Originally published in Rapaport Magazine by Lara Ewen
Online sales changed brick-and-mortar retail not just in terms of the bottom line, but also in the way store owners and customers interact. A 2017 Hubspot survey showed that 48% of consumers would rather connect with a company via live chat than through any other means. The same survey found that 40% of consumers don’t even care whether the help they’re receiving is human or automated, as long as they’re being helped. As clients demand 24/7 customer service, retailers struggle to nd ways to accommodate them. One possible solution is chatbots.
“A chatbot is a computer program that is used to simulate a realistic and natural human conversation over the internet,” says Mike Kim, director and head of the Center of Data Excellence at AArete, a global consultancy specializing in data-informed performance improvement. “The typical use of a chatbot is to answer questions or provide context on specific questions the user may want to know.”
Fortunately for jewelers, the earliest stages of a consumer’s diamond-buying journey involve research and education.
“Explanation of things like cut, clarity, color, imperfections, ratings can all be done through a chatbot,” says Sam Cinquegrani, CEO and founder of Chicago-based ObjectWave Corp., which provides digital-commerce solutions. “Chatbots can be a way to educate consumers about a diamond.”
Then there’s the millennial factor. “People in the diamond industry are having a bad time,” says Arik Marmorstein, cofounder of BlingChat. Marmorstein’s Facebook Messenger-based chatbot is designed
to help consumers source wedding-related items, including engagement rings. “Everyone is trying to see what millennials are going to do. Well, millennials are going to keep getting married, but they spend a lot of time researching and chatting. So we created BlingChat to cater to millennials.” He says his average user spends more than eight minutes using the chatbot.
The technology is particularly good in the early stages of a purchasing journey, or during very busy times of the year. “Chatbots can provide speed and scale to answer consumer demand on grievances, typical questions or speci c questions on context related to jewelry,” says Kim. “From an operations perspective, this can help for peak demand periods during the holidays.”
There are still challenges, though. Chatbots’ rote answers can be problematic, according to Cinquegrani. “A response from a chatbot is typical, ubiquitous and not personalized,” he says. “In other words, it’s a generic response. To succeed, it needs to react personally to the individual. Otherwise, the technology can be annoying and not well-received.”
Kim agrees: “New chatbot technology for a niche industry like jewelry may not capture nuance or subtext related to speci c consumer demands. These models may take time to learn from consumer data to craft natural language for future use.” Even so, these automated sales reps could change the retail game, for better or worse.
“The same thing that happened in 2008 with mobile apps is happening now with chatbots,” says Marmorstein. “And having a chatbot shows your clients who you cater to. It shows millennials that you’re one of them.”