Sydney 30 November, 2016 – Conversational Commerce company, Flamingo Customer Experience Inc, today released research into 84 Australian based businesses as well as 528 Australian consumers and their views on and experiences with Chatbots. A Chatbot is defined as a computer program, based on rules or Artificial Intelligence, that simulates conversation with human users over the internet. The research was commissioned by Flamingo, conducted by Fifth Quadrant and sponsored by SugarCRM.
Results show that 77% of consumers are comfortable to very comfortable with the concept of using Chatbots when interacting with organisations. About the same percentage of businesses, 73%, believe Chatbots are somewhat to very relevant to their business.
The research also shows that the first generation of online customer assistance and help tools have largely failed to deliver tangible results for businesses with 60% of consumers having abandoned an online application or purchase process in the past three months.
“This research has brought to life the fact that pricing, complicated processes and website navigation are key obstacles in preventing customers from finalising an online purchase or application,” Dr Wallace stated.
“The number of customers who abandon the online purchase process is staggeringly high. Organisations have spent millions of dollars trying to improve the online customer experience, but largely the technologies supporting these efforts have neither delivered to the customer nor the business,” stated Dr Catriona Wallace, Founder and CEO of Flamingo.
“This research has brought to life the fact that pricing, complicated processes and website navigation are key obstacles in preventing customers from finalising an online purchase or application,” Dr Wallace stated. “Four in ten businesses state that systems integration problems cause the greatest problems in providing good online experiences for customers.”
The research also showed that both customers and businesses are looking for better connections and experiences online, with 77% of consumers saying immediate online help would increase their likelihood of completing transactions, and 85% of businesses saying that immediate online help would improve online sales conversation rates.
Giving context to the problem, Dr Wallace said the average quote-to-sales conversion rate in the insurance industry is between 20% to 60% for call centres, but this number plummets to just 1%-3% for online.
The research also reports that 81% of businesses believe that a focus on online conversion rates will become more important in the next 12 months.
“The opportunity for business to start adopting innovative tools like ChatBots and Conversational Commerce almost becomes a no brainier, they literally have nothing to lose. For the first time these technologies allow businesses to effectively provide individualised experiences for customers at scale,” said Dr Wallace.
The new research illustrates that improved online functionality and navigation, coupled with improved online customer experience and implementation of chat tools are the three highest-ranking ways organisations are looking to improve online sales conversion.
It’s these factors that have pushed Flamingo to develop one of the world’s first significant Conversational Commerce platforms to provide Intelligence Assistance (IA) to financial services companies.
Rosie, Flamingo’s unique Chatbot has been designed by Flamingo’s Chief Data Scientist, Dr Jack Elliot and CTO, Joe Waller, to tackle the widespread problems of low online conversion rates and poor customer retention in financial services companies.
Unlike Chatbots currently in use who are largely rules based and can only chat with customers, Rosie can both converse and guide customers seeking financial products from quote to payment, without any human interaction with the customer. Flamingo’s experience in implementing this technology, however, is that HAVA (Human Assisted Virtual Assistance) is the best option for successful interactions with customers. HAVA is where Rosie largely guides the customer, however, a human (employee) can take over from the machine if there is a difficult question.
While the first generation of chat technology and other tools have largely failed to deliver results that businesses require, Fifth Quadrant’s research illustrates the appetite for the technology is still very strong with 73% of business saying Chatbots are relevant, 77% of consumers are comfortable using them and 78% stating that a Chatbot would improve their online experience.
Interact with Chatbots
Consumers made comments such as “Chatbots would help me get things done”, “It makes it easier to access instant help”, “Would be a great help and avoids confusion”, and “Anything that helps with the red tape is good”. Consumers who were not comfortable with Chatbots (22%) stated, “I would prefer to speak to a person.” “They are not able to answer all questions”.
Furthermore, the majority of business decision makers believe that Chatbots would improve their key KPIs, particularly around online sales conversion rates (55%), customer satisfaction (55%) and operational efficiency (54%).
