The Chatbot Dilemma

Chatbots are increasingly used by businesses to reduce expenses, deliver quick responses, generate leads, increase productivity and gather consumer insights. However, they can be saddled with a host of issues that might unnerve consumers such as impersonalization and mechanical limitations.

Here is a quick look at the most common dilemmas that businesses face when implementing chatbots:

Dilemma #1: Speed Versus Personalization

We (as consumers) want quick answers. When potential consumers approach a brand and their issues are resolved immediately, they are more likely to take action. Thus, brands are employing chatbots to respond to their users quickly. Bots work round-the-clock and as many as 64% of internet users see this support as their biggest benefit.

A majority of surveyed consumers (61%) feel that it takes too long for an enquiry with a brand to be resolved. When a brand uses manual agents, they are likely to get overwhelmed by the volume of enquiries, and are unable to respond to all of them quickly. Chatbots sidestep this problem by providing answers instantly.

However, we also want the brands we trust to engage with us personally. People prefer interacting with humans than with bots. Nearly two thirds (64%) of consumer respondents believe that they get the best results when contacting a brand if they interact with a human customer service agent only. Bots are too impersonal and may lead to a reputation hit if consumers feel like the brand does not care enough to have a human respond to them.

Dilemma #2: Cost Effectiveness Versus Mechanical Limitations

As more people reach out to brands online, it is more costly for brands to respond to their consumers. Hiring more employees to respond to consumers is an unsustainable model in the long term for any growing business. Chatbots cut down this cost dramatically - up-to 30% - all the while increasing leads. The return on investment of a chatbot is an upward sloping graph as bots get smarter over time without requiring a pay raise.

However, bots are not humans. They work best when a conversation with the user follows a path and flows in a way that the bot has been trained to respond to. Any unexpected responses or variations in conversation can lower a bot’s performance, and lead to user non-compliance.

Dilemma #3: Consumer Experience: Improved or not?

82% of consumers have stopped doing business with a company following a bad customer experience. After all, we live in a world of abundant choice and cut-throat competition.

It is difficult to determine how people will react to a chatbot versus a manual agent, given their tradeoffs. Over 70% of consumers agree that brands should leverage technologies to reduce the amount of time that it takes to resolve a customer enquiry or issue. However, a majority of them also continue to prefer an interaction with a human agent.

While most bots are really good at addressing basic questions, they are ill suited to resolve complex problems. Consumers may be very happy if they get an answer, or exasperated that the bot is unable to understand their concern.

So, the million dollar question remains,

How do you resolve these dilemmas?

The answer lies somewhere in between bots and humans.

Conversational software agents, such as chatbots, have been designed to mimic human interactions. It is widely accepted that chatbots need to be developed with anthropomorphic design cues with the goal of creating a social human-like presence. However, the bot cannot be limited to static responses to a user. It must be equipped with technology that enables more empathetic and flexible responses.

Human interactions are fundamentally social. Our evolutionary biased orientation has given rise to the social response theory, which purports that humans unconsciously perceive the technology that they interact with as social actors even when they know that technology is devoid of feelings and emotions. This means that chatbots are subject to the same social norms as humans. When interacting with a chatbot, users expect politeness and are vulnerable to flattery, just as they would be when interacting with a human.

  • Brands need to maintain a balance: using chatbots while integrating human agents into the fold when the bots hit a wall. A symbiotic relationship needs to be developed between an agent and a bot from the very beginning. Bots need to be designed such that they are able to transfer consumers to an agent before the consumer gets frustrated. This can also improve the agent’s work by collating real-time information about the consumer that they have already provided to the bot.

  • Ease the consumer into the technology. Brands cannot expect their users to adapt to technology quicker - a consumer’s own pace is their own prerogative. It is the onus of the company to make sure the technology is suited to meet the needs of their consumers.

  • Remain cognizant of your own business needs. Scale and practicality remain the most important factors in solving these dilemmas. While in an ideal world, you may want to deliver every single customer of yours a response tailored to their personal preferences, it is imperative not to lose sight of reality. As your business grows, chatbots will be integral to meet the rising expectations of your customers who are seeking immediate answers. Chatbots will also be the most cost-effective.

To meet the needs of your consumers, it is essential to use the smartest technology available. For this, Locobuzz is working tirelessly to design chatbots that are best suited to give your consumers a human experience. Through a dedicated team and leading AI technology, they strive to ensure that your chatbot dilemmas become a thing of the past.


Insiya Raja
Team Locobuzz


Locobuzz is a SaaS platform that converges with technologies such as Artificial Intelligence, Machine Learning, Big Data and Analytics to provide brands with a 360-degree customer experience management suite. Locobuzz’s powerful analytics algorithms have helped seasoned brands establish a strong foothold in the digital hemisphere and transformed their customer experience journeys. Visit our website www.locobuzz.com for more information on our Customer Experience management services that are catered toward businesses like yours!


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