Chatbot Problem Statement Definition

What Problem Does Chatbot Solve?   

Chatbot is a self-service response system, which, in some cases, becomes the first-line support for customers through digital channels. The solution is designed to quickly and automatically address incoming buyer inquiries by engaging in human-like digital conversations without needing support agents’ intervention. It mainly refers to simple or common requests with predictable and programmable answers, often comprising a significant portion of total inbound queries. While their manual handling is relatively straightforward, it usually requires considerable time and resources. Employing chatbots helps to solve the problem by streamlining operations, increasing efficiency and fostering customer satisfaction. 

 In addition, the new generation of AI-driven chatbots emerges with increasingly advanced functionalities. They will be able to deliver more context-specific experiences and elevate response personalisation and accuracy, making this CX channel even more efficient.   

 In which cases are chatbots used?     

Chatbots are widely utilised across various industries, and their involvement is constantly growing with technological enhancements. They are prevalent in sectors where companies manage many inquiries, must deliver real-time assistance, address many uncomplicated issues, and face constraints in expanding their human talent pool. These include e-commerce, travel and hospitality, healthcare, education, finance and banking, insurance or telecom, where chatbots can be used, for instance, to:  

• Provide assistance in making purchases or the booking process. 
• Enable customers to track orders. 

• Share basic information, such as opening hours, store locations or product specificity. 
• Guide on the return or exchange policy. 
• Deliver recommendations based on the user’s preferences and purchase history. 
• Offer preliminary assistance with common technical issues. 

 What are the benefits of chatbots?     

Chatbots are crucial in enhancing the digital customer experience, speed-to-customer and efficiency. They enable live interactions and assistance 24/7, contributing to an increase in consumer satisfaction and a reduction in frustration and stress. Implementing chatbots is related to various benefits for businesses, including cost savings, the automation of routine tasks, improved contact centre metrics like response rate, customisation capability and the ability to scale services easily, particularly during peak hours or seasonality. Sometimes, chatbots can be helpful tools for employees, providing quick access to information supporting their daily routine. 

What are the challenges of using chatbots?    

Despite impactful advantages and plenty of benefits for business, using chatbots is also associated with some challenges, among which the most critical are: 

• Designing an appropriate conversation flow to impact user satisfaction through seamless and intuitive interaction. This should consider the chatbot’s ability to follow different paths in the conversation, select the most appropriate response and adapt to some unexpected situations. 
• Ensuring effective problem-solving and providing customers with relevant and satisfying answers. Chatbots may be limited by predefined rules or patterns, hindering their ability to understand unique queries, specific contexts, or nuances, which can result in the delivery of inaccurate or misleading information.  
• Effectively handling complex inquiries that require in-depth analysis, human sensitivity and intelligence, as these attributes are not yet fully replicated even by advanced technology. 
• Offering multilingual support, considering various languages, their regional variations, local nuances or different meanings of some terms and expressions. 
• Ensuring data privacy and safety when collecting information during each online interaction in an automated way. 

 How to overcome the limitations of chatbots?   

It is essential to be aware of the limitations and constantly track recent trends as chatbots are increasingly developed, providing more and more functionalities. Nowadays, companies can make frequent updates, monitor the quality of processes, correct conversation paths, train chatbots utilising data, ask users for feedback, and enable connection with a human agent when necessary. A solution is also successive implementation of AI elements like natural language processing to increase chat’s ability to interpret requests more accurately and boost human-like responsiveness.