Chatbots

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Conversational Messaging

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Conversational Apps: What They Are and Why They Matter

Marc Caballé, Hubtype CEO & Co-Founder

August 20, 2021


Conversational apps are driving the single largest paradigm shift in business today. In this article we explain the definition of conversational apps, why they matter now, and what business leaders can do to prepare.

Contents

1. What are conversational apps?
2. Key UI components of conversational apps
3. What makes conversational apps different from other user interfaces?
4. Key benefits of conversational apps
5. Use Cases and KPIs
6. Tips for building conversational apps
7. How Hubtype helps

What are conversational apps?

Like phone applications, conversational apps are computer programs created to deliver a range of user experiences. However, rather than living as a standalone app on your phone, conversational apps tend to operate within messaging channels like WhatsApp, Messenger, and Telegram. 

Companies use conversational apps to build branded experiences inside of the messaging apps that their customers use every day. These rich, multimedia experiences help customers buy products, return items, get technical support, or do anything else they would normally do on a traditional app or website -- all within a messaging conversation window.

Conversational apps combine the best of all user interfaces (like graphical, text, touch, and voice). Conversations with customers can include attachments, carousels, buttons, and (what’s more important) other embedded elements that enable transactions to be completed without needing to leave the messaging app.

Payments, webviews (mini-websites), multi-factor authentication, and other processes can now happen all within a natural dialogue. As a result, conversational apps are helping brands reimagine entire customer journeys. 

Soon, conversational apps will rival websites as the main interface between businesses and customers

There are three main ideas that make conversational apps unique: 

  • They are multimodal, meaning they combine the best of graphics, text, touch, and voice interfaces to reduce customer effort. 
  • They create structured experiences, which makes interactions faster and more relevant.
  • They leverage the features and benefits of leading messaging platforms like WhatsApp, Facebook Messenger, and Telegram.

We'll review each of these ideas in further detail later. 

Key UI components of conversational apps

Conversational apps use channel-specific features (like buttons), integrate with website tools (like user login), and use small, standalone bits of code called components. These UI components and features come together to create a seamless customer experience. That said, embedded components are not limited to the list below; much like a website, companies can render any graphical element they need. Below are just a few examples of embedded components and features that power conversational apps. 

Buttons

Buttons are a critical element in creating a smooth conversational flow. Like with all UI elements of conversational apps, they are meant to direct users into taking the action you want them to take.

Buttons give users clarity; it's clear what actions they can and cannot take. While they may seem simple, they are one of the most important elements of conversational apps. 

Carousels

A carousel is a set of multiple cards with buttons attached to each card. Carousels allow you to present multiple options to your end-user within a single space. 

Multi-question blocks

Multi-question blocks break forms up into multiple steps. They make forms feel more approachable and prevent users from feeling overwhelmed. 

Rating scales

Rating scales make it quick and easy to collect feedback from customers. They help collect meaningful and actionable insights for each use case.


Web views

A web view is a mini website contained within a conversational application. This lets you offer experiences and features that might be difficult to offer otherwise, like browsing products or selecting seats to book.

 

Date pickers and calendars 

Date pickers are just one example of form components that make it easier for customers to input information. They help people enter a date and time preference for when they want to engage with your business. 

Date pickers reduce the complexities of date validation issues. Invalid dates cannot be entered, you can restrict date ranges, and eliminate date format confusion (for example, ‘6/12/21’ could be June 12, 2021, or December 6, 2021).

Transactional integrations

Transactional integrations turn conversations into conversions. Digital wallets, payment integrations, and other features mean that your customers can buy products without leaving the messaging app. 

What makes conversational apps different from other user interfaces?

1. Conversational apps are multimodal

Part of what makes conversational apps revolutionary is the fact that they are multimodal. They combine text, graphical, touch, and voice interfaces depending on which communication method will require the least amount of effort.

This multimodality separates them from other types of user interfaces that rely on just one mode of communication. For example, when we call a friend on the phone, we rely on verbal communication. We can describe the new shirt we just bought, but we can't show them what it looks like. 

As humans, our conversations become more robust and efficient when we combine different modes of communication. Doing so reduces the amount of effort it takes to convey the information at hand, and ultimately makes conversations less frustrating. 

Although other user interfaces, like voice interfaces, have gotten a lot of attention lately, they have their limitations. For example, when we talk to Alexa, we're limited to verbal communication. We can't browse products, share photos, or swipe through credit cards on file. These limitations mean that smart speakers are not flexible enough for most business use cases. 

The lack of multimodal communication is the same reason why text-based chatbots failed to improve business use cases. Few chatbots offered the rich, humanlike conversation needed to engage users. Even chatbots that employed natural language processing (NLP) and natural language understanding (NLU) failed to deliver great customer experiences. 

In short, conversational apps are uniquely positioned to improve customer experiences. They can be designed to make each interaction seamless, pulling in different conversational elements depending on the use case. 

Text inputs, voice inputs, mouse clicks, menu selections, are all treated as dialogue acts, or parts of the conversation that get a user from point A to point B. The focus is on how each mode of communication works together to form a seamless and dynamic interaction. 

