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Chatbots vs. The Human Touch: Which Will Win?

A Snarketing post by Ron Shevlin

There’s no denying that bots are hot. One tech entrepreneur recently said:

“Messaging apps are the platforms of the future and bots will be how users access all sorts of services.”

Of course, that quote came from a publication called Chatbots Magazine, so we might not be talking about an unbiased source. But I’m not here to argue for- or against that view. What I want to do is raise the point that there’s an opposing viewpoint — one that centers on the importance of the human touch.

The title of an article on the Wharton School of Business site asks “does talking to a human still matter?” The article contains the requisite “I-had-a-bad-interaction-with-a-chatbot” annecdote about a negative experience with a bot, and a quote from a marketing professor who apparently argues for human intervention when he said:

“When a human is in the interaction, there’s an opportunity to course-correct, and that’s less the case with chatbots.”

Hmm… I’m not sure about that.

A colleague of mine told me his”bad bot” story yesterday. He and his wife purchased something online, but then realized that they had some questions that would impact whether or not they really wanted the product. She went online and opened up a chat window, thinking that she would be chatting with a live human. The chatbot even started the conversation by asking her how she was doing this evening.

After more than 20 minutes of being nowhere closer to getting an answer to her questions, she realized it was a chatbot, and not a human, and bailed out of the chat. She then called customer service, and got hold of a real live human being… who told her the order couldn’t be canceled because it was now more than 30 minutes since the order was placed.

Confusion With Confusing Convenience and the Personal Touch

In another article, Pymnts.com concluded “in the digital banking age, the personal touch still matters.” The article quotes another tech exec who said:

“The personal touch should be just that — personal. It may be true that digital banking platforms are more efficient than the traditional, in-person banking relationship, and that consumers may value the convenience of technology, but you still can’t confuse personal touch with convenience.”

I’ve read that last sentence at least ten times now, and for the life of me can’t make sense of it.  Who confuses personal touch with convenience? Wouldn’t it be the other way around? Isn’t it more likely that there are people who are confusing convenience with the personal touch?

Veriday | Digital Agent

Hello? IVR?

There are a couple of things about the two articles that bother me. First of all, on both sites, the authors of the articles weren’t mentioned by name. So how’s THAT for personal touch?

Second, from reading the articles, you’d think that neither author had ever heard of, or has ever had to deal with, interactive voice response (IVR) technology.

Airlines, telcos, and yes, financial services firms do everything in their power when you call them to keep you from actually talking to a live human being.  So if you’re going to criticize chatbot technology for not providing a personal touch, you might want to start by bashing IVR technology.

The Chatbot/Personal Touch Paradox

There’s another paradox buried in this chatbot discussion. Nearly every bank and credit union CEO says that “people” are their organization’s competitive advantage. But if chatbot technology is as good as its proponents say it is or will be, then “your people” is not a sustainable competitive advantage.

Bank and credit union CEOs don’t think digital channels and interactions are unimportant, but what many do think is that interactions that happen in digital channels are less important than human interactions.

This is a dangerous and flawed perspective. In the banking world of the future — whether it’s the short term future or the long term future — where the quality of digital interactions is more consistent, more efficient, produces more data, and is just quite possibly superior in every way to human interactions, your “people” are hardly your competitive advantage.

The only way you’re going to survive in that environment with that belief is if you manage to acquire all the customers who don’t want any part of digital interactions. Good luck with that strategy.

Chatbots Versus the So-Called Personal Touch

The “personal touch” argument misses the real crux of the matter. There may very well be people who only want to interact with people, or who prefer to interact with people. But I would argue that what most people want is their problem fixed, their issue resolved, and their question answered. And I would argue that they will go to whichever option is most convenient/most effective.

Please note that “most convenient/most effective” is not a single factor, but two separate ones.

In my colleague’s case, online was most convenient, but not most effective. The 2nd most convenient option — the phone call (with the so-called “personal touch”) — didn’t actually prove to be any more effective, however.

The third most convenient option — in this case, the least convenient option — was to drag their butts out the door, go to the store, and deal with a store employee. I don’t know if they did this or not, so I can’t say if turned to be the most effective option.

Chatbots may have their problems today. But chatbots will win if convenience and effectiveness are used as the evaluation criteria.

Ron ShevlinRon Shevlin is Director of Research at Cornerstone Advisors. Get a copy of his best-selling book, Smarter Bank: Why Money Management is More Important Than Money Movement. And don't forget to follow him on Twitter at @rshevlin.

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Comments

  1. A tone-deaf live operator reading from a script is worse than a chatbot. I don’t know why people who point out the limitations of chatbot forget that such live operators constitute the majority with many service providers these days.

  2. Ketharaman: Agreed. Here’s the thing, though: If I have an interaction with a bot, and I’m not satisfied with the result, I will try to escalate it to a human. If I get nowhere with the human, I’ll try to get to his/her superior. At some point, assuming I don’t get what I want, I have to give up.

    In a world where chatbots are completely replacing the human touch, will we give up after the bot interaction, or no?

  3. @RonS: No. Most probably, we’ll seek out some human to escalate to. I personally do that via social media and I’ve found it very effective (http://gtm360.com/blog/2016/10/28/why-are-reviews-so-powerful-in-social-media-customer-service/). I understand from some of my customers in the insurance industry that customer missives to brands fall into 3 categories: Queries, Requests, Complaints. IMO, chatbots will replace humans in Q; they may do that for R; they won’t do that for C. I think chatbots will be tasked to do things where escalations won’t happen as a norm.

  4. Banks people will still be their competitive advantage. Someone has to programme the chatbot after all. It’s just fewer, more highly skilled people – and these are the ones who are harder to attract, and harder to hold on to.

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