Artificial intelligence. You have probably heard about it a lot, what with it being depicted in popular media in so many different ways. Some see it as the future, while some — for good measure — approach it with some trepidation. But why?

The most popular example of artificial intelligence in use today comes in the form of voice assistants like Siri, Google Alexa, and Microsoft’s Cortana. They allow everyday consumers to interact with their devices and the wider world easier; some examples of its use can be for sending text messages, setting alarms, and even placing orders using voice commands.

There’s another use of artificial intelligence that not a lot of people are accustomed to yet but is slowly growing in popularity: automation. But more specifically chatbots. What are chatbots? In this article we will be going over what this branch of artificial intelligence is used for and how it has affected Asian markets today.

A definition of chatbots

Chatbots are a subset of artificial intelligence that is considered by some as the most simplest form of AI. This software is designed to imitate human conversation, thereby automating simpler fact-finding processes in the customer service journey.

Its history dates to the 1960s when an MIT professor by the name of Joseph Weizenbaum designed the first ever chatbot he named ELIZA. This first version of the technology recognized key words and phrases and matches it with pre-set responses. This created an illusion of human consciousness, and paved the way for future versions of AI.

Usage of Chatbots

A chatbot relies on Natural Language Processing, Speech-to-Text, and Machine Learning. The combination of all these technologies allow a chatbot to process, understand, and respond to human input.

How it works is, theory, a chatbot can watch for keywords and give the closest and most appropriate response. What this does is it takes the initial, fact-finding step in the customer journey and automates it to save time. From a customer service perspective, this is gold!

Instead of having a live agent handle reception and basic data gathering, a chatbot can take its place and create what we in the customer service industry refer to as a call deflection. This is achieved when an inquiry is handled by non-voice means, usually by offering alternative (often self-service) solutions. More on this later.

Chatbots in Asian Contact Centers

Though artificial intelligence is a newer trend in the customer service industry, there’s one continent that has embraced it wholeheartedly: Asia. It did so to the point where one company even fully revamped their operation to run on chatbots instead of human agents.

AirAsia first unveiled their version of an advanced chatbot named AVA (AirAsia Virtual Allstar) in January of 2019. This version of a chatbot is designed to offer alternative ways for customers to browse and interact with their website. AVA is a live chat feature that responds to clients instantly in eight languages including English, Bahasa Malaysia, Thai, Vietnamese, Korean, and Traditional Chinese.

By having real-time support solutions like a chatbot, you are paving the way for an easier and more streamlined customer journey. A chatbot can answer simple queries faster while directing clients to the next level of the sales process with more accurate information. Doing so shortens the service process while enhancing the chances of an actual sale happening.

Important statistics about chatbot

The value of conversational AI went up significantly during the Covid-19 Pandemic, what with companies having to rely on them when the workforce was at its limit.

Here are some important numbers regarding conversational AI that we should be focusing on:

Asia leading chatbot adaption

According to a report conducted by the International Data Corporation, they fond that as of 2022 the spending budget on conversational AI models will reach in $77.6 billion. This includes research, application, and other modes of spending in relation to chatbots. This number is said to be triple that of the 2018 projection which was slated at $24 billion.

It’s no surprise that Japan, Singapore, and China are leading the way for artificial intelligence adoption. According to a survey conducted by McKinsey Global in 2020, they have found that a whopping 50% of respondents say that their companies are open to using AI. This has only grown more in 2022, and with no end in sight.

Major Industries where AI is leading the way

The USA and China are some of the top countries who are openly advocating for the use of conversational AI. And though Southeast Asia is lagging behind these two behemoths, progress there is showing. There are technologies being developed there that are indicating that a full-blown adaption of chatbots lie somewhere in the horizon.

In countries that have shown significant usage of this technology, it is found that they are mostly utilized in the following industries:

• Finance
• Travel and Tourism
• Education
• Retail
• Healthcare and education

Chatbots improved efficiency during the Pandemic

According to Forrester, a research firm that specializes in business and technological developments, they have observed the following:

• “Chatbots (32%) were the most effective in resolving customer queries quickly followed by smart self-service (28%), virtual assistants (23%), and speech-enabled virtual assistants (8%).”
• “Only 17% of firms said that automation lowered turnaround time and time-to-response, while 8% said automation improved customer satisfaction score (CSAT) and net promoter score (NPS).”

These two observations highlight the clear benefits of automation that any contact center should be focusing on. However, there’s also the matter of how a chatbot can affect the overall customer experience if now done right:

• “80% said chatbots produced more negative experience than positive or neutral ones during the pandemic while virtual assistants (75%) and speech-enabled virtual assistants (70%) also led to poor customer experience.”

The effects of conversational AI on the e-commerce landscape

The things that most consumers found to be infuriating about shopping online are the long wait/hold times, having to deal with rude agents, and the miscommunication that tends to happen when communicating with someone remotely. All these are remedied by chatbots, apparently. In a 2022 research conducted by Tidio, they found that 62% of their respondents said they would rather deal with a chatbot if the alternative was having to wait on a live agent.

During the pandemic, a huge boost in sales were noticed when certain companies adopted conversational AI into their customer service operations. Though this just might be pure coincidence — what with people having no other option other than online retail — the boost in customer satisfaction ratings say otherwise.

Such is the case with Elkjøp, a consumer electronics retailer based in Sweden, Denmark, and Finland. They report that chatbots allowed them to extend their operating hours, gave them more flexibility, and enhanced engagement between them and their customers. They also reported that their consumers gave a remarkable 80% approval of their choice to adopt chatbots.

The effectivity of chatbots and conversational AI

For brands who are hoping to extend their reach, deploying AI chatbots is a great solution. They offer distinct advantages like extended operational hours, multilingual support, and seamless integration at more than half the cost of having a team of customer service agents.

But where is it at right now in Southeast Asia? In terms of adoption and implementation, countries like Singapore, Malaysia, and the Philippines are showing signs of massive potential for growth. It is undeniable that these countries are some of the biggest hubs for customer service operations from the United States and other European nations, and an adoption of all major technologies that could benefit the industry is but a matter of time.

The future of chatbots in Asia