Chatbots have been around for a while now – helping us navigate websites, providing customer service and generally, when they aren’t too clunky, improving user experience. Then why are still so many companies reluctant to incorporate chatbots and AI to their customer services?
A Silicon Valley-based VC believes they should take a cue from the fintech industry, which was an early adopter and has seen great results. “Especially when it comes to AI, paired with chatbots, it makes a huge impact”, Zach DeWitt, a partner at Wing VC told The Fintech Times. “It’s a great combo, chatbots, AI and fintech, because fintech is a data rich industry where AI and bots really help sort out all that data for the customers and the company,” DeWitt added.
Wing VC knows their stuff when it comes to AI and chatbots. They have helped many Silicon Valley fintechs working with AI achieve series A and have learned a few things along the way. One of them is that user experience is the main key to success. “In the next ten years, a great user experience is what’s going to make or break a company. And in fintech, that is especially true, because you’re dealing with an extremely sensitive issue; people’s money. Having a great AI chatbot is a fundamental part of this user experience. The more comfortable the user feels with the bot, the more functional it is, the less they’ll want to talk to a human agent.”
One company that has a great AI chatbot experience, according to DeWitt is Lemonade, a New York-based online insurance company. Lemonade’s bot can follow up on claims, questions and handle FAQ seamlessly while pulling up a client’s information in a matter of seconds. In fact, Lemonade claims it takes its chatbots only 3 seconds to pull client information – a feat in itself, even by Silicon Valley standards.
Of course, Silicon Valley fintechs and many other US-based companies are already familiar with AI chatbots. “Silicon Valley especially is usually a decade ahead of other parts of the world when it comes to tech. I firmly believe that the future for fintechs is user experience with chatbots – and over here, we are already a decade ahead in that sense,” DeWitt said.
Case study: Mav, an AI assistant for fintech customer acquisition based in LA
Mav launched four years ago to help fintechs integrate with CRMs, allow users to have two-way conversations on text messages and help customers follow up with leads. Hillary Black, Mav’s co-founder, agrees that user experience is at the core of what they do. “Because we deal for example, with insurance, making people’s lives easier and making the process less confusing is what makes the difference between having and not having a chatbot,” Black told The Fintech Times. “It’s about the user experience, they want to achieve a goal and if they do it successfully and without friction, then they don’t care if it had to be through a chatbot.”
Mav also uses Facebook chatbots and SMS to help its customers reach out to users. “In the US, Whatsapp is not that popular for that purpose and with text messages for fintechs, we have a 98 per cent opening rate, compared to the 20 per cent that emails have.”
According to Forbes, texting a prospect after initial contact increases conversion rates by 112.6%. And this is a trend that is only growing after covid, with users getting more used to interacting online and via messages. “Definitely, there was a growth during covid, even though every year before we were seeing more user adoption too,” Black said.
Case study: Katapult, an online company, leader in the no credit required, lease to own space
New York-based Katapult helps users finance transactions, by partnering with leading brands like Lenovo, Wayfair, and others. In the last two years, they were able to slash their burndown of inbound traffic coming to agents by fifty to sixty per cent thanks to chatbots. “Our most optimistic rates had been 20 per cent, so we were very happy!”, Katapult’s COO, Derek Medlin, told The Fintech Times. Prior to having chatbots, 100 per cent of the flow was being handled exclusively by human agents, which was expensive and time-consuming.
“Our efficiency and customer satisfaction went up,” Medlin said, “but of course it was also hard work, you have to work with the AI, feed it more information and data so it can help provide more recommendations to users.”
Along with AI chatbots, Katapult also uses machine learning for real-time speech analytics, in order to filter conversations towards the right agents. According to the company, this has also helped increase customer satisfaction because it reduces the time spent on a call and the friction for the user.
Katapult uses a third party company for their chatbots, Live Help Now, similar to Intercom, which is widely used to provide chatbots to all sorts of online companies.
The post Silicon Valley: How Fintech is Leading the Way in Chatbots appeared first on The Fintech Times.