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Chatbots

16 Essential Benefits of Chatbots [+ Challenges in 2022]

by Beata Stefanowicz·Updated
Benefits of chatbots cover image

Chatbots became very popular lately. But what’s this whole buzz all about?

How can YOUR business profit from implementing bots on your website and other platforms? And is it even worth it?

Let’s dive in and discover what are the benefits of a chatbot, the challenges of chatbot implementation, and how to make the most out of your bots.

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First thing’s first—

What are the different types of chatbots?

Well—

There are three types of chatbots: rule-based, AI bots, and hybrid.

So, how do they differ?

Rule-based chatbots are the ones that give the user a choice of options to click on to get an answer to a specific query. These bots only offer a limited selection of questions, but you can use them to answer your customers’ most FAQs. 

Chatbots that use artificial intelligence, natural language processing (NLP), and machine learning understand a variety of keywords and phrases and learn from the visitor’s input. These bots get trained over time to understand more queries and different ways that customers phrase a question.

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Hybrid chatbots combine rule-based bots and AI technology. They perform some rule-based tasks, but they can also detect the context and user intent. They are the best-balanced tool for a business to interact with website visitors. 

Okay, so these were the types of bots you can encounter on the internet. But what are the advantages of chatbots for your company and for the clients? Let’s find out!

Here’s a list of the 16 key benefits of chatbots for businesses and customers:

  1. More generated leads
  2. Increased sales
  3. Saved costs
  4. Improved customer engagement
  5. Better marketing
  6. Decreased bounce rate
  7. Better customer insights
  8. Recruitment support available
  9. 24/7 availability
  10. Better user experience
  11. Multilingual support
  12. Better personalization
  13. Easier checkout
  14. Proactive customer service
  15. Faster response time
  16. Multichannel support

Let’s learn about each of them more in-depth.

Chatbot benefits for business

From financial benefits of chatbots to improving the customer satisfaction of your clients. So, why are chatbots essential for business? Here’s an infographic showing off the benefits.

1. Generate leads

Before the chat really begins, your chatbots can already start collecting leads for your marketing team. The bot does this by asking the visitor for their information in order to start the chat. 

Another advantage of a chatbot is that it can qualify your leads before sending them to your sales agents or the service team. A bot can ask questions related to the customer journey and identify which leads fit which of your offerings. 

For example, let’s say you have a gift box business with different packages for a variety of occasions. The bot can ask “what’s the occasion?” to qualify the lead. This will save your agents time because they’ll know who they’re speaking with and what stage of the sales funnel they’re at.

2. Increase sales

Chatbots can bring more sales for your business. Bots turn the first-time website visitors into new customers by showing off your new products and offering discounts to tempt potential clients.

Bots also proactively send notifications to website visitors and help to speed up the purchase decision process. These notifications can include your ongoing offers or news about the company. Chatbots can also help clients to find what they are looking for. 

One of the use cases for this benefit is using a retail chatbot to offer personalized product recommendations and help to place an order. Chatbots can also push your visitor further down the sales funnel and offer assistance with delivery tracking and other support.

3. Save costs

Cost saving is another essential benefit of a chatbot. It can automate day-to-day tasks that include everything from answering FAQs to booking appointments. This allows your customer support team to concentrate on more complex queries. 

Implementing a chatbot is much cheaper than hiring employees for each task or creating a cross-platform solution to deal with repetitive tasks. You can even cut down on the staff that your business needs to function—You’ll still need a few agents to overlook the activities and jump in whenever needed, but the bots can speed up the process.

As an example, let’s say your company spends $2,000 per month for each customer support representative. If you get your bot from a vendor, you’ll pay around $40 per month for the unlimited number of chatbots. This will add up to thousands in saved revenue by the end of the year. 

4. Improves customer engagement

You can use chatbots as virtual assistants for your clients. Bots can improve customer engagement by making the experience more interactive. Instead of browsing around your ecommerce, your clients can engage with the chatbot and get personalized support.

