Customer Service Glossary

What Is a Retail Chatbot?

A retail chatbot is a specially designed software program that simulates human conversation while interacting with potential and existing customers. The artificial intelligence-powered robots use machine learning and natural language processing (NLP) to provide customers with personalized care and help recreate an in-person buying experience.

Retail chatbots eliminate contact forms, long response times, and the impersonal feeling of shopping online. Instead, customers can receive immediate assistance from a friendly, helpful voice while searching for a specific product or requesting information.

Retail chatbots can streamline and optimize the customer experience and support the buying process. The software programs make it easy to scale online businesses without sacrificing quality or consistency. In addition, retail chatbot technology can help improve customer satisfaction and brand loyalty by creating positive experiences throughout the buyer’s journey.

Why Are Retail Chatbots Important for Customer Service?

Retail chatbots help address some of the critical problems that online shoppers face each day. For example, customer-centric companies can leverage chatbots to provide quick solutions to minor issues, offer timely customer support, and ensure a convenient buying experience without the need for a live agent.

Other benefits of retail chatbots include:

1. Reduced Costs

Interactive retail chatbots lower customer service costs by as much as 30%, thanks to rapid response times, 24/7 availability, and reduced need for extra agents. In addition, chatbots can provide suitable solutions for as many as 80% of customer inquiries. As a result, live agents can prioritize sensitive or concerning issues instead of answering common questions.

2. Improved Customer Satisfaction

Businesses can incorporate retail chatbots in countless ways, including Facebook Messenger, pop-up chat windows, and embedded instant messaging apps on their retail website. No matter which platform they use, organizations can expect an uptick in client satisfaction rates for several reasons.

First, chatbots are immediately available around the clock. Customers no longer have to wait for hours to determine where their package is, when their return will be processed, or if a product is available.

Secondly, chatbots draw from past interactions, shopping history, and analytics to create a seamless consumer-retailer relationship. As a result, customers can obtain relevant assistance without repeating details or locating past order information.

3. Cohesive Customer Experience

AI-powered retail chatbots help ensure a consistent, cohesive customer experience, especially when businesses take the time to tailor the bots to suit their customers’ needs.

Chatbots come fully equipped with the machine learning processes needed to chat with customers through Facebook Messenger or another type of instant messaging technology. However, businesses can tweak responses to suit their voice, brand, and customer support strategy.

4. Increased Brand Loyalty

When most companies and consumers think of chatbot technology, they immediately consider customer service. Still, chatbots can help other departments and functions, including sales, marketing, and product development.

Chatbots support marketing strategies by providing potential leads with immediate access to the products, services, or information they desire. These bots can also help qualify leads and point customers to the best resource or communication channel to finalize a sale.

Finally, and perhaps most importantly, this technology allows customers to receive timely assistance without any lag time, providing a significant advantage over competitors.

Types of Retail Chatbots

Businesses can choose from a variety of chatbot platforms, including popular options such as Facebook Messenger’s bot API, Slack’s Slackbot, or Shopify’s Kit. Regardless of the hosting platform, chatbots typically fall into one of two broad categories:

1. Rule-Based Chatbots

Also known as “task-oriented” chatbots, rule-based retail chatbots have limited, scripted interactions with customers. Rule-based chatbots can only answer basic questions, such as queries regarding product availability or store information, or share menu options.

2. Data-Driven Chatbots

Data-driven, or predictive, chatbots use machine learning, natural language understanding (NLU), and natural language processing (NLP) to carry on human-like conversations, assist with more complex questions, and perform other functions, such as lead qualification and sales support.

Why Businesses Choose Retail Chatbots

Customer-centric companies around the world turn to retail chatbots for enhanced customer satisfaction, improved sales, and faster response times. The intuitive technology helps customers search for products, locate purchases, and return items easily. Further, retail chatbots reduce customer service costs by streamlining operations and handling as many as 80% of customer inquiries without the need for a live agent.