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Why Chat Kills Social Media in Customer Relationships & E-commerce

Traditional Social Media Implodes


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Godfrey Parkin

3 years ago | 11 min read

Traditional Social Media Implodes

For marketers, social media was traditionally a free platform where you earned your audience through publishing relevant and meaningful content, and by occasionally talking to a customer.

Most brands built up a fan-base of likers, then broadcast an endless pipeline of promotional messaging to an audience who over time simply stopped receiving their posts. Today’s reality for marketers is that this organic social performance has evaporated.

In South Africa, for example, data from the 2018 Social Media Landscape Report by World Wide Worx & Ornico shows how little real impact the major social platforms have, even for big-budget brands who invest in boosting or promoting their posts.

Among top South African brands last year, Facebook users achieved an average of only 22 shares per post. On Twitter, where the top brands averaged over 70,000 followers, they achieved only 11 re-tweets per tweet on average. If engagement is the objective, it’s clear that it is not being achieved on a commercially viable scale. Relative to the time, talent and budget being applied, organic social marketing has become pointless.

The business model of social platforms such as Facebook is to sell audiences to advertisers. If you do not use them as a paid targetable broadcast medium, you are wasting your time. The “earned media” party is over, and the future of content marketing is in doubt.

Even using boosted posts and ads, Facebook is a negligible contributor to online sales. According to a MyCustomer study, only 2% of all e-commerce traffic currently comes from social networks, 85% of that from Facebook. And conversion rates for this traffic are under 2%. Multiply that through, and we can see that direct-from-Facebook traffic accounts for 0.03% of e-commerce sales. In South Africa, where e-commerce in total is about 1% of retail, Facebook is not deserving of its prominence in marketing strategies.

Of course, averages can be misleading, and there are always exceptions, but the numbers are hard to escape.

Messaging vs Social

You invest heavily in creating content which builds a Facebook fan base. But Facebook owns your fan base and your data, and sells this audience to your competitors through intimately targetable advertising. Then, in an inspired bait-and-switch, it blocks your posts from reaching the news feeds of your own fans, unless you too pay to achieve this. How is organic posting and fan-base growth a smart way to market your brand?

In the past, your Facebook posts were delivered to the newsfeeds of less than 2% of your fans; very few of those were seen. That 2% is now moving to zero.

But, according to a Mobile Intelligence Review report, 98% of your mobile messages are opened, 90% of them within three seconds. So a new WhatsApp or Messenger list subscriber is worth way more to you than a new Facebook fan.

Intimacy is what distinguishes meaningful relationships — the conversations we value most are always private. Why is Facebook still the focus of your relationship marketing?

Conversational Commerce Rises

Messaging — conversational marketing — is displacing social media posting for building customer relationships, and for growing sales.

As inexpensive and increasingly powerful plug-and-play cloud-based AI proliferates, it has brought even small companies the power of natural language processing and voice interfaces. Where once taxonomy-structured trickle-down navigation defined paths through websites, conversational interfaces are becoming the preferred new User Interface.

Why should you go to a website, click “clothing” then click the “women” tab, then “knitwear” then read and select various filters (waiting each time for pages to refresh); then have to scan through a dozen or more product photos, clicking to the product pages of those which might be interesting; make a selection; then fill in payment and delivery forms? While faster than having to drive to a mall and fight the crowds, only to find your size is not available, this is still linear, arduous and annoying.

How much more pleasant is the customer experience of conversational commerce? You simply say “OK Google — on the way to my sister’s house I need to buy her a warm pure-wool sweater size M in cream or white, for less than 500 bucks.”

The AI knows which stores you have accounts with or shop at, knows your brand purchase history (may even know your sister’s preferences); it knows where you are, where she lives, and what route you are taking.

So it goes shopping for you, and in seconds says “Turn left at the next stop street. Foschini in the mall has one. Shall I have them hold it for you?”

Later that week you might say “Alexa, plan Friday’s dinner party. You know my friends better than I do, so create a menu they will all enjoy, and order the ingredients.”

According to ComScore, by 2020 (that’s 18 months away) half of all searches will be by voice. We are already accustomed to saying “OK-Google” to search for information or directions or restaurants.

Once e-commerce embraces voice interfaces and conversational commerce, nobody will bother to type and read again. Fingers and eyes are slow — voice and ears are fast, especially in a multitasking world.