Bots provide information in smaller chunks and based on the user’s input. This makes the interaction more personalized and specific. In turn, clients are more likely to stay engaged and will be better informed than if they were to read a boring knowledge base article.

Research shows that customers spend from 20% to 40% more with companies who engage them on social media. This shows that it’s important and profitable to ensure real-time engagement for your visitors. 

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5. Provides conversational marketing

Another chatbot benefit for your business is that you can use them as part of your marketing strategy. Marketing chatbots can recommend products, take orders, and push clients down the sales funnel using conversational AI.

You can even use the data collected by bots in your email marketing campaigns and personalize future customer interactions. They can also fill in the gap between the customer showing interest in your products and the sales representative joining the conversation.

Imagine a potential customer browsing your website but doesn’t checkout. A chatbot can pop up after a specific time and suggest using an interactive spinning wheel with discounts and other offers for the visitor. It’s fun and interactive for the user. They spin the wheel and get a discount code for your latest collection. They probably think to themselves “it would be a shame to waste it”, so they go ahead with a purchase. BAM! You just got yourself a sale.

Example of interactive spinning wheel with discounts and offers in Tidio widget

6. Decrease bounce rate

Your website’s bounce rate largely depends on how absorbed the users are in browsing your content. It is the percentage of visitors who stop browsing your site after opening the first page. 

A benefit of a chatbot is that bots can entertain and engage your audience while helping them out. This engagement can keep people on your website for longer, improve SEO, and improve the customer care you provide to the users.

If your bounce rate is high, it shows that potential customers don’t find what they were looking for and leave it to your competitors. A chatbot can help with that by popping up when a visitor is about to leave. They can then offer help in finding what the user is looking for or give them a discount code. 

7. Gain customer insights

Another chatbot advantage is that it can collect customer data, such as name, email address, and other information. You can also embed a customer satisfaction survey at the end of the bot’s conversation to see how happy your customers are with your brand.

What’s more, is that chatbots can collect customer feedback that is aimed at improving your products and services according to the customer’s needs. You can do this by going through the chats and looking for common themes. 

Chatbot asking for email address in exchange for a discount code for new customers

For example, if a specific landing page is underperforming, your chatbot can reach out to visitors with a survey. This way, you know why your potential customers are leaving and can even provide special offers to increase conversions.

8. Help with recruitment

Even your HR department can make use of chatbots. You can use them to automate some of the recruiting processes. These include answering candidates’ questions and keeping them informed.

For example, let’s say you’re hiring for a position of a customer service representative. Chatbots can answer most of the candidates’ questions related to the recruitment process and your expectations. This way, your HR department can focus on the other tasks related to recruitment.

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9. Lower the number of requests for the human agents

Over 87% of customers report that chatbots are effective in resolving their issues. This is one of the advantages of chatbots in customer service—They can significantly reduce the requests going to your human representatives.

Bots taking over some of the customer inquiries can have a positive impact on customer satisfaction as well as your representatives’ well-being. The agents won’t be stressed out trying to answer queries as quickly as possible, but will rather have time to focus on each request in-depth. In turn, you will take better care of the clients and improve their opinion of your brand.

Now— 

Let’s move on to find out what some of the benefits chatbots have for your customers. 

Benefits of chatbots for customers

Your business benefiting from the bots is not enough to keep up the great results of chatbots. Your clients need to be happy as well!

This is how chatbots can help you achieve this.

1. Available for customers 24/7

Chatbots are available to answer customer questions at any hour, day or night. Now, the customer can ask a query to the chatbot and get an instant reply or get sent to the page with the right product. 

Imagine your customer browsing your website for some late-night shopping. But they can’t find the right model of the product you’re selling. It’s late at night, so they can’t get a hold of your support team. That’s when the bot pops up and offers support. The customer eventually finds what they wanted and places an order, happy with the assistance. Sounds like a great customer service scenario, right?

2. Multilingual support

Bots are available in many languages, which is another one of the benefits of chatbots for a customer. So, no matter which language your customer is most comfortable with, they can get proper support. 

