Small businesses and startups face a lot of challenges. Cash flow problems, poor management, finding, and retaining customers are some of them. They also have to compete in a market that already has some established players.
To overcome some of the challenges, small businesses must embrace technology. Such help streamline processes and increase efficiency in operations. The result is greater output, higher-quality products, and happy, loyal customers.
Our article will explore how chatbots can aid small businesses. But first, let’s start by understanding what chatbots are.
What are Chatbots?
A chatbot is a computer program that mimics human speech. They are common in live chat features and messaging apps. Small businesses have options in regards to chatbots.
- Rule-based chatbots provide predefined answers to specific questions. They are excellent for leads generation and qualifying. They also improve customer interaction with FAQ platforms. These are rather basic chatbots since they only function within the set programming.
- Intelligent chatbots use machine learning (ML) to learn customer behavior. By understanding specific words or phrases, they can give appropriate responses. Over time they continue to teach themselves to better understand questions. They can then deliver higher-quality answers.
- AI chatbots combine the best features of rule-based chatbots and intelligent chatbots. Such use artificial intelligence, natural language processing, and machine learning. AI chatbots have more advanced features. They can remember context and user preference. They provide a more natural way to handle customers. AI chatbots can mimic human behavior so well, most people will not even realize they are speaking to chatbots.
So how can chatbots help small businesses?
1. Excellent Customer Support
Keeping customers happy can be very difficult for a small business. Many lack the financial capacity to hire full-time staff for customer care. Even if there is someone in charge, the resource may not be enough to take care of the customer demands.
Bigger companies may have the financial capacity to have people work 24/7 on a shift basis. For smaller companies, the financial implications may be too much to handle. It limits customer support to operating hours.
With chatbots, small companies get full-time support. They don’t have to worry about some of the challenges we have highlighted above. Response time is immediate, leading to a higher resolution of queries.
Budget allowing, the company can invest in AI chatbots. They mimic human behavior through learning customer behavior. In this way, the AI chatbots can adjust responses, depending on the situation.
2. Chatbots Can Help with Digital Marketing
Digital marketing allows small businesses to get brand visibility without breaking the bank. The following are ways that chatbots can help with marketing.
- Targeted marketing is essential because the chances of conversions are higher. AI chatbots can make recommendations based on past shopping history.
- Chatbots help with conversational marketing. It is a strategy that depends on conversation or dialogue with customers. The result is better interaction and feedback resulting in a better customer experience.
- Chatbots collect data that the company can use as a basis for decision-making. The company gets to understand what customers want. They can then respond with the right products or services. The result is higher conversions from happy customers.
- Social media provides a fantastic platform for marketing. But, its management can be complex without a full-time resource dedicated to the task. Chatbots provide efficiency by responding to audience comments or queries in real-time.
- The use of chatbots on the company website increases engagement and interaction. The company can improve its rankings on the search engines due to the high traffic on the site. It also provides an opportunity to build organic audiences. Such are more likely to turn into loyal customers.
- Chatbots can take care of tasks like qualifying leads before directing them to an agent.
3. Chatbots Provide Cost Savings to the Business
A small business may struggle with the initial investment in technology. It may indeed be a bit high, making entrepreneurs question whether it is worthwhile. But, the best way to look at it is in the long term.
Take the example of hiring staff to handle customer care. You have to factor in expenses like salaries and medical care. Others are insurance and office infrastructure. These are recurring costs that you have to meet on a monthly or annual basis.
Yet, these are not the only costs when staffing. The company has to factor in expenses associated with hiring, training, onboarding, and so much more. The more people you have to hire to do the work, the higher the business’s operating costs. Calculating the total annual expense will show how much you could save with chatbots.
Every customer a small business loses due to bad customer service is a loss to the company. As stated above, retaining customers is a significant challenge for small businesses. So, such companies must be very careful about how they handle existing ones.
A report by Juniper Research has interesting predictions. By the end of 2022, chatbots will help companies save over $8 billion per year. This is a huge leap from the current global $20 million cost-saving. The financial and banking sectors have been the biggest beneficiary of chatbot services. It helps with customer retention in the competitive business environment.
4. Higher Efficiency in Service Provision
Manual, repetitive tasks can be a burden on human resources. It takes up time that could go into better use elsewhere in the business. By automating responses to repetitive queries, a company can save a lot of time.
That is why some companies use FAQ pages as the first option for customer queries. But, the FAQ page cannot speak to the customer. It can end up being frustrating to use. AI chatbots can handle such queries with ease.
Machine learning allows them to adjust responses to suit the different scenarios. Customers get real-time help without going through tons of text on the FAQ pages.
In situations where the chatbots cannot respond, it passes on the query to an agent. In the end, you have happy customers and employees.
5. Lower Customer Agent Turnover
It is a fact that happy employees will not leave a company. Small businesses struggle to hold on to their available human resources. They are not at the same level as bigger companies that can offer higher salaries.
Customer service can be taxing due to the demands of handling unhappy customers. 33% of companies realize the importance of improving the customer experience. Lower turnover means saving in hiring, onboarding, and training new agents.
The company can use the resources better in other areas of the business. It will also see higher productivity from fulfilled agents.
6. Chatbots Can Help Streamline the Sales Process
Streamlining the sales process is critical for small businesses. Chatbots can provide a lot of functionality that can help with achieving conversions. Such include:
- Lead generation starts from the initial engagement with visitors. It could be on your social media platforms or website. When you interact with audiences, you increase the chances of turning them into leads.
- Lead scoring that relies on critical data. The process entails ranking leads depending on the customer’s readiness, based on interest. You may find marketers using words like hot, warm, or cold to describe leads.
- Product recommendation based on past purchasing behavior. The interaction allows for better personalization, which leads to a better customer experience.
- Streamline the checkout process with chatbots. You can allow customers to buy and make payments via the chatbots window.
- Real-time connection of customers with sales representatives. This is critical because chatbots may not be able to answer or handle more complex queries. The advantage is you can cut down on the number of agents because they only come in when necessary. Human interaction is still a key element in the sales cycle. That is why you can never replace the vital role played by human beings with a machine.
7. Eases the Management of Internal Processes
As an entrepreneur, do you find that some tasks fall by the wayside? You may forget to update your calendar with essential tasks. It can compromise the efficiency of running a business. Chatbots can handle such internal processes for you.
They can help manage your calendars, social media platforms, and documents. The HR can also use chatbots for training or onboarding new employees. It also allows for continuous learning and development.
Chatbots give employees quick access to information. They can provide answers to work-related questions. Staff members do not have to engage with management all the time for such.
Chatbots have a lot to offer small businesses. We have looked at some of the main advantages of investing in such technology. A company can enhance the customer experience leading to better retention. Happy customers are also more likely to convert into loyal, paying ones.
Chatbots can also increase efficiency in the processes. They can help a company cut down on operational costs. Small businesses can improve digital marketing through the use of chatbots. The company can also reduce turnover and increase productivity.
When investing in the technology, look at the long-term benefits. The high initial cost will make sense once you start to see the ROI.