Thursday, October 12, 2017

Thinking Your Way Through Conversational Commerce

Thomas John, Senior Director and Commerce Practice Lead
Innovation / Technology / Mobile

When the term “Conversational Commerce” was coined in 2015, most companies didn’t really know what to make of it or how to plan for it. A lot of businesses are still caught in between the need to do something vs. lack of clarity of what actually needs to be done. At Rightpoint, we are a group of futurists—who have been thinking and working within this space, and have put together a roadmap to guide you as you think your way through Conversational Commerce.

thomas john conversational commerce

What Exactly is Conversational Commerce?

Conversational Commerce is the act of communicating with a brand or service in a bi-directional manner. This means opening up some additional channels of communication with your customer over a variety of tools, like Facebook Messenger, Slack etc. However, these tools are just the mechanism to give voice to your customers. The logic and the answer to their queries are still based on the content and product offerings you provide.

How Does Conversational Commerce Impact Your Customers?

Conversational Commerce requires you to better understand your customers – their needs, behaviors, and anticipated preferences, as they go through these three phases of a buying journey:

  1. Pre-Purchase – This is commonly known as the Research phase, where the customer is still looking for options before the final buy. This could be anything from pricing to the brand they might be shopping for.
  2. During Purchase – Once the customer has decided on product to purchase, they enter the Purchase or Transactional phase of their journey. A lot of businesses end up losing customers in this phase due to a variety of reasons, such as complex or prolonged checkout processes.
  3. Post-Purchase – Now that you have made a sale, how does the customer journey change? How do you get repeat customers? This is a part of the journey some very successful businesses have mastered by extending the relationship building of their marketing process to continue after a purchase.

Where Does Conversational Commerce Come into Play in the Customer Journey?

The answer is Everywhere.

In the Pre-Purchase phase of the journey, you can utilize Conversational Commerce to help narrow down choices quickly via natural language exchange. The bot helping the customer can be wired with the information in your catalog, supplemented with humans in the background. This ensures that any slang or abbreviations are quickly learned by the system. Instead of typing up a search or scrolling/filtering dozens of results, a user is able to determine what is available on the site. Here is an example of how eBay put in a chatbot to help customers quickly find what they were looking for.

thomas john conversational commerce

In the Purchase phase of their journey, the customer is at a cusp of finishing the buy decision. Lots of cart abandonment issues come back to the complexity or lack of intuitiveness of the checkout process. But some of it, is the lack of a guide for the end user to quickly finish the checkout process. This is where the concept of frictionless payment comes into play. Conversational Commerce could play a role in guiding the user through the process or could play a more direct role in processing payments in specific scenarios. Here is an example of a fashion retailer utilizing Conversational Commerce via Facebook Messenger to enable the buying process.

thomas john conversational commerce

Customers in the Post-Purchase phase of the journey still have expectations from the brand or service they have bought. Some of these expectations are a simple “Thank You” message, order updates (shipped, back-ordered), frictionless return process (generate and print shipping labels without customer service calls), personalized recommendation etc. Conversational Commerce continues even after the customer has finished the purchase process. This cycle generates the repeat customer and Conversational Commerce can play a big role in achieving this goal. Here is an example of a clothing retailer that continues the conversation post-sale and keeps the customer in the loop without having to place a call, including possibilities of repeat buying.

thomas john conversational commerce

To implement a successful Conversational Commerce application, you do not have to take on all phases of the customer journey at the same time. Instead, we recommend you approach it based on the phases a customer goes through. This will achieve two things – you will build a great persona library of your customers, and you can leverage lessons learned within each phase.

Where are the Trends Going?

As the Conversational Commerce trend has been spearheaded by the invasion of the chatbots, there is so much more on the horizon to continue the growth. One key takeaway is the huge growth in the Artificial Intelligence space. In 2016, investors poured in $4.9B into AI startups, and 2017 has seen some of the largest AI Commerce deals, for example – Trax Image Recognition. In addition, we are seeing AI impacting our daily lives and getting integrated into retail/ecommerce companies. Here are some of the exciting trend categories that I see coming soon.

  • Sizing & Styling – To better help with sizing, AI-powered software will help retailers integrate this capability into their sites and application. Amazon has already fired the first shot in this battle for this space with the Echo Look.
  • Predictive Merchandising – With AI in the mix to help with the big data analysis, retailers are betting on building a predictive analysis system that helps them optimize purchasing and allocation across stores and online. If you are better able to predict demand, this will cut down on waste and out of stock conditions.
  • Real-time Product Pricing & Targeting – To reduce the cart abandonment, AI-powered platforms can learn to adjust pricing, promotions, and discounts in real-time, to help increase your conversion rates. In addition, these platforms are also aware of your profile and preferences to help present the right product at the right time. A system such as this would be constantly learning, so even as a customer’s preferences change over time, the targeting will be adjusted accordingly. For example – a customer who is in college will have a different preference 10-15 years apart which impact of career, family etc. included into the profile mix.

Wrapping Up

I know there are so many different choices and decisions to make on the road to Conversational Commerce. The major crossroads should be having a clear understanding of your customer, your platform capabilities and internal process maturity to own the product roadmap for Conversational Commerce.

Rightpoint leverages core capabilities in Digital Strategy, Customer Experience Design, Technical Implementations, Sales and Service, Change Management, and Digital Execution to design and implement solutions that deliver the business outcomes our customers are seeking. Learn more about how our deep understanding of B2B and omni-channel retail commerce enables our teams to drive digital transformation across all your sales and marketing channels.


Thomas John is Senior Director and Commerce practice lead at Rightpoint. Follow Thomas on Twitter and LinkedIn.

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