Are chatbots the future of loyalty?

WM Circle Logo

By: RickFerguson |

Posted on April 26, 2017

The Washington Post highlights the growing number of retailers now relying not on their own smart phone apps to build customer engagement, but rather AI-driven chatbots that exist inside the other apps that consumers use on a daily basis. A Mastercard chatbot initiative powered by Masterpass, the company's digital wallet platorm, and tied to Facebook Messenger may, in fact, provide a sneak preview of the future, in which AI and machine learning allow brands to personalized, relevent, and value-added relationships with their best customers.

By Rick Ferguson

The Post article highlights dining and grocery retailers such as Subway, Cheesecake Factory, and Fresh Direct as early adopters of chatbot-driven engagement. The chatbots are designed to provide a smooth, personalized user experience based on the idea of "conversational commerce" that simulate through digital channels the interactions customers are used to having with knowledgeable, engaged frontline employees.
Will chatbots alone drive incremental behavior and share-of-customer? As the article points out, it's too soon to say. Money quote:
"So just how big a role will chatbots play in the future of shopping? At this point, it's hard to know. For starters, consumers simply haven't had that many opportunities to engage with them yet: According to a survey by Forrester Research, just 4 percent of companies have a chatbot. Plus, the long-term potential of the technology has not been fully realized. "This isn't yet what I would call an efficient medium for the exchange of data," said Julie Ask, a consumer technology analyst at Forrester. "It still has a ways to go before it’s more convenient than the other options that consumers have."
We may also envision a future in which chatbots deliver real-time reward and recognition. Tie them to location-based recognition driven by beacons or NFC, for example, and a chatbot could guide you through in-store purchases that maximize your reward earning, guide you through exclusive in-store experiences, or offer you options for redeeming rewards at the point of sale. Whether chatbots achieve critical mass remains to be seen; the technology does, however, provide another weapon in the arsenal for retailers attempting to leverage data to build strong customer relationships.
Rick Ferguson is CEO and Editor in Chief of the Wise Marketer Group