How third-party chatbots are driving D2C commerce for brands

Mukesh Ambani’s Jiomart has recently floated a “tap and chat" option through which consumers can shop daily essentials such as fruits, vegetables, cereals via WhatsApp and pay either via JioMart or in cash when receiving their order. In India, WhatsApp has about 530 million users-- Meta’s biggest overseas base -- while Jio has more than 425 million subscribers.

From Jiomart and BYJU’s to Ola, scores of Indian brands are now using third-party chatbots to fuel their D2C businesses using Whatsapp, Facebook, Insta Messenger and other social media platforms. The chatbot market in India has been growing exponentially since the past few years but now third-party chatbots, that work on messaging apps like WhatsApp and Instagram, are in demand as most brands wish to reach out to consumers directly.  

The bot can enable everything from payments and tracking shipping to showing recommendations—all the conveniences we’ve got used to on e-commerce sites. “We are seeing huge demand not just from larger enterprise customers in industries like D2C, e-commerce, retail, banking, fintech, etc. but also businesses like restaurants, kirana stores, etc who are embracing technology for the first time for customer engagement,” says Beerud Sheth, CEO and Cofounder, Gupshup.

Gupshup, a Business Solution Provider, has partnered with brands like Oyo, Ola, Khan Academy, Citibank, BYJU’s and Creditwise Capital to develop their chatbots to sell products and services via WhatsApp. These chatbots handle pre-purchase, purchase and post-purchase communications. Gupshup integrates with 30+ messaging channels, including Instagram Messenger. 

Sheth says, “We are seeing a huge demand from brands and agencies helping brands to converse with Instagram followers and sell products and services and support customers on Instagram.”

Juniper Research predicts that consumer retail spends via chatbots worldwide will reach $142 billion by 2024 —up from just $2.8 billion in 2019. Over 80% of businesses are projected to integrate some form of chatbot system or virtual assistants by 2022, a report of Outgrow had suggested. Chatbots can help businesses save as much as 30% of customer support costs. 

Cost-Effective and Quick Solution

How much time and money does it usually take to develop a third-party chatbot? Well, it depends on the complexity of the bot. Most bots take a few days to develop while  at times, it takes a few weeks. Cost also varies from a few thousand to a lakhs of rupees based on the complexity, industry leaders tell e4m. 

IT providers are offering self-serve no-code and low code bot platforms as well that businesses can use to build their own bot. Complexity of bots can range from structured bots to NLP (Natural Language Processing)-powered bots across languages. "The cost-effective platform is luring even small businesses like restaurants, kirana stores for customer engagement", says Sheth. 

Food and groceries are estimated to account for over half of the nation’s retail spending, which is projected to reach as high as $1.3 trillion by 2025, according to Boston Consulting Group.

Big Brands Want Direct Touch With Consumers 

The Covid-19 pandemic has led to a change in consumer behaviour and business models and these are likely to persist even when the crisis is over. One of these is the way we order food, clothes and other goods online. Consumers today are highly demanding and expect quick responses from brands, round-the-clock, on any channel they choose, so they can move on quickly with their lives. 

As a result, big brands are rapidly looking to develop smart chatbots and virtual assistants that don’t only attend to each customer but also understand their emotions, pick up nuances of their languages and dialects and are able to suggest quick solutions, unlike call centres, which often leave customers frustrated due to delayed or no response. 

For instance, global retail chain Spencer and Indian grocery retailer Reliance Jiomart have AI chatbots to sell products directly to consumers on WhatsApp, which is the most preferred mobile messaging App in India. “Use of AI-driven customer care executives will grow immensely in the services sector such as FMCG, Health, Pharma, Wellness, banking and call-centres in the coming years”, says Abhinay Bhasin, Vice President (Asia Pacific), Data & Product Solutions, Data Sciences, dentsu international. 

“With consumers demanding round-the-clock wide range of services ranging from banking and financial services to health and wellness – the need for chatbots has driven a large chunk of revenue towards services to counterbalance consumer demand and be ‘always on’,” Bhasin added. 

Over 80% of routine customer service questions could be answered by a chatbot, says an IBM report. AI-driven chatbots and voice bots can be trained to respond to customer service questions and provide fast solutions 24/7. Hence, many brands are now enhancing their customer service experience and satisfaction, thereby improving their response time, driving new sales, and reducing customer service overhead. As chatbots continue to reduce operating costs for enterprises, their market size will likely swell, say industry experts.

“We live in an era of accelerated digital transformation and focus on delivering seamless customer experiences. This will continue to be fuelled by increased use of intelligent automation along with a human touch, making chatbots widely used as personal agents in the coming year”, says Bhasin. 

Bhasin adds, “Chatbots are now evolving in India to gauge sentiment and conduct a series of tasks with human-like dialogue flow and hence entering the realm of virtual agents with further capability – and a likely area of progress in the years to come as technology continues to adapt and evolve.”

Vernacular chatbots 

With the advancement in NLP (Natural Language Processing), Bhasin foresees a game-changer to be local-language enabled chatbots to provide context based on customer preferences.