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  Technology   In Other news  14 May 2018  Understanding conversational commerce: What works and what doesn’t

Understanding conversational commerce: What works and what doesn’t

Published : May 14, 2018, 6:49 pm IST
Updated : May 14, 2018, 6:49 pm IST

And with messaging apps taking over as the primary form of communication, a new hybrid of retail and conversation is taking place.

For a recently coined term, the chatbot business is growing at a staggering 35 per cent CAGR and is estimated to be more than a billion dollars in aggregate revenue by 2024. (Representative image)
 For a recently coined term, the chatbot business is growing at a staggering 35 per cent CAGR and is estimated to be more than a billion dollars in aggregate revenue by 2024. (Representative image)

From the beginning of time, businesses have tried to sell things. The average customer today has more options than ever, for any given product on the market. As more products have started crowding up space, brands are continuously trying to make their customer experience as seamless as possible. And with messaging apps taking over as the primary form of communication, a new hybrid of retail and conversation is taking place: Conversational Commerce.

You’ve probably experienced it yourself. Aakrit Vaish, CEO and Co-founder of Haptik says that the term ‘Conversational Commerce’ was coined in 2015 by Chris Messina, in this Medium post. He defines it as utilising chat, messaging, or other natural language interfaces (i.e. voice) to interact with people, brands, or services that heretofore have had no real place in the bidirectional, asynchronous messaging context.


In easy terms, if you’ve ever spoken to a brand to buy a service or product through chat or voice, you’ve used #ConvComm. Conversational commerce is all about delivering convenience, personalisation, and decision support while people are on the go, with only partial attention to spare, according to Messina.

Ever seen the helpful little chat bubble on a website that pops up asking if you need help? That’s a chatbot. Alexa offering to book a cab ride for you? That’s a chatbot. And a chatbot that is transactional in any way enables Conversational Commerce.

For a recently coined term, the chatbot business is growing at a staggering 35 per cent CAGR and is estimated to be more than a billion dollars in aggregate revenue by 2024. That said, over the years, Haptik has experimented with several use cases and we ’ve found that there are some that are better suited to the medium than others. We’ve broken these down with examples from the market to illustrate each:             



If you’ve been on the Internet in 2017, you’ve probably heard of Alexa, Amazon’s smart personal assistant that lives inside the voice-controlled Echo speaker. The tagline for Alexa reads ‘The simplest way to shop. Just ask.'

Buying a product using the speaker is as simple as saying ‘Alexa, order a fruit basket’. You can re-order products based on your order history, receive recommendations from Amazon’s list of bestsellers and even get updates regarding the status of your order. Your voice is Alexa’s command, as the assistant handles the complete shopping pipeline for you.

Flight bookings

Travel bookings are another pain point that chatbots are good at solving as this example from Haptik’s Personal Assistant App shows. Booking flight tickets through Haptik can be accomplished within minutes. Simply type in ‘I want to fly from A to B on XYZ’ and you’re on your way, literally. The chatbot shows you a pre-filtered list of multiple options with the cheapest flights and best offers available. You can even set fare alerts to be notified about a price drop on a potential ticket and proactively sends you live updates about your flight status over chat. Web Check-In is another much-utilised feature which can be completed within a few chats with the virtual assistant.


Food Ordering

TacoBell, the fast-food chain serving Mexican-inspired fare, recently announced their foray into conversational commerce with the TacoBot. The chatbot lives within Slack, a team collaboration and communication tool and makes it easy for office-goers to place orders for a hurried lunch over chat. With the TacoBot, you can collate group orders, customise your burrito and place your order, all through the bot within minutes.

GIF Source:


Freecharge, India's second-largest mobile wallet company, recently came up with a feature on their app that allows you to transfer money to any contact on WhatsApp chat as an extension of their ‘Chat n Pay’ feature. Transferring funds is as easy as typing in the amount, followed by ‘FC’ in any WhatsApp conversation, and picking from the send, request or recharge options from the popup that appears. This social commerce initiative is all about making payments more engaging, convenient and secure for a wider audience of smartphone users.


What Works

-A chatbot can be built and deployed on most popular messaging platforms and can easily integrate brand promotions into conversations, reduce resolution time and improve the brand perception of a company.

-Conversational commerce brings back the ease of conversation and reactivity into e-commerce. This gives solitary shoppers a 24/7 companion that can handhold them through purchasing and provide immediate help any time of the day. Complicated and sensitive chats can even be handed off to a real human agent if the need arises.

-There’s an increased likelihood that a product is purchased because recommendations are personalised as per the users chat history and purchase history which generates genuine interest in a product.  Existing, available parameters like geolocation and language can easily be used to kick off a conversation on a personal level. This also applies to making quick payments as well as transactions since card and account details are already stored in the system.


-Customers can be followed up through personalised marketing messages which have more impact than other methods like video or email promotions.

-The modern customer is now accustomed to chatting as a conversational medium. It is specially optimised for phones and does not need the user to be redirected anywhere else.

 What Doesn’t Work

This brings us to the not-so-great side:

-Conversation AI technology hasn't progressed enough to understand the nuances of human speech and learns over time.  Users have high expectations from a conversational medium which can risk negative sentiment when they learn that a bot is limited in what it can do.


 -A chat experience can be time-consuming due to its conversational nature as opposed to a quick google search and user looking to quickly compare various shopping options and find the cheapest available, would not enjoy.

-For use cases which are open-ended, like shopping, the catalogue is extremely wide. Searching for ‘jeans’ can have multiple options based on colour, material, length, style and others. This does not translate well into a conversational medium because chatbots are best used for well-defined use cases that have straightforward solutions.


Chat based transactions can be expected to become a norm for more businesses as chatbots including voice bots start becoming commonplace across platforms. Bots in the future will be smarter at understanding and anticipate what you need, which will yield to higher turnover through conversational commerce.


Millenials are currently ageing into their prime spending years as members of the workforce and prefer using chat as opposed to other mediums. Every product you see will be easily purchasable right when you talk about it or simply mention that you’d be interested in a product.

A bot can hear you say ‘I feel sad’ and ask ‘Would you like dessert?’ and send a steaming waffle to your work desk within the hour. It isn’t a scene from an Asimov novel, it’s the magic of conversational commerce done right.

Tags: alexa, haptik, chatbot