Conversational commerce
March 22, 2017 | Shares:

Conversational Commerce: The Future Has Arrived
5 min.

For every industry, staying ahead of the most recent trends is the only way to survive, excel, and thrive in our ever-changing world.

A consistent focal point for businesses is how we interact with our customers.

Over the years, the way we all approach tackling this has dramatically changed.

Today, marketers need to be everywhere — which is why having a strong omnichannel strategy is necessary to navigate through changing times.

The emerging approach that is permeating Silicon Valley, eCommerce retailers, and startups around the world is conversational commerce.

Conversational commerce: The real-time customer communication through various messenger applications and bots.

In 2016, conversational commerce platforms became a priority for some of the world’s biggest companies like Facebook, Shopify, Slack, and Google.

In this article we break down how conversational commerce impacts eCommerce and tackle questions like:

  • What does conversational commerce mean?
  • Why is it a critical component of the customer journey?
  • How do eCommerce bots interact with customers?
  • How is it changing the way online businesses gather insight about their customers?

What Is Conversational Commerce?

The term conversational commerce was first coined by a former Uber developer, Chris Messina.

Messina explained conversational commerce as a shift in which businesses leverage the power of social messengers for customer communication.

According to Statista, both Facebook Messenger and WhatsApp have an active monthly user base of more than one billion people.

social platform user base

That means one in every seven people in the world interact with either Facebook Messenger or WhatsApp.

This is a huge opportunity for brands–in no other online space do you have access and touchpoints to as many potential users, customers, and shoppers as you do with conversational commerce apps.

But tapping into this user base isn’t easy.

There is a fine line between being accessible and intrusive in messenger bots

For brands who can do it well, conversational commerce is becoming an integral and powerful part of the customer journey.

How Conversational Commerce Impacts Shoppers

When deciding to make a purchase online, people go through various stages before and after clicking on that checkout button.

There are five distinct steps in the customer purchase journey:

  1. Need recognition (Awareness): The first and most important stage of the buying process, because every sale begins when a customer becomes aware that they have a need for a product or service.
  2. Search for information (Research): During this stage, customers want to find out their options.
  3. Evaluation of alternatives (Consideration): This is the stage when a customer is comparing options to make the best choice.
  4. Purchasing decision (Conversion): During this stage, buying behavior turns into action – it’s time for the consumer to buy!
  5. Post-purchase evaluation (Re-purchase): After making a purchase, consumers consider whether it was worth it, whether they will recommend the product/service/brand to others, and what feedback they would give.

The question then becomes, where exactly does conversational commerce fit into the online purchasing journey?

The answer to that is every single one.

Let’s break down each section of the customer journey again, this time looking at how conversational commerce plays a role in each part of the process.

1) Awareness:

Conversational commerce platforms help businesses create a sense of need for their products to potential customers.

An already growing trend in the conversational commerce world is using the channel to push relevant content from your brand. Quartz uses this strategy to keep their audience informed.

conversational commerce app example

A quick message from a user via their conversational commerce platform elicits a response from their chatbot with a relevant piece of news.

This seamless connection is a great way for eCommerce stores to let consumers know about the latest products or sales.

2) Research:

Potentially the most influential part of the purchasing journey, customers are always looking to have the widest choice of products available to them.

However, doing research on finding multiple alternatives and choices can prove to be a time-consuming task. Enter conversational commerce chatbots, which are able to act as a personal shopping assistant to customers everywhere.

Adoro, an online fashion network, is changing the way customers research the items they are interested in purchasing.

Adoro's conversational commerce bot

In response to simple commands such as, “show me some blue dresses,” or “I need something to wear to a wedding,” the Adoro chatbot lists multiple options to choose from.

Gone are the days of countless hours researching products on various websites, and in comes an era in which conversational commerce helps us discover our new favorite eCommerce brand.

3) Consideration:

Once customers have identified what they want and curated a variety of options to choose from, they then consider said options in front of them.

For those looking to leverage conversational commerce at this stage, look no further than to model what JD.com, China’s largest eCommerce retailer, is doing on the WeChat messaging platform.

JD.com has developed a conversational commerce platform on top of WeChat where potential customers have the opportunity to consider a wide variety of items to choose from.

JD conversational commerce platform

This type of convenience for customers is what conversational commerce is all about.

4) Purchasing:

Mobile commerce has grown exponentially over the last few years.

According to Yotpo data, mobile now accounts for half of all eCommerce purchases, with 65% of people starting their customer journey on their smartphone.

Conversational commerce apps are a perfect complement to the purchasing stage of the customer journey. Instead of having to send the user to a checkout page on their desktop, chatbots can provide a seamless buying transition right on your smartphone.