2. Conversational apps are structured

Successful conversational apps are structured. They provide railings to the conversation and create clear expectations and flow for the customer. 

Buttons, carousels, calendars, time selectors, and other visual UI components speed up the time it takes for people to perform an action. This increases the chances of a customer completing a goal. 

In fact, conversational apps reduce the time it takes for a customer to complete a goal by 40% and increase the number of goals completed by 25%. 

This is an advantage of multimodal interfaces, and exactly where other interfaces fall short. NLP/NLU chatbots, for example, must be able to anticipate and handle a wide range of inputs. The user doesn't have any clear guardrails. They can say anything and everything to the chatbot, so they often don't know where to start. 

Even voice bots like Alexa or Google home are now being updated to include a graphical interface. They now have screens to help give more structure to the conversations and make interactions better.

Instead, well-designed conversational apps anticipate questions and guide customers through each interaction. Our clients, for example, already know in advance what the majority of customers will ask. They provide their customers with the information they are looking for before they have to even ask or decide. The result is an amazing customer experience. 

3. Conversational apps leverage the features and benefits of popular messaging applications 

Popular messaging applications (WhatsApp, Messenger, and Telegram) are the perfect home for conversational apps. Designers can capitalize on the features and updates offered by the leading conversational channels.

These messaging companies are constantly releasing new visual UI elements -- and their interfaces get better every day. Within these messaging apps, people can make payments and complete commercial transactions. 

As a result, the commerce loop between consumer and merchant can be completed without leaving the messaging app.

Conversational apps also make it possible to scale these experiences on messaging. You can automate parts of the conversation and manage the chatbot-human handoff. Beyond that, we can integrate with CRMs and even have our own enterprise ticketing system designed for messaging and chat. 

Key benefits of conversational apps

They help brands bridge the communication gap 

According to a recent report by Facebook, over 61% of people say messaging is the easiest, most convenient way to contact a business. When asked why they message businesses, over 64% of people say it's because they’re “always messaging anyway.” 

In addition to a shift in channel preference, customers now expect faster response times. 79% of people expect a brand to respond to them within 4 hours. 

Conversational apps help brands meet these rising expectations. They make it possible for brands to serve customers faster -- on the channels they prefer. 

And when people try messaging, it becomes their go-to medium. For example, 85% of people who had a positive interaction with a brand on WhatsApp would prefer to continue using WhatsApp unless they had an urgent issue. 

These trends make it clear that the way people want to interact with businesses is changing fast. By 2023, we predict that 60% to 80% of all business interactions will take place on messaging.

They reduce friction in the customer journey

80% of consumers say that the experience a business provides is as crucial as the goods or services they sell. Our expectations are rising, and we're becoming intolerant when it comes to poor experiences.

In fact, 1 in 3 customers will leave a brand they love after just one bad experience, while 92% would completely abandon a company after two or three negative interactions. 

Conversational apps reduce friction in business, at every stage of the customer journey. From discovery to post-purchase, conversational apps reduce customer wait time. They also cut down the actions needed to complete a goal.

They make omnichannel experiences possible

In search of truly seamless experiences, leading global players are consolidating their channels through conversational apps. Instead of requiring customers to bounce between their app, website, and other channels, they are aggregating them all through a singular interface. 

This brings brands closer to the definition of omnichannel, serving as a singular point of entry for all of the customers' needs. It simplifies all aspects of a transaction, from discovery to purchase to fulfillment. Shopping becomes vertically effortless. 

And ecommerce isn't the only industry that benefits from conversational apps. The world's leading banks, insurers, airlines, and other organizations are using this technology to realize their omnichannel goals. 


They allow businesses to scale with automation

Conversational apps allow brands to scale experiences on messaging channels. With them, brands are able to use automation to handle close to 80% of their interactions. This makes personalized, one-to-one conversation realistic. 

Conversational apps also help businesses combine automation and humans in a thoughtful way. They can automate specific parts of the customer journey and seamlessly hand the customer over to a human agent when needed. 

When done right, automation frees up your human resources for higher-value work. It helps better manage human resources and spikes in inquiry volume. 

They personalize experiences

Businesses need customer data to personalize experiences. Conversational apps can connect to customer data, integrating with CRMs and information management systems. They can also be linked to analytics software, NLP and NLU technology, and other tools that businesses need to create richer conversations. 

As a result, conversational apps deliver hyper-personalized experiences that even the best customer service representatives would struggle to match. They remember customer details, purchase history, and preferences in an instant. 

They help break down silos between marketing, sales, and customer service teams

As businesses move closer to delivering on the promise of omnichannel experiences, the role of customer service is changing. Customer service isn't just about post-purchase support or helping customers troubleshoot issues.

Instead, customer service is taking on a broader function in moving customers through the purchase funnel. Service is becoming more proactive and less reactive -- and often crosses into the territory of marketing and sales. 

As a result, customer support teams are handling broader interactions through conversation. They're sharing product information, making personalized recommendations, and helping customers complete purchases through natural dialogue. 

And as these conversations become more complex, they require more features and capabilities. Agents need to pull in product information, visuals, and other information for the experience to be effective. 