Personalised me-commerce via messaging is the intelligent growth hack. But big brands are slow to change.

Traditional retailing, banking and financial services will be challenged by niche start-ups, and by Amazon and Alibaba — who have powerful cloud based multi-lingual AI systems already at advanced stages of deployment. In developing countries, where illiteracy has been a growth handicap, using AI & conversational interfaces will make customer literacy irrelevant.

Chatbots Proliferate

The entry point to this new conversational world is the chatbot, and it’s first viable use case is in CRM. Chatbot messaging is heralding a revolution in customer service.

I recently had to cancel a trip to Italy at the last minute. I spent nearly an hour on the Emirates website being redirected from one page to another, without success.

Nowhere could I cancel an entire itinerary (though I could cancel legs of it one at a time, each time having to accept an increased fare for the adjusted trip). The ticket office was closed for the weekend so I could not phone a human agent. Eventually I downloaded the Emirates app, and found a 24/7 chat system, where, in less than a minute, my problem was resolved.

I believe I was chatting to a person, though I might as well have been chatting to a bot. A simple task was accomplished via the app with three simple answers to three simple questions. I will never use their website again.

A Forrester study tells us that for 73% of customers, valuing their time is the most important way to provide good service. A Nielsen study found that in 2016 (before bots got smart) 56% of people would rather message a business than call customer service. For the customer the advantages of bots are speed, quality, immediacy and personalisation.

For the brand, the advantages are consistency, cost and scalability — one bot can handle thousands of conversations simultaneously, 24/7, handing off seamlessly to human agents whenever things get tricky, or whenever the customer requests it.

A bonus of bot-based CRM is its enormous capacity to access, store, and understand customer data and customer behaviour.

The major tech players — Amazon, Google, Apple and Microsoft — have long had their AI-enhanced voice assistants (Alexa, Siri, Google Assistant and Cortana). Google’s AI seems to be leaving the others in the dust in terms of understanding, answering and natural voice emulation. Alexa is a powerful e-commerce order taker. But now Facebook is becoming a serious commercial relationships contender with upgrades to Messenger and WhatsApp.

While the power in social networks lies in people talking with other people about your brand, the power in messaging lies in people talking with your brand about their needs.

Social media builds awareness and endorsement. Messaging builds relationships and sales. Even Mark Zuckerberg has said “Messaging is one of the few things that people do more than social networking.” And messaging platform usage is increasingly outpacing social media platform usage.

WhatsApp Gets Creative

From a marketing perspective, how might messaging be used to get closer to customers without being overly intrusive? Two very low-tech examples illustrate the potential of WhatsApp:

Absolut Vodka in Argentina launched a Limited Edition “Absolut Unique” bottle collection. It was launched with a very exclusive cocktail party full of big-name celebrities. Only two party tickets were made available to the public. To get them, you had to connect with Sven, the bouncer, and persuade him that you were the right person to get the tickets. The only way to talk to Sven was through WhatsApp.

The campaign generated over 1,000 unique images, videos, and audio messages, and built buzz in the community. More importantly, it added a ton of die-hard brand fans to the messenger contact list.

You can see the video here: https://www.youtube.com/watch?v=ozFLRwzyO6Q

Hellmann’s mayonnaise in Brazil ran a WhatsApp campaign that was so successful it was replicated in other countries. Hellmann’s wanted to encourage people to see their mayonnaise as not just something to put on salad, but as an ingredient in all kinds of dishes. In their WhatsCook campaign, they invited people to provide their phone numbers and a photo of the contents of their refrigerator. Professional chefs then suggested a dish which could be made with Hellmann’s and each participant’s fridge ingredients.

They sent recipes, instructions, tips and videos, answered questions through the cooking session, and even sent reminders to take the dish out of the oven. Result: 13,000 participants spent an average of 65 minutes interacting with the brand — and sharing the experience with friends.

Messenger Goes Commercial

See the video here: https://www.youtube.com/watch?v=xYN9A09iy5Y

So even without the benefits of a bot, personal conversational messaging marketing can engage deeply.

WhatsApp is not yet very marketer friendly, but there is an upgrade to that due imminently. Facebook’s Messenger is at the same time going after the bot business, enabling a lot of interface possibilities.

