Consumers find chatbots disappointing, but that won’t harm adoption

A lot’s changed since Tay. The advent of AI tech like ChatGPT dramatically improved the chatbot experience, showing that chatbots aren’t necessarily destined to deliver underwhelming back-and-forth conversations. But a new survey shows that, at least when it comes to customer service, chatbots still have a long way to go before they meet most people’s expectations.

Customer engagement platform Cyara commissioned Forrester to poll over 1,500 consumers who’ve used sales or support chatbots in the last six months about their recent experiences. Close to a majority said they were bearish on chatbot technologies, with roughly half agreeing that the chatbots they’ve used often frustrate them and nearly 40% characterizing their interactions with these chatbots as negative.

Consumers find chatbots disappointing, but that won’t harm adoption by Kyle Wiggers originally published on TechCrunch

The year customer experience died

This was a rough year for customer experience.

We’ve been hearing for years how important customer experience is to business, and a whole business technology category has been built around it, with companies like Salesforce and Adobe at the forefront. But due to the economy or lack of employees (perhaps both?), 2022 was a year of poor customer service, which in turn has created poor experiences; there’s no separating the two.

No matter how great your product or service, you will ultimately be judged by how well you do when things go wrong, and your customer service team is your direct link to buyers. If you fail them in a time of need, you can lose them for good and quickly develop a bad reputation. News can spread rapidly through social media channels. That’s not the kind of talk you want about your brand.

We’re constantly being asked for feedback about how the business did, yet this thirst for information doesn’t seem to ever connect back to improving the experience.

And make no mistake: Your customer service is inexorably linked to the perceived experience of your customer. We’re constantly being asked for feedback about how the business did, yet this thirst for information doesn’t seem to ever connect back to improving the experience.

Consider the poor folks who bought tickets for Southwest Airlines flights this week. One video showed airline employees had sicced the police on their own passengers. Consider that the airline admittedly screwed up, but one representative of the same airline actually called the police on passengers for being at the gate. When it comes to abusing your customers and destroying your brand goodwill, that example takes the cake.

For too long we’ve been hearing about how data will drive better experiences, but is that data ever available to the people dealing with the customers? They don’t need data — they need help and training and guidance, and there clearly wasn’t enough of that in 2022. It seemed companies cut back on customer service to the detriment of their customers’ experience and ultimately to the reputation of the brand.

The year customer experience died by Ron Miller originally published on TechCrunch

Embracing digital commerce may be retailers’ best bet for staying ahead of a fast-moving industry

Myriad companies have made digitally driven commerce work for them, but others have struggled to find success or are unsure where to start.

Between livestreaming and big players like TikTok, Amazon and Twitter getting into e-commerce in the metaverse, social commerce is going to be a force to be reckoned with.

This market’s gross merchandise value in the U.S. is expected to be $99 billion by 2025, and it’s expected to grow 25% each year, according to GP Bullhound Global Insights’ Technology Predictions 2023 report. That is compared to China’s $1.02 trillion market, predicted to grow at 26% each year. Overall, the market is forecast to hit $3.8 trillion by 2030.

“When you know what you want, you search for it, but when you don’t, this is where live commerce makes sense.” Voggt's Kevin Loiseau

It’s also an area that we have followed intensely, especially since shopping was forced online at the beginning of the pandemic. And a lot of companies are doing compelling things.

Take Kahani, for example. Its founder, Jesse Pujji, told TechCrunch in October that the future of mobile e-commerce was going to look like TikTok, Instagram and Snap, and modeled Kahani’s first product to be a “Stories-like” feature so that brands could show their clothes being worn “live” versus static images of the front and back views.

Earlier this month, Amazon launched Inspire, a social media-inspired feature that provides a TikTok-like shopping experience with short-form videos and photo feeds.

Though the pandemic-induced online shopping frenzy has cooled as more people venture out again, with all of the different methods out there for digital commerce, driven in large part by livestreaming and social media, it’s time to take a look at where this industry is headed, who the dominant players will be, what the challenges to adoption are and what brands will have to do to keep up.

Embracing digital commerce may be retailers’ best bet for staying ahead of a fast-moving industry by Christine Hall originally published on TechCrunch

Duffl’s David Lin dishes on why traditional rapid grocery delivery is not working

Quick commerce grocery delivery companies are having a moment, and not necessarily a good one.

An industry that was on fire at the beginning of the global pandemic, mainly due to people forgoing IRL grocery shopping, has slowed as shoppers returned to brick-and-mortar stores.

As a result, several so-called q-commerce companies pumped the brakes. Gorillas said it would acquire competitor Getir and plans to inject $100 million into the company to help it out. In May, Getir announced layoffs. Gopuff announced plans to pull back in Europe, while JOKR left the U.S. and abandoned two Latin American markets as well. Perhaps most notably, Instacart paused its IPO.

While these kinds of announcements became more frequent this year, Duffl co-founder and CEO David Lin believes his quick commerce startup is an outlier in the sector.

Duffl, David Lin

Duffl co-founder and CEO David Lin. Image Credits: Duffl

How, you ask? By tapping into a model that focuses on 10-minute delivery of higher-margin goods, like snacks and convenience items, via e-scooter in more dense areas, enabling college students, called “Admirals,” to lead and run their own seven-figure businesses on campus.

