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Chatbots have potential, but still face hurdles – especially for banks

While chatbots may be becoming more mainstream in retail sectors, a new Forrester Research report warns that they still have some hurdles to overcome, especially when it comes to banking.

The report, entitled “Bots Aren’t Ready To Be Bankers,” by Peter Wannemacher, examines popular customer opinion of chatbots, programs that can theoretically respond to customer inquiries through messaging apps in realistic ways. The report finds that customers are most skeptical of using chatbots when it comes to money, and even other sectors that have more success are not without obstacles.

“We’ve already seen some consumer appetite to use bots for high-immediacy yet low-stakes tasks such as ordering relatively cheap food (bots for pizza or taco delivery), checking the weather, casually shopping for fast fashion, etc,” Mr. Wannemacher said.

Banks and bots
Chatbots themselves are not an entirely new concept, though as the report notes, there has been a recent uptick in their employment by brands and businesses.

A large part of this can be attributed to the growing popularity of messaging services. In particular, mobile messaging apps that let users talk to chatbots when they are actually out in the world tend to be the most useful, since that is when customers need answers to questions most.

A large number of banks have begun integrating chatbot services into their digital presence, including Bank of America, which is rolling out a chatbot through Facebook Messenger soon. Facebook, which recently allowed the hosting of branded chatbots on its Messenger app, has become home to a variety of chatbots.

Banks will not be the ideal beneficiary of chatbot services though, according to Forrester. Money is one of the areas where consumers are quite cautious, meaning the sometimes uneven and imprecise experience of dealing with a bot will not be ideal.

Chatbots will improve over time as the technology is more widely iterated on, but banks will not be driving that growth.

Bot in-hand
The rise of mobile messaging apps has had a significant effect on the proliferation of chatbots. In fact, mobile might be the ideal way for customers to engage with chatbots.

“It may not be inherently better, but we do see higher uptake within mobile apps and sites,” Mr. Wannemacher said. “When it comes to what drives better experiences, our research shows that bots are most effective when they (the bots) can set the parameters of the conversation.”

Retale just unveiled a chatbot called RetaleBot that gives users real-time information on deals and promotions near their current location (see story).

But chatbots can also be tools for raising brand awareness rather than just offering information. Compare RetaleBot to Starbucks’ recent pumpkin spice latte bot that let users chat with the personified drink itself for fun (see story).

“I think that use of context – everything the bot or brand knows about the customer at the point of engagement – will drive better bot experiences,” Mr. Wannemacher said. “As for the ‘creepy’ factor (which is a real concern), generally the type of consumer who is willing to experiment with chat bots is also the type of person who is willing to let a company use his or her location to improve services.“