific services or handle predictable customer requests benefit the most from chatbots. B2B companies who offer personalized client advice won’t find the same human interaction in bots.

Statistics have shown that 61% of bot users are teenagers and 81% of users are from the United States. Organizations with an international or older audience may not benefit from using bots. The limited audience of bots may make them unpopular with certain demographics.

Bots are also unable to understand emotion. Even though bots are designed to interact with humans, they are not able to understand sarcasm, humor, or irony. Bots are only capable of understanding straightforward, genuine questions. Additionally, bots cannot remember past conversations, which may force users to enter information repeatedly which can be cumbersome for the user.

Finally, many customers, particularly the older generation, may prefer talking to a real person rather than a bot. Some users may not understand how to interact with a bot, which can create a negative customer experience.

While bots have their advantages, they do have their disadvantages. The inability to understand emotion, the limited audience, and user preference can be problematic for some businesses.

Bots Aren’t a Perfect Technology

Although chatbots have improved significantly over the past few years, the technology is still limited.

Bots are not able to perform beyond what they are programmed to do. Should a business want to develop a more complex, smart bot, years of programming and advanced technical skill is needed. Additionally, the more processes and responses a bot has, the longer it takes to build and set up. A lengthy waiting period can decrease revenue, damage customer relationships, and increase business costs.

Should your bot interface suddenly go offline or something broke, companies may not be able to provide user support. The humans behind the bots would be handling requests which may further slow recovery time.

Finally, despite the benefits companies have seen from bots, the future is uncertain. Bots may become the solution for cost reduction and automation, and they may not. Without continuous improvement bots may become irrelevant.

Despite the benefits the technology bring to businesses, significant improvements are needed to improve their functionality and make them suitable for any business.

To Bot or Not to Bot?

Despite the limited technology, there are specific benefits that bots can bring to businesses, including an increase in revenue and faster business operations.

However, the newness of the technology doesn’t make chatbots suitable for every audience or every business. They can be more cumbersome and costly for businesses to implement.

Whether or not bots are the right fit for your company, only you can decide. By considering the advantages and disadvantages of investing in bots, you can make a more informed decision for your business.

About the Author

Headshot of Hilary Thompson

Hilary is a freelance journalist, small business owner, and mother of two. She loves to write about everything from business to parenting, sleep disorders, tech, and stress. Coffee is her friend. You can follow her on Twitter @TypewriterHil.

 

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