The document discusses the rise of conversational commerce powered by bots. It predicts that by 2020, bots will facilitate 40% of mobile interactions and transactions as the post-app era begins. Several companies like Microsoft, Facebook, and Slack are shifting their focus to bots and chat-based platforms. Bots allow brands to have intuitive, intelligent, and contextual conversations with billions of users on messaging platforms. This shifts business operations to a new model of conversational commerce where micro-moments can be tapped into through bots.

1. COLUMN
By Sairam Vedam
The BOTTheory
Has the time come to say goodbye
to apps?
Gartner report on ‘top predictions for 2016 and
beyond’ says that, by 2020, autonom ous software
agents outside o f hu m an control will participate in
5% o f all econom ic transactions. T he sam e report
goes on to predict that by 2020, sm art agents will
facilitate 40% o f m obile interactions, and the post-
app era will begin to dom inate.
T his phenom enon in the technology industry
across the world confirm that we are at the
m om ent o f inflection. M arketers and brands both
needs to be wary of:
■ On M arch 31 2016, Satya Nadella, M icrosoft
CEO, com m unicated that conversation as a
platform is the future.
■ O n April 12 2016, Facebook announced a new
m ech an ism for brands to build their own
chatbots for Facebook M essenger. O ne o f the
ideas is to turn M essenger into an e-com m erce
hub, w here people can buy things directly from
bots m ade by big brands. M ark Zuckerberg,
Facebook CEO, disclosed that he was routinely
using ‘bots’ - sm art software applications - on
Facebook M essenger.
■ Slack, a next generation chat software company,
intends to ease the way users connect in an
enterprise. It announced U SD 80 m illion fund
to invest in startups that build software that
integrates with Slack. It also launched the Slack
App Directory, a catalog o f 150 chat bots and
Slack integrations.
■ O n New Year’s Eve o f 2016, 8.08 billion ‘red
envelopes’ (a bot to transfer m oney virtually)
w ere sen t via W eChat, w hereas PayPal
processed 'a m ere’ 4.9 billion transactions in
the entire year 2015.
W hile these indicate the shift from an appworld
to the bot world, what it m eans to the world of
digital and com m erce is m ore interesting. Business
in the digital world has now a new fulcrum o f
operations called Conversational Com m erce.
Why is this shift happening?
W orld over, a total o f 3 billion people are chatting
across different m essengers from W hatsApp to
W echat and Line.
Im agine the reach for brands if all these users
interactively, instantly and intelligently converse
ju st like they would do on the shop floor. Today
that is a reality. W elcom e to conversational
com m erce, powered by bots.
Historically, idea o f chatterbots/chatbots/bots
is not new. In fact, it has its fam ous origins to the
Alan Turing days itself.
W ikipedia says, “a chatterbot (also known
as a talkbot, chatbot, Bot, chatterbox, Artificial
Conversational Entity) is a com puter program
w hich conducts a conversation via auditory
or textual m ethods. Such program s are often
24 CIO&LEADER O ctober 2016

2. designed to convincingly sim ulate
how a hum an would behave as a
conversational partner, thereby passing
the Turing test.’’
Bots are the new Apps!
OS is not the new platform anym ore.
The m obileOS+App com bination has
already becom e redundant. T he reason
is the num ber o f apps that an average
user wants, uses and sticks has
becom e lim ited. In addition to this,
the apps have no universal interface
that can be consistent throughout the
user demography.
But, bots can be sim ple and constant
considering it is built on a sim ple and
com mon m essenger platform that can
look alike to all the billion users there.
However, there are six conversational
aspects Bots can enable for your brands:
■ Conversations are hum an: They are
instant and emotional. Bots can exactly
replicate that. Window o f possibility for
an user to make a decision, get a query
answered, switch to a better option - all
happens in the sam e instance - bots
can enhance brands ability to achieve
consum er stickiness
■ Conversations are interlinked: They
are instant and em otional. Bots
can exactly replicate that. W indow
o f possibility for an user to m ake
a decision, get a query answered,
sw itch to a better option - all
happens in the sam e instan ce - bots
can enhan ce brands ability to achieve
con su m er stickiness
■ Conversations are intuitive: Smart
agents popup to ensure you have an
advice, suggestion and a friendly face
(smiley) - bots can ensure brands
becom e friends
■ Conversations are intelligent: M achine
learning helps bots to replicate
intelligent conversations - bots can
make brands becom e more predictive
■ Conversations are inherently social:
-• Conversations by nature tap into
collective intelligence that can
influence buying patterns. Bots can
leverage A1 to ensure crowd sourced
buying happens. T his increases
brand virality.
■ Conversations can be contextual:
W hat you discuss with a friend could
be different from what you would
with a stranger. W hat you would
ask could be m ighty different from
what you wotdd share. Bots can
enable privileged conversations.
W hile you want to have different
levels o f conversations with different
privileges, a friend bot could be
different from an inform ative bot.
Bot first strategy - Websites
might be dead
T h ere m igh t be a day very soon w here
bu sin esses, sm all/big, will be able
to open a m essen g er account than a
w ebsite. Becau se a sim ple m essen ger
account integrated with bot can give
you instan t access to billions o f users
at one go. It is already happening on
W eChat in China
Four platforms to watch out
for in the Bot world
Siri, Cortana, Echo and Google. All
the four have th eir un iqu e offerings
that can take charge o f your personal
life to the living room to your
shopping, travel and a lot m ore.
They are tran sform in g them selves to
platform s allow ing their A PIs to be
extended and m o st im portantly they
can do both text and speech.
Conversational com m erce is about
m icrom om ents- Are your bots in place
to tap into them ?
According to Forrester, the world
o f custom er experience is all about
personalization. H ence, a tectonic shift
is happening. Since conversations
can be spawned and ended in a
split second, the ability to tap into
the m icrom om en t w hen a hum an
typically converses is very im portant.
It is a huge and untapped m arket
opportunity for brands. Today’s
m achine learning allows these
m icrom om en ts to be captured.
Conversational com m erce is about
instant conversion- D efine your bot
strategy and Act on it, now. ■
— The author is VP e[ Global Head -
Marketing ,Cigniti Technologies.
CIO&LEADER O ctober 2016 25