Snap recently rolled out shoppable stories with select eCommerce partners such as Lancome and Target in the discovery section of the app, as a way to monetize its daily user base of more than 160 million people.

Snapchat's conversational eCommerce app

As you can see from the above graphic, Lancome and Snapchat teamed up to provide users with a stimulating, visual, and creative conversational shopping experience.

Visitors to the story are able to swipe up on products that resonate with them, which then redirects them to an embedded eCommerce page within Snap to complete the purchase.

This type of conversational commerce is a new, innovative way for Snap and their brand partners to make the purchasing part of the customer journey frictionless and fun.

5) Post-Purchase:

In the last stage of the customer purchasing journey, shoppers evaluate the value of the product they just bought. This entails going over the cost, usability, and quality of the product.

For online businesses, the best way to gather this information would be a chatbot that requests customer feedback.

Customer content provides tangible information, both positive and negative, about a consumer’s overall experience with your product and company.

Conversational Commerce Trends: Where We Are, Where We’re Going

Conversational commerce is unequivocally here to stay, and there are a variety of different functions for users.

In order to get the full scope and reach of this new technological medium, let’s look at some of the ways businesses are leveraging conversational commerce.

Amazon Echo: Meet your new online shopping personal assistant

We all know Amazon as the Goliath of the eCommerce world.

With 54 million Amazon Prime members in the US who spend an average of $1,100 per year, Amazon is the go-to marketplace for online shoppers.

Amazon Echo’s Alexa is the online marketplace’s biggest foray into conversational commerce, allowing Prime subscribers to order directly from the Amazon product catalog without ever having to lift a finger.

The video below demonstrates the ease of ordering right to your door without ever having to open up your smartphone or laptop.

Slackbot: Where office hunger meets conversational innovation

Slack has cemented itself as the premier service for intra-office communication, updates, and good old coworker bantering.

Recently, Slack has allowed developers to build on top of their bot platform, which helps daily slack users with various tasks and requests.

Our favorite chatbot to be developed for Slack is Taco Bell’s brilliantly named TacoBot.

As a conversational commerce platform, the TacoBot can take orders for your office directly from the Slack extension.

Simply have a conversation with your favorite TacoBot, and get to enjoying that delicious soft taco you have been craving all week.

Tacobot slack bot

Without taking itself too seriously, the TacoBot actually provides an incredible model for fellow companies looking to enter the conversational commerce app world.

With more than 3 million daily active users, the Slack office has a channel dedicated to deciding where to go to lunch next. With the TacoBot, conversational commerce has officially reached a whole new level of delicious.

Google Allo: Predicting the conversation before you do

You know that conversational commerce is a trend here to stay when Google jumps aboard.

Trying to rival the wildly successful Facebook Messenger app, Google has recently developed Allo, a messaging platform with Smart Reply functionality.

Smart reply commerce app

Conversational commerce is a natural progression for Google, which is intertwined in the lives of billions of people.

Allo aims to be a personal digital assistant that creates intelligent replies before you even think of them yourself.

This type of AI technology is no longer the future of how we connect with each other, but now officially the present.

H&M: Shopping bots is a trend here to stay

Perhaps the most impressive eCommerce conversational commerce bot to date is the one H&M developed on the Kik marketplace.

With more than 300 million users, Kik has positioned themselves as the go-to conversational commerce platform for eCommerce businesses to utilize.

Kik marketplace - conversational commerce app

What’s so cool about the H&M chatbot is how their conversational commerce style is laid back and engaging.

The bot uses emojis and slang to appear as though there is an actual person on the other side of the screen, instead of just an AI learning machine.

The H&M chatbot certainly plays to their target audience, and we foresee other major fashion companies following suit by leveraging conversational commerce.

Wrapping Up

Companies around the world are investing countless resources into cornering the chatbot market before their competitors.

For eCommerce businesses, the choice is clear. Having a comprehensive, robust conversational commerce strategy is imperative for continued success and revenue.

Where do you see conversational commerce going in 2017?


Check out our useful tips about Facebook Messenger!
Learn more about conversational commerceDownload NowHow to grow your online business with social and conversational commerce
Corey Bloom
Corey Bloom, Content Marketing Manager at Yotpo
Corey is a Toronto native living in Tel Aviv. You can find him looking for the best place to eat wherever wanderlust takes him next.
  • This is very interesting. I’ve seen a lot of businesses already taking advantage of messaging bots to communicate with their customers and it actually works. But I think Adoro showed great example. This could also be one tool that companies could maximize on to strengthen customer engagement especially for general inquiries that customers would need a quick response on.

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