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Why Mid-Market Companies Don't Use Chatbots

5 minute read
Kaya Ismail avatar
A recent study shows that mid-market companies are choosing to forgo the opportunities and benefits linked to customer-facing and employee-facing chatbots.

The chatbot landscape is burgeoning — for the most part. According to Opus Research, it is expected that by 2021 enterprises will invest $4.5 billion in chatbot technology, and yet, according to a recent study by Think Relay, not everybody is on board.

Explaining The Mid-Market Gap in Chatbot Adoption

The study by Think Relay analyzed 20,000 websites that were using chatbots and conducted additional analysis of 1,000 top tech companies from Crunchbase. There were some noteworthy findings concerning the size of companies deploying chatbots — and the size of those companies passing on the opportunity.  

The study found firms that had between 1 and 50 employees “made up the bulk” of those utilizing chatbots, with approximately 71 percent of the sample. From this, it is plausible to conclude smaller companies are tempted to use chatbots due to the convenience and efficiency it provides in comparison to having full-time staff.

And while the sample will have more companies with 1-50 employees than enterprises with more than 1,000 employees, Think Relay expected that the distribution of chatbots would follow a linear model with the enterprise firms making up the smallest percentage of firms using chatbot technology.

However, the study revealed that mid-market companies, those with 250 to 1,000 employees are the least represented when it comes to using chatbots, making up 3.6 percent.

chatbot adoption graph

Source: Think Relay

Related Article: How Much Does It Cost To Build an Enterprise Chatbot?

Why Does This Mid-Market Gap Exist in Chatbot Adoption?

When we spoke with Lucy Dilworth, marketing associate at Vee24, explained why mid-market brands are not willing to take advantage of chatbot technology. “Depending on the size of the company, implementing chatbots may not be within their business plan. [Mid-market] companies may feel that they have an adequate amount of resources and live workforce to handle their current volume,” Dilworth said.

Dilworth added that many mid-market firms feel that their customers may become reluctant to “proactively engage” with chatbots. “Larger institutions understand that customers feel more comfortable when speaking with a live person regarding personal matters, such as finances, shipping and credits,” said Dilworth. “In addition to the customers' hesitation around AI, deploying chatbots in companies with 250-1,000 employees is much more time consuming than doing so for companies with 50-250 employees.”

This viewpoint is also shared by Steven Eschweiler, COO at Hivelocity. Eschweiler sees his firm as a mid-market company, and they provide 24/7 live chat to their customers using only human agents. “If you are a mid-market company using a chatbot then you have just eliminated two of the very best reasons for someone to choose your company over one of your giant competitors: superior customer service and personal attention.”

Learning Opportunities

Sean Spicer, marketing manager at Agile IT, said most mid-market companies don’t use chatbots because most chatbot providers do not meet their needs. “Mid-market companies aren’t using chatbots because mid-market chatbots are terrible,” Spicer said. “Most chatbots are built on simple if-then logic or even worse are simply talkative forms to collect information for a sales team.”

Spicer also added that since chatbots act as the first point of contact for their customers, a poorly performing chatbot could damage the overall customer experience. “Often, chatbots are the first interaction a site visitor will have with your brand, and when they (the chatbots) act like idiots, you immediately lose the respect of the company.”

Related Article: Top 14 Chatbot Building Platforms

How Should Mid-Market Brands Approach Adopting Chatbots?

Joerg Habermeier, head of product at UJET, said there are a “real” challenges for companies looking to deploy a chatbot that:

  1. Can automate important business process flows.
  2. Are designed to ensure a positive end-user experience.
  3. Seamlessly integrate into a contact center experience.
  4. Can be readily monitored and maintained.

“Given the mixed results of some chatbot offerings, a wide range of service offerings to select from, and often, typically the associated lack of experience, it is not surprising that many companies remain on the sidelines,” Habermeier said.

However, Habermeier advised that mid-market brands can take a number of different approaches towards adopting chatbots and begin to leverage the advantages of automated efficiency and optimization that chatbots provide.

One approach that Habermeier advised of is to assess current business processes that are leveraged by end-users. In doing so, brands can “enable automated, curated self-service flows and make them available for chat,” said Habermeier. Machine learning and AI are not needed as you will be utilizing tracking technologies to learn about your consumers and identify common requests that can be automated with a chatbot. This data can then be utilized by AI and machine learning at a later time.

Another approach is to work with a business partner that can provide guidance and assists with the initial setup. “Work with a business partner that can offer intelligent automation as an integrated experience and can provide direct guidance for both assessing appropriate areas for automation and helping get the initial implementation set up, as well as offering a path towards including AI and machine learning for interaction areas where they will be most impactful,” Habermeier said.