Chatbot Tracker: Is 2017 The Chatbot Year?

(Article originally published by PYMNTS.com)

Tens of thousands of chatbots were born in 2016. They pose as cocktail coaches and help ship gifts. There are airline travel chatbots that will book flight, hungry and hospitable chatbots that will even order you a pizza, chatbots that will memorialize dead relatives, vote-garnering political chatbots and, of course, banking chatbots.

“It is a one-to-one conversation providing research (product recommendations, prices, promotions, availability, etc.) and post-purchase customer service (delivery, exchange/return, usage, etc.),” said Craig Besnoy, digital transformation specialist at Mindtree. “Because the customer opts in, enabling the retailer to access a plethora of rich and explicit purchase-intent data, the bot or the sales associate can provide valuable advice and recommendations and build a personalized and meaningful relationship with the customer.”

But specifically looking at retail chatbots, what will they look like in 2017?

“2017 will be the year of the bot,” said David Horton, managing director, innovation at Synechron. “The technology is here and now, and the implementation of the technology does not require a significant overhaul of existing systems and has become mainstream.”

Horton said that the reason the time is now is because customer experience is at the center of most businesses, which are looking to strengthen their digital capabilities to remain competitive and differentiate themselves in a saturated market.

“Retail brands will use chatbots to communicate directly with customers, both by sending intelligent messages around specific products they know their customers are interested in and by offering exclusive promotions/events in stores that are relevant to the user’s location,” said Jonathan Shriftman, director of business development at Snaps. “Retail brands will also use bots to drive awareness of new product announcements and drive tune-in around their fashion shows.”

Brands will increasingly adapt chatbot technology to aid with customer support, he added.

And yet other experts focus on the analytics and data in the chatbot of the future. As a result, the chatbot can evolve into a further perfected version of itself to benefit both the customer and the business.

“Chatbots enable retailers to gather more detailed analytics than a traditional eCommerce transaction,” said Besnoy. “With chatbots, each element of the customer interaction can be tracked and adjusted in order to optimize the transaction flow. These leanings can then be brought back to traditional ecommerce environments to optimize a retailer’s entire commerce strategy.”

Beyond analytics, chatbots will influence retail in four other ways: multiple engagements from a single conversation, lead generation and qualification, streamlining interactions with consumers, and making secure transactions, he added.

“Today, PCI-compliant chatbot transactions happen when the automated conversation allows the user to log on through a separate, secure web connection,” said Besnoy. “Upon completing the login process, an authentication token specific to that user, and that conversation is created and is passed to the platform hosting the conversation. The token associates the conversation [with] a saved payment method on file … [which] is used to process the transaction. No PII information is passed through the messaging platform.”

Others think that 2017 will see a surge in first-generation chatbots springing up more than ever.

“These chatbots will be limited in their capabilities and will mostly be seen as prototypes or tests, as developers and business owners try to get their heads and hands wrapped around the concepts both in terms of technology and the use cases making the most sense for bots to solve,” said Claus Jepsen, chief architect at Unit4.

As a result, he said chatbots will have enormous influence on retail in 2017, mostly because brand owners will be reluctant to run too much risk deploying immature chatbots. The following year is where Jepsen thinks the impact will truly be found.

“In 2018 most online web shops will have chatbots engaging with shoppers. Not that the chatbots will provide additional information already available, but it will add a more personal feel to the experience,” he said.

So maybe not everyone is on board with 2017 being the year that chatbots will truly make their mark. But 2018 may not be the year either. Some even go so far to say the year of the chatbot already happened.

“I think 2016 was the year of the chatbot. Sure, more companies will use them in 2020, but 2016 was the year they became more than an idea,” said Alex Campbell, cofounder and CIO at Vibes. “By 2020 chatbots will be commonplace.”

Speaking of the year 2020, more than 80 percent of businesses have reported already incorporating or planning on adding chatbots by then. That’s according to a study pulled together by Oracle surveying more than 800 decision makers at companies in France, the Netherlands, South Africa and the U.K. Most were in the C-suite — chief strategy officers and marketing officers; others were senior sales and marketing executives.

“Chatbots will undoubtedly be a staple technology by 2020, but the transition will happen sooner than that,” said Bart Mroz, cofounder and CEO of SUMO Heavy. “In terms of a year of the chatbot in which the technology goes mainstream and is adopted en masse like native apps were near the beginning of this decade, I think that’s right around the corner. The foundation is in place.”

Mroz said companies and developers will hustle to innovate in the chatbot sphere and target consumers through this platform where they’re already congregated.

Either way, 2017 may be the year that the biggest changes will happen order to make those chatbots have a real chance at becoming mainstream. Because while they’re not perfect, neither are the people who make them.

“Even with rapid development, chatbots are, at best, still imperfect,” said Mitchell Reichgut, CEO of Jun Group. “We’ve seen a lot of chatbot failures, which have alienated some customers from certain brands But despite the many bot failures, chatbots could still dominate the future of messaging apps. Their future depends on the development of artificial intelligence and machine learning.”

And that future comes from learnings of previous years.

“To me, getting any idea beyond talk and into development is always the most significant accomplishment,” said Campbell. “I truly believe in 2020 we will look back at 2016 and declare that the year of the chatbot.”