Conversational Commerce: Are Brands Getting the Message?

Messaging apps have quickly evolved from a vehicle for chatting with friends and family to a channel for commerce. While these apps have been popular for giving people ability to share GIFs, messages and photos with their close circles, they have expanded into a valuable channel for brands and retailers to connect with and sell to consumers.

The messaging app market has exploded in popularity, eclipsing the top 4 social networks in active users as of late 2015. This has presented a unique and nuanced monetization opportunity for smart brands willing to invest in technological innovation, cater to their customer base and stay ahead of the curve. Enter conversational commerce, which has come to mean interactions between consumers and businesses that take place via messaging apps (think iMessage and Facebook Messenger) or voice-activated devices like Amazon Echo.

Conversational commerce is nascent, but brands are already pairing it with other technology, like AI, to engage and delight their clients. Merchants are using chatbots within messaging services that enable brands to converse with consumers in an automated way. Chatbots can make suggestions, provide content and even sell to people, while collecting information and acting as a customer service tool. Since they don’t require additional installations or apps on the consumer-end, they are an appealing tool that makes for a great customer experience.

On the brand side, chatbots can be a seamless way to connect with consumers within their favorite apps. Meeting consumers on their preferred playground and allowing them to browse, shop and make purchases through a messaging service is next-level customer service.

Matching Consumer Sophistication

While there are many low-cost chatbot options available to retailers, the key is in providing a streamlined, tailored experience for customers. Today’s consumer—and millennials in particular—are more interested in authenticity than a hard sell. They are seeking a customized experience that puts them in the driver’s seat and makes purchasing incredibly easy.

Artificial Intelligence (AI) has entered the scene to make this a possibility. AI-based bots create deep engagements with customers through personalized interactions grounded in the customer’s needs.

MasterCard recently launched purchasing capability via chatbots within Facebook Messenger. This announcement comes on the heels of Facebook introducing a chatbot API within its Developers platform.

Through a partnership with MasterCard, brands can use these AI-based bots to expand commerce options for consumers and enable browsing, ordering and secure checkout through Masterpass—all within the Messenger platform.

The Gift of Connection

Beyond the ability to engage with brands and make quick, easy purchases through mobile messaging apps, conversational commerce has the ability to foster relationships among friends and family—all facilitated by brands.

Starbucks now enables consumers to send gifts through the iMessage app via a plugin built on the native app iOS infrastructure. By utilizing CashStar technologies that support Apple Pay, real-time-gifting and real-time gift card activation, Starbucks can be sure transactions are quickly and securely processed.

This new capability is the definition of “Gifting Made Easy” and provides Starbucks with a unique channel through which it can connect with customers—and help customers connect with each other through the act of gifting. Starbucks’ forward-thinking initiative makes it the first among CashStar’s broad list of top-tier clients to implement this capability within iMessage.

The Cheesecake Factory has also tapped into this “sweet spot” by partnering with CashStar to enable the purchasing of personalized gift cards directly through Facebook Messenger. Combining CashStar’s ability to instantly approve and activate gift cards with new commerce channels like Messenger has spurred deeper engagement with guests. Users can customize their gift card and enjoy a frictionless checkout process, all through Messenger via Masterpass.

What’s more, by using CashStar’s real-time gifting to instantly approve and activate gift cards, the brand removes its fraud liability. The bot simply sends payment information stored in the Masterpass digital wallet directly to CashStar, where the transaction is processed via CashStar’s real-time-gifting solution. The transaction is automatically scored and decisioned, avoiding manual review. Upon transaction approval, CashStar activates the gift card in real time. The Cheesecake Factory is the first brand in CashStar’s portfolio of leading merchants, retailers and restaurants to implement the bot capability for Facebook Messenger.

Mobile Matters

This type of innovation is slated to be a big win for the innovative brands who have heard consumer feedback and put it to good use. Enabling consumers to shop and securely purchase through messaging apps is key, given the engagement the platform sees from users.

Almost 80% of social media time is spent on mobile, according to a comScore report. Facebook Messenger alone had roughly 105.2 million active US users in 2016, according to eMarketer’s report, “Facebook Messenger: Strategies for Customer Service, Ecommerce, Content and Advertising”. The app is used by 40% of mobile phone users and is the leading over-the-top (OTT) mobile messaging app and a prime playground for brands to foster relationships with their consumer base and engage them with new and exciting offers.

It’s not hard to see how brands that harness the combined power of messaging apps and gifting technology can tap into new revenue streams and boost their brand reputation in the process. Working with a proven gift card ecommerce solution delivery partner can set brands far ahead of the competition, all while facilitating deeper engagement with the customer base and driving new revenue.