You can program the bots into as many languages as the vendor offers. Let’s say you have an international customer base. You can meet customer expectations from many regions of the world by helping them out in their native language. This helps the client to explain their issues clearer and get useful support. 

Read more:
Learn how to create a Tidio chatbot in multiple languages

3. Better personalization

Personalization is important for customers. In fact, about 44% of buyers become repeat customers after receiving a personalized experience. It pays off to customize your messages to clients and provide more personalized customer service. 

One of the chatbots’ advantages is that they can add a personal touch to communication. They chat with clients naturally and offer an interactive one-on-one experience. They can also provide personalized product and service recommendations based on the visitor’s responses. 

4. Easy checkout

Chatbots can take orders straight from the chat or send the client directly to the checkout page to complete the purchase. This will minimize the effort a potential customer has to go through during a checkout. In turn, this reduces friction points before the sale and improves the user experience.

For example, a client using a chatbot to order a pizza can choose which one they want, the size, any add-ons, and then get sent straight to the checkout page with their order ready to be paid for. Quick and easy, just like that. 

5. Proactive customer service 

Most companies use passive customer communication. That means they only respond to clients but never initiate the interaction. And about 68% of shoppers have a more favorable view of brands that offer proactive customer service. You can use this to your advantage with the help of chatbots. 

Why bots? They can engage an unlimited number of people at once, so it’s not a problem that

you don’t have enough manpower to initiate communication with all of your website visitors. 

6. Faster response time

About 96% of shoppers expect a response within five minutes. And chatbots provide instant responses to help customers with simple questions right there and then. This helps to decrease the waiting time for your customer support down to a couple of seconds. 

This is not possible when your representatives have hundreds of requests piled up from clients. But the pile can loosen up if the bots take over the simple or common requests, leaving only the most complex ones for your human agents to deal with.

7. Delivers omnichannel support

You can be exactly where your clients need you. Keep in mind that about 74% of clients use multiple channels to start and complete a transaction. So, try to implement your bot into different platforms where your customers can be looking for you and your help.

A benefit of chatbots is that you can be present on messaging platforms and social media. A lot of people prefer to use messaging platforms like WhatsApp or Telegram for customer service questions. It proves more convenient and faster than waiting for an email.

Moving forward, what are some of the challenges you should keep in mind when it comes to chatbots?

Chatbot challenges and how to fix them

Even though it might seem like it, chatbots are not all rainbows and unicorns. There are some downsides to them. And you should be aware of those when thinking about implementing bots into your business.

The three common disadvantages of chatbots are:

  1. Setup and maintenance
  2. Emotionless support
  3. Limited functionality

Let’s look at them in more detail. 

Setup and maintenance

Before you start enjoying any of the benefits, you need to spend some time setting the chatbots up. They can be tricky to install and set up, especially if the bot is complex. In total, you will probably need about 2 weeks to set up and get to know all the functionalities of your chatbot.

Chatbots also need frequent optimization and maintenance to work properly. Whenever you’re changing anything at your company, you need to reflect that change in your bot’s answers to clients. You should also frequently look through the chats to see what improvements you should implement to your bot.

Solution:

Find a chatbot platform that will be easy and quick to set up. Also, assign one of your employees to maintain and improve the chatbot.

No emotions

A chatbot is not a human. It doesn’t have emotions, no matter how much you might want to make a connection with it. The bot can’t recognize if the customer is happy, sad, or angry. And the chatbot could come across as emotionally insensitive.

Let’s say a user is frustrated with the issue they’re having. They want empathy, but instead, get cold responses that follow a specific path. The bot can’t improvise or match emotions and therefore, lacks a human touch. This could lead to negative experiences and your brand could lose on customer satisfaction.

Solution:

Find a great chatbot name that will give more personality to your bot. Also, use AI chatbots for a more natural flow of conversations. And remember that it’s important to always have your human representative available to jump into the conversation when needed.

Limited functionality

The main chatbot disadvantage is that the bots can only perform certain set functionalities and cannot do anything that is outside their setup. After all, there is no replacing of the natural flow of a human conversation. So, keep in mind that chatbots are a supplement to your human agents, not a replacement. 

