Traditional customer contact channels are leading businesses down their Kodak-like demise
Many of them today remain resistant to embracing smartbot (AI-powered chatbot) technology and prefer to continue holding onto SMSs, emails, and call centres to engage customers due to the perception that they are a cheaper alternative to newer technologies.
'South African businesses are at risk of mirroring the same devastating oversights committed by Kodak. The pioneer of camera and film, which introduced the first-ever handheld camera in the late 1800s, was one of the top performing companies on the New York Stock Exchange at the peak of the 20th century. Within 10 years of that achievement, they had to file for bankruptcy. Their mistake: failing to capitalize on the growing digital photography market,' says Jonathan Elcock, co-founder and CEO at rather.chat.
At present, traditional customer communication channels are not providing the sales results needed to keep businesses profitable. In fact, when businesses try to call their customers, they fail to reach 30% to 40% of them. This results in a low return on investment, forcing businesses to invest more heavily in top-of-funnel activity by allocating more resources to increase customer leads to counterbalance the lost conversions. This effectively becomes a vicious cycle of profit burning and risks the business becoming redundant.
But while businesses cling to traditional tactics like Kodak clung to film, smartbot technology has already moved to mainstream platforms, such as WhatsApp, where the customer's entire interaction with the business – whether through queries or sales – can be hosted.
Elcock added that 'today's innovation is tomorrow's commoditization. A business can only grow at the speed of their customer's trust. Using traditional channels of communication erodes trust because trust is now linked to response time. Relying on a human to respond to email or SMS queries always guarantees some length of delayed feedback, which in result fails to respond to a customer's primary need: convenience. One would not trust a doctor that takes a week to respond to an appointment request via email, so why would a customer remain loyal to a business that does the same?'
WhatsApp smartbots can deliver results that traditional methods like email and SMS can't do. While those channels offer quantity-based metrics like click-through rates, they fail to provide deeper customer insights. For example, a low email click rate might suggest inactive addresses — but that could be a false conclusion, as the data only explains what happened, not why.
WhatsApp smartbots, powered by AI, go further by providing qualitative, behavioural data that indicates the why behind customer actions. They track the entire customer journey in real time, revealing exactly where and why breakages occur.
'Traditional e-commerce platforms might show that 80% of users abandoned their carts. WhatsApp smartbots have the potential to reveal that 60% of those users had unanswered questions, offering a clear path for improvement. This data can give insight into what exactly discouraged the customer, and how to optimize the breakage to improve the experience for the customer the next time,' Elcock described.
Smartbot technology is also increasing profitability by reducing wastage and helping businesses with more efficient use of resources. Think of a company that provides tertiary education loans, but with prerequisites such as a threshold on monthly income. The Whatsapp smartbot would pre qualify customer leads in a chat by asking the potential customer a series of questions, before handing over the hot lead to a contact centre agent to lock down the sale with a personal, human touch. Without the smartbot's presence in this sales process, call centre agents would inevitably waste time trying to make contact with leads and disqualify 60% of them.
'Kodak's parochial business attitude provides product and service-centric businesses of today a valuable lesson: technology changes with time. New innovations arise and automatically update older practices. We need to continue adapting to the trends. You can either embrace it or wait for your next competitor to come along and take your place,' Elcock concluded.
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