Messaging platforms are now the bedrock of consumer engagement with brands – and it has created a boom in conversational commerce. Paul Skeldon takes a look at how AI-powered conversational everything is now the watch word for business and what it means for telemedia
The surge in use of messaging technologies – SMS, WhatsApp, social DMs and, increasingly, RCS to name but a few – has had a profound impact on modern business. In 2020, when the pandemic struck, most businesses had never even considered that they would talk to their customers and prospects via WhatsApp or Instagram. Outside of a few leading retailers and brands, the good old-fashioned ways of using email and phone calls worked just fine.
Only it didn’t. The stress to the system from the rapid change in consumer habits wrought by the pandemic showed just how out of date these modes of communication were – certainly in the minds of mobile-first consumers.
Thankfully, three years on and the landscape for business comms has changed radically. Now interactions over WhatsApp are as routine as via SMS, more so in many ways, while most businesses have built social DM messaging into their communications strategy.
And this has created a whole new way of doing business. Now, communication underpins the start, presence and future of many customer interactions. Welcome to the era of ‘conversational everything’.
Growing use of messaging
According to data from Infobip, there has been a 73% and 51% increase in WhatsApp Business Platform and Email interactions in 2022 compared to 2021, highlighting the ongoing critical nature of these channels. Meanwhile Google Business Messages and Apple Messages for Business interactions increased by 186% and 232%.
For customer engagement, WhatsApp Business Platform, voice and mobile app messaging saw the highest growth in 2022. Since the introduction of marketing messages over WhatsApp Business Platform, customer engagement and promotional usage increased interactions on the channel by 2.5 times.
Meanwhile, voice and mobile app messaging increased by 191% and 92%, demonstrating how customers now prefer instant, rich, and human-like experiences with a business or brand.
Despite this, operator messaging traffic also continues to grow and expand, as SMS still offers an excellent channel for conversational interactions, even if it isn’t yet transactional.
According to the latest data from Juniper Research, operator business messaging traffic is set to reach a whopping 2.8 trillion messages by 2027; rising from an already impressive 1.9 trillion in 2023 – driven surprisingly by RCS.
Interestingly, much of the rise in SMS traffic is down to OTPs in two-factor authentication process, traffic which may yet be heavily eroded as the GSMA’s Open Gateway programme is rolled out. However, with the desire for communication across all mobile channels riding high, there is still enough growing use by businesses not yet using even SMS that this slack may yet be taken up.
Further research by Infobip, finds that only around a quarter (28%) of UK organisations have omnichannel connected their organisations, yet more than 60% of UK organisations see the value in connected communication channels, new data shows.
The research, carried out for Infobip by research company IDG, polled 215 organisations spanning retail and ecommerce, transport and logistics, telecommunications, financial and insurance and public sector industries.
The aim was to assess the integration of digital channels and how connected they are across differing departments within an organisation and how this informs the customer experience.
The results also find that there is a slower adoption of newer digital messaging apps, with three-quarters (76%) of businesses using email and 59% using SMS. Only 7% of UK businesses are using digital messaging apps.
Next year, however, this figure is set to double (14%). Evidently, there is still much room for growth in how even simple things such as SMS are used by businesses.
And it is not just in the UK. While this data points to that particular market, the situation is replicated across the world.
With consumers everywhere wanting a more conversational interaction with brands and businesses, the opportunities in messaging continue to be immense.
AI gets chatty
However, the rise in interactions between consumers and businesses and vice versa naturally is a double-edged sword. Yes, more contact means more sales, but it can also mean more problems.
The more conversations and interactions consumers have with a brand means that there will, inevitably, be more complaints, problems and need for more comms. Handling this alongside the rise in active conversational commerce is something that businesses often overlook.
Here the same tools need to also be deployed to handle the second level of interaction, fielding FAQs, handling lost orders, tackling general complaints and so on. This a where everything from SMS to ChatGPT again has an ideal home.
These technologies that are used to enhance the initial conversation – from marketing outreach to closing the sale – are also a vital part of on-going customer service.
Here AI can probably handle more of what is happening than it can in the initial phase. Many FAQs, for example, are readily addressable by automation. Follow up emails and marketing too has a natural bedfellow in generative AI.
AI is also likely to play a role in deciding how best to handle all and any calls, intelligently routing what needs to go where based on what people say – and indeed what mood they sound to be in.
Good news for telemedia
All this talk of conversational commerce (see what I did there?) is all good news for telemedia. Many of the messages and platforms are being run by telemedia companies and these guys have the pedigree of being early adopters of new tech.
It creates a tantalising market for telemedia that takes CPaaS, messaging, marketing and even good old contact centre tech to a whole new place. I look forward to seeing how they actually integrate ChatGPT et al into their offerings before the Summer is out.
The industry is also set to benefit from the increased online sales that conversational commerce brings.
One of the chief beneficiaries will be carrier billing. Data suggests that it is now set to be a $122bn global business in just five year’s time. It is already a $70bn one now. I remember when we hoped that it might make it to the $1bn mark just a few short years ago.
What is interesting about this surge in use of DCB is that it is no longer confined just to content. It is seen across gaming and music too.
But more interesting still is that it is also starting to garner significant interest in the sale of physical goods and ticketing services.
Imagine what customer experience powered by AI delivered via CPaaS and backed by easy-to-use carrier billing can deliver for conversational commerce?
And it will happen. I strongly expect that, by the time we get to World Telemedia in Marbella in October, someone will have rolled out something along these lines.