Different providers offer a variety of functionalities with the chatbot. Most of them won’t probably have everything your business requires. This can lead to you having to implement a number of other third-party services to your website to get the result you want.

Solution:

Pick the best chatbot solution for your business. Look at the features provided by the platform and see which vendor has the features important for your company.

Chatbot pros and cons

So, you’ve seen all the advantages and disadvantages of chatbots in depth. But it’s useful to have a clear look at them in one place. 

So, let’s bring them all together and review the pros and cons of chatbots in a comparison table.

Pros 👍Cons 👎
– More leads
– Increased sales
– Saved costs
– Improved customer engagement
– Better marketing
– Decreased bounce rate
– Customer insights
– Recruitment support available 24/7 availability
– Better user experience
– Multilingual support
– Better personalization
– Easier checkout
– Proactive customer service
– Faster response time
– Omnichannel presence available
– Time-consuming setup and maintenance
– Emotionless service
– Limited functionality

How to get the most out of your chatbot?

Knowing the chatbot benefits and benefiting from chatbots are a little different. For best results from your bots, you should remember to:

Start by listing the problems you want the chatbot to solve

Let’s take a step back. Before you implement your first chatbot, you should make a list of your company’s issues that you want the bot to solve. Organize them by topic and write down everything you’re struggling with. 

A woman writing "Problems to sol.." on a whiteboard

This will provide you with an idea of which chatbots you should implement and how to measure their results. It will also help you determine which of the problems are the most pressing and therefore should be first when you’re making your bots.

Choose the right provider

When you know what you need from the chatbot, then it’s time to choose the tool that will help you solve the problems.

To choose the right chatbot builder for your business, you should look into the features and functionalities each vendor provides. The best way to see the best options is to look at the articles that compare them and then sign up for the free trial to take the platform for a test drive.

Read more

Choose where to put the bot

Do you want to put your chatbot on your website or Facebook page? Or maybe you want to have an omnichannel presence of your bots?

Screenshots of the same bot on different platforms: website, Messenger, and WhatsApp

You should decide which channels you want to implement your chatbot onto. You can implement Facebook Messenger bots onto your social media page, so your clients can easily find the chat. You can also choose a solution that lets you implement a chatbot on many platforms, such as your social media, WhatsApp, and your website.

Give the chatbot a personality

This is a big step, and probably the most important one. You should set the tone of voice, write the chatbot script, put the right chat icon, and set a welcome message to greet your site visitors. 

Welcome message from a bot in Tidio widget

First of all, decide whether your bot should use formal or informal language and set the tone that matches your brand. Then, create a wireframe of the chatbot story that includes engaging characteristics. After that, find a unique chatbot icon that will fit your brand and ensure it’s clearly showing that this is a bot. Last but not least, create a great first impression by greeting your clients with a warm welcome message.

Read more:

Set up KPIs

Now it’s time to decide how you will measure the chatbot’s success by setting up metrics. You can use the number of collected leads, the retention rate of customers, or the number of independently solved customer queries. 

Illustration of a bot with 4.5 star rating

This step ties in with listing your needs—a customer service chatbot should be rated by a different metric compared to a lead generation bot. For example, if you implement the chatbot to increase sales, your metrics should relate to sales, such as conversion rate.

Key takeaway 

Chatbots have many benefits that your business can profit from. Some of the most notable chatbot advantages are:

  • Improving customer experience
  • Providing value in marketing
  • Generating leads
  • Increasing sales
  • Saving time

You should remember that bots also have some challenges that you will need to overcome. These include timely setup and maintenance, as well as, lack of emotions in the conversation. 

Remember to carefully choose your chatbot provider and make sure they offer all the functionalities necessary to your business. Then, get the most out of your bot by putting it on the right page of your website and giving it personality. 

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Beata Stefanowicz
Beata Stefanowicz

Content Writer at Tidio with a love for the written word. She scouts around for digital trends and ways to help small and medium businesses grow.

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