Conversational Commerce: 3 Key Drivers in 2022 & Beyond
Originally coined in 2015 by Chris Messina, conversational commerce has become an increasingly familiar term in the communications and eCommerce markets.
It refers to the intersection of messaging apps and online retail: more specifically, the process by which end users of conversational devices, such as smartphones, are able to leverage them for commerce purposes, including retail and banking, through a chat interface.
Our latest conversational commerce research points to the following being key drivers of conversational commerce over the next five years.
#1: Streamline Services via Omnichannel Communications
In conversational commerce, customers want to engage with brands and complete service interactions using a single chat interface, messaging app, or natural language interface.
This integration of different channels means that vendors are able to offer a versatile approach to its conversational commerce experience. The more channels supported, the more options a customer has to converse with a brand.
Moreover, the use of aggregators will ensure that a platform offers data-rich content that enables customers to switch between channels in a single interaction.
To ensure that conversational commerce vendors are able to maximise the revenue generated through omnichannel communications, vendors must ensure that they provide support for a large number of channels including messaging, voice and video, either through their platform directly or via open APIs.
Furthermore, partnerships with PSPs and other third-party payment providers are imperative to ensure that payment capabilities can be embedded into the chat interface to ensure the completion of purchases can be done through a single channel.
#2: Personalisation of Communication Services
Through the use of AI, eCommerce vendors are able to log customer activity across all communication channels to provide targeted offers and answers based on users’ location and or recent activity.
Leveraging AI provides a ‘memory system’ that is able to store customer information and remember all previous interactions across all channels. Therefore, if a customer contacts a brand on more than one occasion, this memory system will be able to access the customer profile and retrieve information regarding conversation history, recent product purchases and any resolved issues.
However, this increase in personalisation will also enhance risks to data privacy and security, as companies will need access to first-party customer data.
To ensure that this data is only being handled by the relevant parties, commerce vendors must provide encryption services that prevent intelligible data from leaving the cloud. Indeed, end‑to-end encryption is already being offered by some messaging channels including WhatsApp.
#3: Creating Customer Buckets for Upselling Opportunities
The implementation of AI into eCommerce processes will ensure that specific ‘customer buckets’ are created for customer experience. These buckets will automatically be created based on purchasing history, browsing behaviour, and click‑through rate.
This gives brands and customer service agents the tools to provide enhanced customer service, as they can predict why a customer may be making contact, if they have called before and how they prefer communications to be solved.
However, the reach of these services will be influenced by regulations such as GDPR whereby users are able to opt in or out of specific data collection processes. Vendors must ensure that they adhere to regulations such as GDPR to ensure there are no breaches in the collection and storing of customer data.
Moreover, as these customer buckets collect information regarding customers scanning and clicking behaviours, they are able to provide upselling opportunities through recommendations and tailored advertisements to provide a ROI for brands.
Related Reading
Our complimentary whitepaper, Conversational Commerce: The Future of Click-and-Mortar, provides a deep dive analysis into the future potential of the conversational commerce market; identifying current market drivers and constraints, as well as issues recommendations for the smooth integration of payments and value-added services to offer competitive differentiation.
"A new study by Juniper Research has found that the global spend for conversational commerce over OTT channels, including WhatsApp or WeChat, will rise from $13.3 billion in 2022 to $25.1 billion in 2023. This growth of 89% will be driven by verticals such as retail and eCommerce, which provide increased online presence and product availability as retailers refine their online customer experience."
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