Charting the Rise of Conversational AI

Published on February 23, 2020

The days when marketers believed nothing could replace human-to-human interactions are gone. As brands move their marketing strategies beyond the screen, one of the primary areas of investment is conversational AI.

Conversational AI is a broad term used to describe technologies that automate conversations and personalize customer experiences. With the right systems in place, brands are able to understand, process, and actually respond to voice inputs in a natural way. While voice assistants, chatbots, and messaging services like WhatsApp, Kik, and Facebook Messenger can all be harnessed in a conversational AI strategy, virtual assistants like Amazon’s Alexa and Apple’s Siri represent the cutting edge of the category for brand marketers today.

“Virtual assistants offer the greatest benefit for humans when they can understand, respond, and act quickly and accurately to questions and requests for help,” says John Castleman, CEO of the digital consultancy Mobiquity.

Castleman has built voice integrations for some of the world’s biggest brands, including Nestle and Butterball, and he has seen first-hand the pain points that thought-out voice-user interfaces can solve. He’s also been up close as brands made the kind of strategy errors that cost millions to overcome.

“We are at the relative infancy of conversational AI systems, and they are gaining in both popularity and maturity, as they gradually improve in how human-like they can handle our everyday needs,” Castleman says.

The biggest mistake Castleman sees brands making when it comes to voice is not having a defined strategy from the get-go. In his experience, brands that develop a voice strategy typically do much better than those that simply build singular experiences in voice.

With many consumers—and young people, in particular—already using conversational AI platforms like Amazon’s Alexa in place of email and face-to-face conversations, the time is right for brands to move further into adoption.

In the coming year, Castleman expects to see more brands using voice-user interfaces to allow the physically challenged to perform tasks. Brands will also use conversational AI to cut through the typical navigation hassles associated with mobile apps and online websites, and to give users access to their products when they cannot easily use their hands. For example, brands could use voice-user interfaces and conversational AI to provide information to consumers while they’re driving, cooking, or in some industries, while they’re doing remote work in the field.

The most forward-thinking brands will rely on conversational AI to build direct relationships with their customers and gain better insights into what they need. The best interactions will feel natural, personalized, engaging, empathetic, trustworthy, and fun.

“CPG brands, news distribution, retailers, [and] financial institutions should be thinking about how they can more directly connect with their consumers where typically they might have a less direct relationship with their end users,” Castleman says.

The next step in the rise of conversational AI will be for brands to develop trust with consumers when transacting over voice. Having the ability to authenticate users—for example, through biometrics that balance security with minimal friction—is one building block of that trust. Finding ways to pair voice with visual screen experiences is another.

“Companies are hungry to complement sales of their products or services in this new channel. As we have seen in other digital channels, it can take a while for users to truly trust in a channel before they’ll conduct transactions and commerce,” Castleman says. “Conversational AI is continually improving, but it needs to support an even more human-like interaction where people feel that they are fully understood [and are] comfortable making purchases securely.”

The article Charting the Rise of Conversational AI by Stephanie Miles first appeared on Street Fight Magazine.

Street Fight is a media, events, and research company focused on the business of hyperlocal content, commerce and technology. At Grit Daily, Street Fight covers the business of hyperlocal marketing, commerce and technology.

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