We see many companies try to migrate graphical use cases from their websites and mobile apps to conversational interfaces (like messaging and chat). However, the customer experience is never good if they rely solely on text. 

Conversational apps have emerged as the answer to these challenges. They help businesses hold more visual conversations, combining the best of messaging apps and modern interfaces. 

Use cases for conversational apps: customer service, marketing, and sales

Conversational apps have both immediate and long-term ROI. In the short term, businesses that adopt conversational strategies improve metrics that are tied to business efficiency. 

For example, conversational apps decrease time to resolution and decrease costs per contact. This has a significant and measurable impact on a company’s bottom line. 

But messaging also impacts profitability indirectly, and these metrics are just as valuable. For example, human-automation handoffs allow for cross-channel solutions, which decreases purchase cycle length. 

Messaging increases customer satisfaction rates, which increases brand loyalty and sales. These metrics are key to building sustainable and longstanding business models. 

Although the boundaries between marketing, customer service, and sales are becoming less clear, it's still helpful to explore how conversational apps improve the metrics that are typically associated with each. 

Customer service

Most brands can automate up to 80% of customer interactions with conversational apps. They automate the routine and common questions that are easy to predict. Then, they rely on a human agent to handle the more complex topics.

The reality is that when it comes to simple questions, customers want fast answers. The immediacy that messaging brings increases customer satisfaction scores and increases lifetime value.

Not only does this make customers happy, but the staff is also happier with less repetition. They're able to focus on more interesting and complex cases.

Key Results:

  • Faster response times
  • Higher NPS scores
  • Increased customer satisfaction 
  • Decreased average handle time
  • Lower time to resolution 

Marketing

With conversational apps, you can proactively engage potential clients with personalized outreach and promotional content. The response rate is more than 50% higher with conversational apps compared to traditional channels. 

When customers respond, you can automatically gather relevant information through simple conversation. When they're ready, you can pass them to the right human agent. 

Key Results:

  • Increased engagement
  • Higher response rates
  • More marketing qualified leads
  • Higher conversion rates

Sales

Conversational apps help businesses automate sales conversations, collect data, and score leads. They can help get customers the right information to move them closer to a goal. They can also pass qualified leads to representatives to close the sale. 

This creates a well-oiled sales pipeline that shortens sales cycles, improves conversions, and reduces tedious work. 

Key Results:

  • More sales qualified leads
  • Shorter sales cycles
  • Improved efficiency 
  • Higher conversion rates
  • Improves overall efficiency

Tips for building conversational apps 

Create well-structured conversations 

The structure is one of the key benefits of conversational apps. With a well-defined structure, you can manage expectations and direct the conversation. The key is to make sure the structure is aligned with your business goals. 

You wouldn't build a website so that people could interact with you in ways that are not related to sales, customer service, or other parts of your business. The same goes for conversational apps; it's important to design conversational flows that move customers closer to your shared objectives. 

Anticipate your customers' needs

Good conversational apps anticipate customers’ needs. Chances are, you know what a customer will ask before they do. In reality, 80% of your customer support tickets likely come from 20% of your FAQs. 

The key is to design a conversational app that gets people what they want as fast as possible. So, don’t let them even have to decide what to do next. Instead, provide them with what the majority of people are looking for and hand the rest over to a human agent. 

Carefully consider what type of automation is right for you 

In 2016, the hype (and disappointment) surrounding AI, NLP, and NLU showed us that this technology alone is not enough to deliver great customer experiences through chat and messaging channels. Businesses created chatbots that were supposed to do everything -- and in the end, they ended up doing nothing. 

Instead of hitting the ground running with AI, it's best to start with the minimum viable automation (MVA). This is just enough automation to make things easier, not more complicated.

Use your MVA to gather information on how your customers want to use your channel. Learn from the limitations of your customer experience, and scale based on where you're seeing the most opportunity.

How Hubtype helps

Our vision

The future of commerce is conversational. Hubtype helps businesses meet their customers' current needs on messaging, and provides the framework necessary to meet their needs ten years from now. 

We help brands improve customer experiences across all departments. Marketing, sales, and customer service teams around the world benefit from the experiences we help build on messaging and chat.

We're committed to helping our clients improve key success metrics across a diverse range of use cases. Our tools help unlock a new level of efficiency while improving customer satisfaction. 

Our platform 

Our open source framework, built on React.js, allows robust integrations. This includes CRMs, APIs, analytics, AI, and other business tools. These integrations help businesses orchestrate the customer journey in a whole new way. They can connect their customer data, tech stack, and third-party tools to engage customers in real time. 

For example, Hubtype makes it easy to seamlessly transition customers from a bot to a human agent and back again. Our collaboration tools, workflows, and integrations finally make omnichannel goals realistic. 

Our clients

National and multinational brands trust Hubtype's framework to build conversational apps. Michael Kors, Zurich, Bankia, Allianz, Volkswagen, Guess, Decathlon all rely on us to realize their conversational strategies. 

Our tools improve the lifetime value of their customers, all while reducing operational costs.




Are you ready to create conversational apps for your enterprise business? Contact Hubtype today to talk about your conversational app strategy.

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