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5 Reasons to Love Automated Virtual Agents

By Alex Lebrun CRM Buyer ECT News Network
Jun 11, 2010 5:00 AM PT

Do you want to close more sales? Do you want to sell more to existing customers? Do you want to get closer to your users online so you can know what they are thinking? A virtual agent could be an effective way for you to do all of the above.

5 Reasons to Love Automated Virtual Agents

What is a virtual agent? Technically, a virtual agent is a piece of technology that interacts with customers via natural dialog and assists them in whatever they are attempting to do with a company. Some might call it an artificial intelligent, non-human representative that can interact with users to answer their questions and guide them through processes on a website or smartphone. However, conceptually, virtual agents are a means by which to automate interaction with customers. You take your organization's expertise at selling/service and "teach" this to the virtual agent so it can assist your customers faster and more efficiently than a human.

Virtual Scenario

Let's consider a simple scenario. A company places a virtual agent on its website with a professional and friendly-looking avatar as its "representative." The virtual agent can proactively communicate with a back-end system to determine which product/service should be promoted to this customer. The virtual agent then either pops up proactively or passively promotes the product/service on the side of the page. The user can then ask questions of the virtual agent, such as "what would my rate be?" or "how much would an additional license cost me?" or maybe something as simple as "tell me more."

The virtual agent can then engage the user in conversation, take the user to specific Web pages, display images or guide the user through an application process, all depending on what is required for the sales process. The virtual agent can then close the transaction with the user or pass them to a live-chat human support person ... all done while interacting with the customer in text natural language.

Is it possible that virtual agents could assist customers today? Is this science fiction? No, companies today around the globe are automating interactions with customers via virtual agents. Approximately 100 of the Fortune 1,000 already have virtual agents. Companies like eBay, H&R Block, Michelin, L'Oreal, Alaska Airlines and Philips are using virtual agents to engage with users' and improve their entire experience.

Interaction, Self-Reliance, Speed

Here are five reasons why virtual agents improve customer experience:

  1. More Interaction Equates to More Sales: Companies spend an amazing amount of resources creating content and getting prospects/customers to look at their websites. The general rule is that the more you can get a customer to interact with you, the more you will be able to sell them. If this is not the case, and the more they get to know you, the less likely they will buy, then you have bigger problems that a virtual agent can't solve. However, if you find more interaction with customers correlates to more sales, as with 99 percent of companies who sell, then virtual agents offer an engaging channel to interact with users -- either proactively or by allowing customers to choose to interact with the virtual agent on their own.
  2. Users Want to Be Self-Reliant: On your website you can offer a phone number or live-chat or email, but the bottom line is, users want to be self-reliant. In fact, a recent report from Forrester Research titled "It's Time to Give Virtual Agents Another Look" indicated that "... only 28 percent of U.S. online consumers prefer to contact companies via telephone or email rather than using a company's Web site to get answers to their questions." Customers would prefer to take care of themselves, especially younger customers. Virtual agents provide a channel that allows customers to get answers to their specific sales and service questions without necessarily having to talk to a human. This gives the user the self-reliance of self-service along with the option of speaking with a human if the need arises.
  3. No Limit to Interaction: Ultimately there are limitations placed on many channels of proactive customer interaction, such as the phone or live chat. Even if you wanted to engage with customers via these channels, there are limits to the number of people available and/or limits imposed by the cost of these channels. You aren't going to turn to pop-up live chat that will cost you US$5 if your average profit per transaction is $4 (some people might say you can make it up in volume, but those individuals work for the U.S. Federal Budget Department). There is no limit to the number of virtual agents that can be spawned for customers to assist them. Also, the cost per interaction with customers is so low and cost-effective that one could interact with them using virtual agents for any type of product/service.
  4. Speed-of-Light User Experience: Being a piece of technology, a virtual agent can operate at the speed of light. Thus, it can do things much more efficiently/effectively than a human and create a superior user experience. In the time it would take for a human sales or service person to say hello to a customer, a virtual agent could look up a user's account, determine the products to offer them based on the relationship they have with the company, determine the pricing structure for the customer, evaluate the business rules to apply to the given situation and bring the customer to a specific Web page where it could highlight a given part of the page. This ability to guide customers and rapidly answer their questions creates a superior user experience that builds confidence in customers and leads to more sales.
  5. Real Voice of the Customer: There's no better way to understand the needs and issues of a customer than having conversations with them. By interacting with customers with a dialog they can express exactly what is on their minds. Using a virtual agent enables a company to capture real conversations with customers, rather than just keywords or clicks on links. Analytics wrapped around this type of direct input from users provides a powerful way to gain insight on how you might improve your website, streamline your business processes with customers and decide what types of marketing campaigns you might want to introduce to service part of your market.

Virtual agents are quickly growing in popularity, and it is very likely that by the end of the decade all major websites will have some type of virtual agent solution to proactively assist and sell customers. Approximately 10 percent of the Fortune 1,000 already have them. The era of customers searching for their own answers to their questions will wane as companies proactively step forward to guide customers, both in sales and service. Today many companies differentiate themselves by the quality of their sales and service personnel. Soon companies will also be judged by how well their Web "robots" sell and service users ... based on the needs of those customers. The future is here now!


Alex Lebrun is founder and CEO of VirtuOz.


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