Conversational commerce is an evolution of the app economy, representing the third wave of marketing strategy. The first wave was broadcast, a single message aimed at all potential customers via magazines, radio, billboards and TV. The second wave was the internet which allowed for more personalised broadcast messaging via email and targeted ads. The third wave is conversational commerce, which elevates the interactivity offered by websites, apps and email to a new level.
Conversational commerce is all about mobile messaging, which has been steadily growing over the last decade: 25 billion mobile messages are sent every day. Over 3billion people use texting and mobile messaging apps every day. And this is what conversational commerce taps into.
Not all companies have managed to understand the full potential of conversational commerce, but at MEF (the Mobile Ecosystem Forum) we anticipate the market will grow rapidly over the next few years as more businesses register the benefits. And this is the tip of the iceberg. Conversational commerce will fundamentally change the way we buy, sell, and serve our customers.
To help your start-up to get ahead of the game, here are three things you should know about conversational commerce if your business is to grow over the next five years.
1. Broadcast messaging is out
Broadcast messaging is about sending the same message to everyone. It works extremely well to build and establish a consistent brand but is terrible when it comes to interaction.
People now expect to have a meaningful conversation about products and services. They want to know what the experience of the brand is like, to really feel it. That’s why influencer marketing is so popular – there is an opportunity to engage with a real person and understand the brand experience.
A number of challenges are also leading to the rapid decline of broadcast messaging: people skip ads by watching more streaming services; podcasts are on the rise; and email is so full of spam that it’s almost impossible to get noticed.
2. Understand the new Messaging Channels
Conversational Commerce will be delivered over a variety of messaging solutions, and the landscape continues to change – it is important for entrepreneurs to be familiar with the tools of this new trade. Some of the messaging solutions are familiar. Millions of businesses already rely on SMS for simple communications with consumers. WhatsApp is known for personal messaging; it is now joining the business communication with new features. Different markets show different take up: the USA prefers Facebook Messenger, WeChat dominates in China, Line in Japan. The list is long.
One messaging channel that should be known by many is RCS (Rich Communication Services). You can think of RCS as an evolution of SMS. Over 1.2 billion smartphones are already RCS enabled, so the potential is huge – and growing. RCS is supported by big tech companies like Google and the mobile operators that created the SMS texting in the first place. RCS is now replacing the SMS inbox in Android phones.
RCS has also been designed to facilitate a host of new opportunities for businesses and brands to engage with their customers, build relationships and increase sales. RCS offers an upgraded experience with unique features to enable rich and meaningful engagements among users and businesses.
What will make RCS so popular is that it brings new benefits to consumers: you can send larger, higher-quality images; stream audio and video; provide better group chat capabilities; enjoy greater security than found with most apps; and make use of a number of in-call and post-call features.
And with this popularity and growth among consumers comes opportunities for business for engage in true conversational commerce that will build lasting relationships with customers.
3. Persona marketing is in
To elevate their marketing and meet the needs of modern consumers, brands need to become personas. Through Conversational Commerce, brands can now both sound and behave like a person. They can be their own influencer.
They can describe and explain products, engage potential users and discover their needs, convert people into loyal customers, and provide a fantastic ongoing service.
Take, for example, a retailer selling barbeques in bricks-and-mortar stores. Typically, they will sell lots of products in June and, if they’re lucky, see customers again in a year.
With conversational commerce, this retailer can understand their customers’ needs (e.g. having a garden party), can service those needs (e.g. informing customers when the weather is likely to be sunny or sharing recipes), and provide ongoing support (e.g. how to effectively clean and service the barbeque).
RCS allows the retailer to deliver a tailored mix of video instructionals, personalised messaging and two-way interaction. This can elevate a simple sale into an ongoing relationship with their customers. The retailer can better understand their customers and their needs and thereby provide the very best service. Which in turn leads to recommendations and repeat business.
What about cost?
Providing an orchestrated omnichannel conversation commerce strategy that looks after every customer’s individual needs would be prohibitively expensive for most start-ups. Fortunately, AI can guide customers in the right direction and quickly learn what they need.
While chatbots have, historically, been unpopular due to their frustrating limitations, many of us are now speaking to chatbots without even realising. And they’re getting smarter every day!
It’s important not to outsource the entire process to robots, however. There is still an essential role humans play in conversational commerce. While the AI could help and guide customers, it may get to the point where they need to speak to a human being. And this is key to conversational commerce: giving people what they want and need at the right time in the most helpful way.
Conversational commerce is about listening, hearing, and helping. By understanding what your customers want and need, how and when they consume information, and opening the process up to two-way communication, your start-up or growth business will be able to create lasting relationships – transforming simple sales into a complete service.
ABOUT THE AUTHOR
Dario Betti is CEO of MEF (Mobile Ecosystem Forum) a global trade body established in 2000 and headquartered in the UK with members across the world. As the voice of the mobile ecosystem, it focuses on cross-industry best practices, anti-fraud and monetisation. The Forum provides its members with global and cross-sector platforms for networking, collaboration and advancing industry solutions.