Dr Wallace said that the Flamingo Platform not only reduces the overwhelming nature of purchasing complex products online, it’s also intelligent. With each completed transaction, Rosie learns more about how customers and employees interact.
“While other Chatbots focus on just chat, our entire focus has been around online sales conversion from the start. Rosie allows the entire online selling process to be automated, meaning employees are required less often, or not at all.”
The timeliness of Flamingo’s move into the next generation of Chatbots is backed up by Fifth Quadrant’s research, showing that almost 60% of businesses are seriously considering the use of Chatbots within the next five years.
“It’s the right time, and we feel we have the best-in-market product. Analysts are saying 2017 will be the year of Artificial Intelligence and Bot strategy, and 2018 will be the year when significant corporate investment will go in to the implementation of Chatbots, and Conversational Commerce platforms,” Dr Wallace said.
Flamingo is one of only two ASX listed companies where the CEO and Chair are both females. Interestingly, this new research also uncovered that businesses believe Chatbots need to have a female persona that is knowledgeable and problem solving, but also able to provide good customer service by being friendly and polite. Interestingly, consumers prefer a gender neutral Chatbot with helpfulness as the primary trait.
“Our Chatbot, Rosie, is basically like Pepper Potts form the Iron Man movies. She is knowledgeable and responsive, she is able to guide customers through any problem, and she learns as she goes!”
Programme director, Omni Channel at Greater Bank, Matt Henderson, attended the research briefing and said.
"We are very interested in exploring and assessing the value of customer experience initiatives like AI and Chatbots within certain customer segments. With more customers today using online channels than the more traditional offline ones, there is a greater expectation for real time support for their everyday banking needs regardless of the day or time of the week."
Anthony Nantes, CEO of ASX-Listed fintech DirectMoney, also at the event, said;
“As a leading online lender, this research validates what we are experiencing every day with our customers. A seismic shift in consumer expectations is happening globally, affecting every part of the finance industry. The winners over the coming years will be those companies that truly know how to effectively utilise machine learning and can meaningfully adapt artificial intelligence to provide better outcomes for their customers. Chatbots are an effective first step in the direction of a brave new world of online relationships with customers, one that will dramatically alter the finance landscape in the years to come.”
Flamingo, primarily focused on the US market, also announced its Asia Pacific strategy launch.
- Australia-wide study
- Online questionnaires
- Business - cross section of industry verticals with companies that have at least 100 employees
- Consumers - equal spread of gender and age
In the Conversational Commerce field, based in Sydney and NYC, Flamingo is an Enterprise SaaS company, which has developed an Intelligent Guided Selling platform (Artificial Intelligence) designed for selling complex financial products online. The Flamingo Platform aims to turn a website's visitors – those that are looking to purchase financial products - into customers. Flamingo’s Intelligent Assistant or Chatbot is called Rosie. Clients include large financial services firms. Flamingo is one of Gartner’s Cool Vendors. www.flamingo.ai <http://www.flamingo.ai>
ABOUT FIFTH QUADRANT:
Established in 1998, Fifth Quadrant is a Customer Experience Consulting, Research & Design company. The company is comprised of management consultants, customer experience researchers, customer experience designers, industry analysts, data analysts, change managers, thought leadership trainers and futurists. Dr Wallace is a shareholder in the Fifth Quadrant business.
ABOUT SUGAR CRM:
SugarCRM enables businesses to create extraordinary customer relationships with the most empowering, adaptable and affordable customer relationship management (CRM) solution on the market. Based in Silicon Valley, SugarCRM is backed by Goldman Sachs, Draper Fisher Jurvetson, NEA and Walden International. More than 2 million individuals in over 120 countries rely on SugarCRM. To learn more visit http://www.sugarcrm.com or follow @SugarCRM.
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You might also like, the one on one chat Fifth Quadrant had with Catriona Wallace, CEO of Flamingo.io