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SMS-powered chatbots and the massive missed opportunity

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1/30/2017 9:10:20 AM
SMS-powered chatbots and the massive missed opportunity
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Posted Monday, January 30, 2017 by Richard Harris, Executive Editor


SMS-powered chatbots and the massive missed opportunity
There’s a lot of buzz around chatbots in the technology industry - what they are, why they’re valuable, how to build a better one, etc.

Despite being popular on the tongue however, a new industry survey which polled over 1,500 mobile users in both the US and UK is acting as a wake-up call to enterprises as consumer preferences for new-age mobile communication channels, like chatbots, are not being met across the board even though the majority polled would find SMS-powered chatbots “very useful.” It's because of this that we decided to sit down and talk to Tim Fujita-Yuhas from OpenMarket to find out mroe about this strange phenomenon.

ADM: What is the benefit of SMS-powered chatbots and why should companies look to harness this effective communication strategy in 2017?


Fujita-Yuhas: The key benefit to SMS-powered chatbots, aside from the adaptability to a large number of customer touch points, is the technology’s unique ability to improve the self-service customer experience (CX) while lowering business costs. This is a rare combination because more often than not, improving CX requires spending money, not saving it. While customer demand for timely and relevant interactions with preferred businesses continues to increase in 2017, those companies with SMS-powered chatbot services will be able to not only help improve their bottom line while delivering on conversational SMS requests, but put a stake in the ground that differentiates them from their competitors. Regardless of the industry - retail, finance or hospitality, for example - you’re part of the majority if you’re currently missing out on the huge opportunity.

ADM: What are specific examples of how retail, hospitality and financial service companies can leverage chatbots?


Fujita-Yuhas: The simplicity and quickness of SMS-powered chatbots make them an ideal form of self-service communication technology for a variety of industries, and those in high demand include those that serve everyday needs - such as travel and hospitality, retail, and finance. In the case of hospitality businesses, one of the key drivers of chat bot services is regarding the check-in/check-out and concierge services. For example, chatbots can send SMS messages to customers ahead of check-in to alert them of their room number and invite them to text questions during their stay. Customers can send an SMS message to the hotel’s chatbot line to receive the Wi-Fi access information, request additional towels, or even order room service. These types of consumer needs are met equally as effectively and efficiently by financial service providers delivering fraud notifications, account balances, and by allowing consumers to self-serve with the bank in real-time when they receive account status or transaction notifications. In retail, consumers are able to get sale alerts and discount coupons straight to their smartphone for use at checkout.

ADM: The majority of consumers wish to receive SMS communications from preferred brands but are rarely receiving them - why are companies missing the mark?

Tim Fujita-Yuhas

Fujita-Yuhas: According to our recent survey that polled 1,500 mobile users in both the U.S. and U.K., businesses are missing the mark with SMS communication services by simply ignoring their customers’ preferences. For example, 75 percent of consumers polled aren’t currently receiving text messages from hospitality and travel services such as airlines and hotels. Sixty-two percent of consumers aren’t getting messages from their preferred retailers, and another 50 percent aren’t getting notifications via SMS from their financial service providers. It’s worth noting that this is despite business-to-consumer text messages across all three industries are in demand.

The reasoning behind this is likely two-fold. The most consistent reason we hear is that companies do not fully understand the capabilities of SMS and the ease with which advanced services can be provided to their customers through innovations such as AI-driven chatbots. Another reason is the misconception that customers would rather communicate via more traditional channels such as email and voice calls. However, this is simply not the case. Sixty percent of consumers recently polled said they prefer having two-way texting engagement capabilities with businesses because it’s convenient, fast, and easier to use. This is in part due to how naturally text messaging comes to today’s consumer, who texts on average 10 or more times a day.

The reality is, postal mail, email, and voice calls all fall behind SMS as a preferred communication channels for consumers - particularly millennials. With heightened awareness, hopefully we’ll begin to see fewer businesses missing the mark on consumer engagement this year.

ADM: How do you believe that chatbots will disrupt mobile in 2017? Why?


Fujita-Yuhas: Chatbots using machine learning will disrupt the mobile industry in 2017 by becoming more mainstream and widely available for public use. SMS-powered chatbots are more than just a solution for millennial customers. The technology for improved self-service via SMS has already been in place, but consumers were either unaware of the fact that they were communicating with a chatbot - think keyword based responses such as text banking - or viewed it as a fleeting trend. Despite the constant fluctuation of the marketing field swayed by customer preferences, one staple has remained consistent and cemented its place in consumers’ lives - the mobile device. As other more trendy solutions such as relying on the mobile app for self-service show themselves to the door, SMS-text messaging has not only been proven and consistent, but it’s actually evolving along with the customer’s expectations. We’ll continue to see better self-service via SMS-chatbots in the New Year as chatbots find a home in every consumer-facing industry.

About Tim Fujita-Yuhas


Tim currently serves as Director of Product Management and New Product Strategy for OpenMarket’s Mobile Engagement Platform, specializing in enterprise mobile engagement services. He is responsible for product strategy and business planning for the company’s mobile messaging solutions. Tim blogs regularly on mobile engagement topics.

Prior to joining OpenMarket, Tim held a variety of Product Management positions focused on voice, video and mobile communications, and SaaS technologies. While at Varolii (acquired by Nuance in 2013), he was responsible for the company’s cross-channel platform, APIs, and developed their mobile app with push notification service. While at Cisco’s Unified Communications (UC) Business Unit, Tim managed their industry leading UC products and led the global Unified Messaging deployment working with Cisco IT that saved the company over $7M.

Tim graduated from Boston University with a Masters in Software Systems Engineering.

Here's a helpful SMS chatbot infographic provided by OpenMarket


SMS Chatbot Infographic





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