That strategy has paid off so far: Duffl went through Y Combinator in Winter 2020 and has since raised over $13 million, including a $12 million Series A, led by Volition Capital in October 2021.

Duffl started off at UCLA, where Lin was an undergrad, and is now on the campuses of Arizona State University, University of Arizona and University of Texas, some of which are already cash-positive. Admirals and their employees fielded 35,000 orders in September from 11,000 students across those campuses and managed 69% growth in new customers from referrals during the same month, Lin said.

He spoke with TechCrunch about how he’s made quick commerce work for Duffl while others struggled. The following has been lightly edited for length and clarity.

TechCrunch: We’ve seen some quick commerce companies struggle lately. What are the challenges to this market and how have some companies gotten it wrong?

David Lin: It’s certainly a difficult time for everyone, but especially players in this space, and in a down market, where you’re fundamentally dealing with low-gross-margin products, like groceries, produce and perishables. In addition, dealing with such a small time frame for delivery, you run into a lot of labor-related expenses, like transport, pick and pack costs, insurance and real estate overhead, that are very difficult to scale.

It sounds like it has much to do with the way a delivery company sets up its business model, correct?

Certainly. I would say that history doesn’t necessarily repeat itself, but it does rhyme. I started doing this in 2018, and it was quite interesting to watch the evolution through the pandemic.

Duffl’s David Lin dishes on why traditional rapid grocery delivery is not working by Christine Hall originally published on TechCrunch

4 ways to use e-commerce data to optimize LTV pre- and post-holiday

For consumer brands, the holiday season is go time. The high-energy, two-month period that starts on Black Friday and Cyber Monday (BFCM) can account for as much as 19% of a brand’s total annual retail sales, according to the National Retail Federation.

Even as brands have visions of profits dancing in their heads, there’s another side to the holiday season they must consider. Holiday shoppers tend to be the worst when it comes to customer lifetime value (LTV). Too many shoppers will buy once from your brand and then disappear. They might come back next year in some cases. Other times, they’re gone forever.

How do you take one-and-done shoppers and turn them into loyal brand advocates? The answer lies within the treasure trove of commerce data that you collect.

Let’s examine four ways that your commerce data can help you craft the right pre-holiday strategy and drive repeat post-holiday business.

Pre-holiday: Optimize your marketing spend

Proper segmentation drives better personalization during the holiday season.

In light of growing uncertainty over the effectiveness of digital advertising, brands must carefully monitor their marketing spend data in November to see whether they’re on track for success or failure over the holiday season. Your ROI should increase the closer you get to BFCM. If it’s not, you need to adjust fast to optimize your holiday profit margin.

At a high level, you want to monitor the effectiveness of each marketing channel over the holidays. One of the most helpful metrics to track is return on ad spend (ROAS), a barometer of efficiency that shows how much revenue you generate for every marketing dollar spent. Break your ROAS down by channel and watch for any sudden fluctuations or red flags so you can make adjustments in real time.

To see whether your marketing efforts are driving profitability and bringing the right customers to your website, you can go a step further by running a cohort analysis that measures LTV:CAC ratio. This calculation will give you valuable insight into your customer lifecycle so you can identify the ROI for each dollar you spend on customer acquisition.

To do so, you’ll need to create time-based cohorts of “customers from first time of purchase” and compare them year over year. Because the exact dates of BFCM are fluid, we recommend starting by making Black Friday day 0, then counting backward (-1, -2) pre-BF and forward (+1, +2) each day after BF. This also works for performing an LTV:CAC cohort analysis for Christmas sales using Christmas as day 0.

4 ways to use e-commerce data to optimize LTV pre- and post-holiday by Ram Iyer originally published on TechCrunch

Amazon CEO Andy Jassy faces enormous challenges amid falling profits and negative numbers

Amazon CEO Andy Jassy is the definition of a company man. In an age when people switch jobs frequently, he has been at Amazon for 25 years, working his way up to president and CEO. But before he reached the corner office, he helped build Amazon Web Services, its cloud arm, into a $60 billion juggernaut.

It wasn’t exactly a rise from the mailroom, but Jassy was there as founder Jeff Bezos’ aide-de-camp when they came up with the idea of AWS in the early 2000s at an executive offsite. He helped build it. He nurtured it. He made it into the crown jewel of the company.

So when Bezos announced he was stepping down early last year, it didn’t take long for the organization to turn to Jassy, whose hard work at AWS and his deep understanding of company culture seemed to make him the perfect heir apparent.

But things haven’t necessarily gone as planned since he took over the leadership role in July 2021. Much of what has happened has been out of his control. Like many chief executives, he inherited the problems left behind by his predecessor.

During the pandemic, Amazon became the general store for the world. People stuck in lockdown turned to Amazon for their goods. The company’s revenues mushroomed and its workforce exploded, with the organization adding an astonishing 800,000 workers, mostly in its warehouses (per The Wall Street Journal). The future was bright, but as Jassy took over last year, people were heading out again.

Suddenly, everyone wasn’t buying everything online anymore. As we headed into 2022, other macroeconomic factors began to affect commerce — online and brick-and-mortar — as inflation soared and consumers’ buying power began to diminish. Add to that the higher cost of energy and persistent supply chain issues, and Amazon was suddenly facing some challenges that were beginning to have a serious impact on earnings.

Amazon CEO Andy Jassy faces enormous challenges amid falling profits and negative numbers by Ron Miller originally published on TechCrunch