Here are some ways brands can exploit Messenger:

Basic and Advanced Bots Are Everywhere

  • Every brand which wants to engage with its customers should create a Messenger code. Use Messenger codes which take a user right into a conversation with the brand, either by scanning a hardcopy of the code on marketing collateral, or by hard-pressing it on a screen.
  • Use Facebook or Instagram ads to trigger one-on-one chats, instead of the usual approach of having ad taps take the user to a landing page.
  • You can set up your Facebook page so that you Message someone when they comment on your page. Use tools such as ManyChat or Chatmatic to do this. If a user responds to the triggered message, you have acquired a personal connection easier than asking for an email address.
  • Brands can improve the UX of product search in a Messenger bot, by showing a customer products and offering answers, or by providing filters to see more options.
  • By tapping into your chatbot’s data, you can learn each customer’s preferences. This allows your chatbot (or even in-store staff with database access) to always be relevant in your suggestions. Chatbots can use interaction history to profile customers or personalise communication.
  • You can even do transactions within a chatbot, as anyone who has booked a flight or bought a ticket to a show already knows. Facebook is making it easier to integrate personalised ecommerce (me-commerce) into Messenger.
  • Chatbots can provide personalised 24/7 support during the purchasing process. Since 83% of consumers require some degree of customer support while shopping online (LivePerson’s Connecting with Consumers report), this helps to boost conversion rates.
  • Bots already send proactive alerts (your ad campaign is about to end; your credit card is about to max out; don’t forget to check in online for your flight). But in Messenger they can also be used to send personalised commercial alerts (you can get 15% discount on those Converse sneakers you were looking at last week, for one hour only).
  • Chatbots can be used to automate simple tasks such as confirming reservations or changing a delivery address. This saves time for the customer and lowers the call centre overhead.

eConsultancy’s 2018 Digital Trends survey found that among CMO’s worldwide, the most exciting opportunities for 2018 were optimising customer experience and data-driven personalised marketing. You can’t do much of either without going conversational. And you can’t go conversational at scale without bots.

Bots don’t have to be rocket science, though they should be a step up from a phone-tree script. There are lots of plug-and-play services available in the cloud. These let you use AI of varying levels to converse and learn.

  • At a very elementary level, Faqbot makes your FAQ conversational, by simply connecting your FAQ page to their bot.
  • Mentioned earlier, ManyChat (which is free) helps you create and run a Facebook Messenger chatbot. It will automatically message anyone who comments on your Facebook page.
  • Botsify is a drag-and-drop chatbot creator for websites.

There are hundreds of AI startups offering plug-in interfaces. Read up on them, experiment, and learn. Most, because they are limited in their scope, are not especially powerful and may not appeal to the needs of large corporate brands. But they are a good place to start.

Enterprise-grade chatbots are typically custom-built, requiring bigger budgets and more IT support. The best bots include all or most of the following:

The Business Case is a No-Brainer

  • Really good machine learning (it improves itself with experience)
  • Integration across different channels (such as website, apps, social media)
  • Seamless escalation to a human agent
  • Simple but robust integration with legacy systems (CRM, e-commerce, inventory)
  • A perceptive intent engine which knows from each customer’s engagement history and current context what the customer is trying to achieve
  • Natural language processing, ideally multilingual
  • Robust reporting and analytics
  • Good security, authentication and privacy protocols to protect customers and corporate systems

Enterprise-grade chatbot providers are less numerous than simple bot providers. In addition to AWS and IBM, some of the more prominent include [24]7, Ipsoft and Nuance. But more emerge every day.

The business case will normally hinge around CRM savings, customer retention, and sales conversion. US rail company Amtrak has a bot called Julie. Julie handles half a million queries a year and saves $1 million in annual call centre costs. She also increased travel bookings by 25% and closes sales which on average are 30% higher than the sales made by human agents.

Within two years AI will disrupt the jobs of one million phone-based customer support agents (Gartner Group). Much of that will be happening through conversational interfaces in messaging apps. But the impact of conversational AI and bots goes well beyond call centres. They will become core drivers of sales and customer loyalty, and will be integral to our perception of each brand’s UX.

If you want your brand to stay relevant and gain efficiencies at the same time, it is imperative that you craft a conversational interface strategy and start experimenting today.


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Created by

Godfrey Parkin

Strategist, edtech pioneer, digital marketer, futurist, author, disruptor. CEO Britefire, MindZu.


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