2016 saw an explosion of interest and investments in chatbots, as I wrote in my last annual recap. What happened in 2017, and what will 2018 bring? Let’s have a look.

It is still early

Much like in 2016, this year I’ve had countless conversations about chatbot needs with technology innovators around the globe, and it’s clear to me that as an industry we have made progress. But it’s still early – very early. My focus is customer service within the enterprise, and both are places where emerging technologies aren’t rushed, but are eventually embraced fully once investment decisions have been made.

Adoption of most consumer-facing innovation starts in Marketing Departments. The term “shiny object” exists for a reason: humans have a fear of missing out. When we see something new, we are attracted to it; it’s in our DNA. And getting attention is one of the business goals of marketing. However, after you get somebody’s attention, you must engage. Conversations can only happen at scale if the right number of resources exist to lead these conversations. This brings us to the contact center – where conversations happen. Due to the criticality of the contact center to a business, as well as the fact that it is still (wrongly) considered a cost center to many C-suites, decisions are generally made conservatively. The opportunity for cost reduction, however, is very attractive and motivating to contact centers. And this is where chatbots can help. Keep in mind that historically, contact centers have tried everything to prevent the customer from reaching out, which is why the outlook of yet another “channel” is not attractive at first sight.

Innovation starts in Marketing, not the Contact Center, but budgets are forming in the latter

Having said that, it comes as no surprise that the high-profile consumer-facing chatbots deployed this year have for the most part not been deployed in the contact center, but in digital marketing. Whether it’s a bot helping grocery shoppers find the right groceries, beauty shoppers find the right product , flower shoppers find the right flowers, or wine shoppers find the right wine.

Most contact centers go through a formal RFP/tender process for new investments, and because chatbots got lots of mainstream media attention in both 2016 and 2017, budgets have indeed formed in 2017. RFPs for chatbots have arisen in verticals as diverse as banking, government, healthcare, and retail. Accordingly, I expect to see a range of new solutions see the light of day in 2018; solutions that bring the old solutions like Interactive Voice Response (cue the robotic ‘press 1 for English’ script) into the 21st century, on a channel people actually like to use. Looking at the technology adoption lifecycle, we are past the Innovator stage, closer to the right side of the Early Adopters group, most likely through the middle of the chasm that Geoffrey Moore described, where we’re trying to get to an early majority but need to change our marketing and sales methods:

Businesses will start building internal bots

I have had many companies find the idea of starting a chatbot deployment internally first, appealing, i.e. building a chatbot for B2E (business-to-employee) service first. Helping employees with IT requests (“I am locked out, need a new password”, “how do I integrate Salesforce with Outlook”), or with HR requests (“where can I get new business cards”, “can I take Monday next week off”.)

Starting internally delays the positive impact the technology can have on the consumer but lets a business learn about its potential and challenges in a relatively low-risk environment. “Start, but start small” is advice I have heard other vendors and technology innovators give, which I can only second.

Apple will dominate messaging in 2018

In my opinion, the most important event in 2017 was Apple’s “Business Chat” announcement at WWDC17 in April. The idea of messaging a business, vs. calling or emailing it, is still new to most consumers today, even though we’ve used Twitter for years to complain about brands and Facebook Messenger for the occasional customer service question (still a novelty for most.) However, according to some estimates, there are almost a billion iPhones in use today around the world. Add to that the fact that Apple has a track record of getting iOS updates through quickly, with 50% of phones estimated to have upgraded to iOS11 within only 4 weeks after release. Given these numbers, it isn’t hard to see how the immediate availability of the Message button embedded in search results in Siri, Maps, Safari, and Spotlight will catch the billion users’ eyes eventually, with a growing number of businesses opening up to accepting inquiries via messaging – a trend that started with the introduction of web chat. With this feature being released as we’re going into 2018, we should see a massive impact on the rising tide of “Conversational Commerce”, with the chatbot boats being lifted along with it.

Chatbots will break out of the silos any innovation starts in

With most emerging technologies, the first applications are usually built as silos, not integrated with existing infrastructure, which often results in suboptimal user experiences. In 2018, we should see much better integration with customer data and analytics, bringing customer history, behavioral patterns, and big data into chatbot interactions. We will also see more applications for customer engagement integrated with the enterprise contact center with chatbots and live agents working together to serve the customer. The result will be more personalized and productive interactions. Furthermore, while the early attempts at chatbots we saw in 2016 and in parts 2017 showed an astonishing lack of robustness, the industry is waking up to the importance of good UI/UX design, which results in a surge of demand for creative writers, designers, psychologists, and linguists. The next generation of chatbots will get much better at actually being “conversational” in nature, handling not only simple answers to frequently asked questions but also more advanced dialogs that will be transactional in nature. Academia responds with an effort to move from STEM to STEAM (advocating the addition of arts to the field of Science, Technology, Engineering, and Math.) – a move that is overdue in my mind.

For anyone trusting my judgment and pondering an entry into the exciting world of chatbots and other forms of artificial intelligence in the enterprise, I can only conclude by repeating what I stated before: start, start small if you want, but start now. Your competitors are doing it if they haven’t already, and so should you.

This blog was originally posted at http://blogs.aspect.com/state-bot-going-2018/