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Marketing chatbots: Automated customer relationship management

Companies are increasingly deploying chatbots to generate sales leads and guide potential clients.

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Quantumrun Foresight
October 13, 2023

Insight summary

Chatbots are expanding their roles from customer support to marketing due to advancements in natural language processing. As the chatbot market is predicted to reach $1.3 billion by 2024, companies are increasingly adopting them to engage customers and generate leads. These bots can manage interactions and qualify leads around the clock, reducing the need for additional human staff. Businesses are moving away from disguising bots as humans, as customers prefer accurate and quick responses over the appearance of human interaction. The technology is expected to advance, allowing for more sophisticated customer engagement and automating even more tasks.

Marketing chatbots context

Chatbots are a form of artificial intelligence (AI) technology that facilitates communication between a brand and its customers. This software is designed to imitate human conversation to make customer support more efficient. In chatbots, machine learning (ML) algorithms are used to make decision-making easier. The more they talk with humans, the better they get at conversation. Intelligence firm Global Market Insights predicts that the chatbot market will reach over $1.3 billion USD by 2024. Additionally, AI will become the primary focus of customer experience investments. About 40 percent of organizations will invest in digital initiatives, and 47 percent will prefer to deploy chatbots for customer care.

According to chatbot developer Intercom, website customers are 82 percent more likely to convert if they are engaged through chat. This is where marketing chatbots can help by turning casual browsers into leads for sales. Marketing chatbots use software to manage interactions with potential and current customers on a website or an app to create sales opportunities. By using chatbots in marketing strategies, businesses can connect with leads 24/7 without additional headcount. Similar to how these chatbots can assist in customer support queries, they can also be used with website visitors to conduct qualification processes and even upsell products and services.

Disruptive impact

One of the examples of how chatbot marketing is being leveraged is the German car dealership Volvo Cars Amberg. Automobile buyers frequently visit dealership websites to research prices, so the company placed a marketing chatbot with an integrated Typeform survey on their site. The result is an instant price quote customized based on the client's color and model preferences. According to the company's marketing manager, they were able to increase lead generation by 30 percent because of this tool. In addition, leads that come through their chatbot are 200 percent more likely to purchase a vehicle than those who fill out a contact form. This is because chatbots allow potential customers to get immediate answers to their questions or even book a test drive online.

According to Intercom, the first step in establishing a marketing chatbot is to stop passing them off as human agents. Most companies use stock photos and generic names to humanize chatbots. However, customers are already aware that they are talking to chatbots; they are not looking to speak to human agents as long as their questions are adequately and sensibly addressed. As chatbot technology continues to develop, companies will soon be able to have marketing chatbots that can accurately respond to inquiries, book appointments, fill out forms, and send leads to the correct emails. This feature will help companies save costs as they won't need to hire human agents to cover different time zones.

Implications of marketing chatbots

Wider implications of marketing chatbots may include:

Companies replacing human agents with marketing chatbots; however, agents will still be needed for more technically complex queries.
More sophisticated chatbots that can pull up different products/services for comparison and help guide customers through their decision-making.
Websites that allow customers to conduct the purchasing process entirely via chatbots, from queries to checkout to payments.
More startups focusing on chatbot development for customer relationship management.
All websites employing chatbots by default to encourage repeat engagement.