How to Use AI Chatbots for Ecommerce in 2024

Have you noticed a neat little tool on most ecommerce websites lately? You open the website and there’s a popup that answers the questions you have on your mind.

And the best part is that more than 87% of consumers find chatbot interactions either neutral or positive. With more positive interactions, customers will remember your brand and will come back for more sales.

We know that customers like a personal touch, but it’s almost impossible to have a human sitting at the backend, answering questions 24/7.

This is why retailers use AI now. With artificial intelligence, the chatbot can keep your customers engaged. And even lead them to the right human representative when the need arises.

What are AI Chatbots

AI chatbots are like virtual assistants except they are AI-powered. They use Natural Language Processing (NLP) to understand customer questions and provide solutions to them. When answers are just seconds away, customers have a pleasant shopping experience and they leave happy.

In short, AI chatbots mimic humans. Or at least they try to. Chatbots for eCommerce can be trained with your company material or product catalog so they can give personalized responses.

For example, a customer might be interested in knowing how long it would take a certain product to be delivered to their home location. An AI chatbot will give them the correct estimate based on the distance between the seller and receiver locations.

What Can AI Chatbots Do for You

Chatbots are there to enhance the buying experience of your customers. Here are some things that AI chatbots can do for you.

Product Recommendations

Going to buy a mattress? How about some mattress covers to protect it? Product recommendations can help you with your upselling strategy. AI chatbots can also access customer buying history to make the right product recommendations according to their previous behavior.

24/7 Support

Having 24/7 human support can be very costly. And inefficient. Why waste precious human hours where AI can work? AI can effectively answer about 70% of customer questions. And when your customers need human help, the chatbot can take them to a human representative, making your support strategy more effective.

Order and Inventory Tracking

AI chatbots can also track orders and provide real-time updates on delivery status. They can offer tracking information, order status, and even refund status. Chatbots can also track inventory and let customers know about the availability of certain products.

Abandoned Cart Reminders

If a customer abandons a cart, the chatbot can remind them about it after a specific time. The bot can even send them discount coupons to encourage the customer to make a purchase.

Personalized Promotions

Is the customer interested in buying a T-shirt? How about giving them a “buy two, get 20% off” deal? This way, they might purchase two instead of one. Yes, your AI chatbot can offer customized deals to upsell your products.

Feedback

What went wrong? Why did a loyal customer stop purchasing from you? Were your prices too high? Or was the shipping too slow? With feedback and surveys, you can get answers to these questions and improve your store.

Product tutorials

If your product needs assembling or setup, your AI chatbot can guide your customers on how to do it. This will avoid back-and-forth customer support and increase customer satisfaction.

And that’s not all. If you train the chatbot right, there’s so much you can do with it. Anything that a human customer support guy can do, AI can do. Well, more or less.

Advantages of AI Chatbots

Why should you use AI chatbots for your eCommerce retail business? Let’s discuss how you can benefit from AI chatbots.

Cost Saving

Human support is expensive. Having agents around the clock will be costly and inefficient. Plus, a human cannot cater to multiple customers at once, which means you’ll need to hire several people for the job. With chatbots, you can have AI handle the basic questions and have experts for detailed explanations.

24/7 Availability

Humans work in shifts but not AI. Technology is always available, no matter what time it is. A customer wants to check out your products at midnight?

Your AI bot is right there to help them out. If they want to know if you deliver to their location, your AI can quickly answer so they stay on your website and browse your products,

Personalization

AI chatbots can give personalized responses. Let’s say your customer is upset because they haven’t received the product yet. They talk to the AI chatbot and it checks the order status, tracks the shipment, and lets them know that they will receive it the next day. Problem solved in just a few seconds.

Scalability

You might be having just a few customers on your website every day for now. But as your business grows, you can start getting hundreds or thousands of visitors daily. AI chatbots are scalable, which means they can handle increased workloads without any extra resources.

Customer Engagement

Remember when customers had to wait in queues for support? It’s very frustrating when you’re assigned a number and you have to wait for hours. With AI support, there’s practically no waiting. The answers are right there and your customers will get them in just a few seconds.

With all these advantages, there’s no point in not using an AI chatbot. Let’s see how you can use a chatbot for your website.

How to use AI Chatbots for eCommerce

So we know by now that chatbots are important. But how do we use them? Let’s understand how you can get an AI-powered chatbot for your website and other communication channels.

Step 1. Find the service you want

There are so many things an AI chatbot can do. Your choices are endless. Here are some things you might want your virtual assistant to handle.

a) Answer frequently asked questions

b) Engage customers by offering them product suggestions, discount coupons, and prompts to checkout

c) Gather feedback, provide shipping updates, or show them tips related to the products they bought

d) Suggest resources and open tickets

Step 2. Find the right chatbot accordingly

Based on the services you want, find the right chatbot that offers these functionalities. Here’s a list of all the top live chat apps for ecommerce.

You can contact some of these companies and learn about their offerings. Once you shortlist a few, check if they offer free trials.

This way, you can try them out without paying. If you’re happy with the services, you can make a payment and subscribe to their services.

As an example, I’ll show you how to use Tidio for live chat. Tidio offers a free 7-day trial so you can safely try it.

Here’s how you can get started with Tidio.

1. Create a Tidio Account

Open Tidio and click on Get Started Free.

It will ask you for your details.

Fill out the form and click on Get Started for free.

2. Let Tidio understand your needs

Once you get in, Tidio will ask you about your needs and create a chat app accordingly. This will give a purpose to your chatbot.

It will ask you to fill up a series of simple questions. It will take about 10-15 seconds and your chatbot will be ready for use.

3. Enter the Dashboard

Once Tidio understands your needs, it will create a dashboard for you. The dashboard will look like this.

4. Install the Tidio widget on your website

Your Tidio account is set up and ready to use. Now you need to install the Tidio widget on your website. For this, visit the widget store of your website builder and find Tidio there. Once installed, make sure you click on Activate to activate Tidio.

5. Configure the Tidio widget

Once the app is set up on your website, you decide how it should look. Tidio is highly customizable so you can give it the same look as your brand.

Choose the same color scheme as your website. This will make the chatbot blend in with the other elements. You can also select an avatar pic for the chatbot.

6. Activate Lyro

Lyro is the AI chatbot that will resolve your customers’ queries automatically. When you install Tidio. Make sure you activate Lyro. You’ll find the option in the Tidio dashboard.

These are the basic steps to use Tidio for your website. Of course, there’s a lot more you can do. You can configure the bot from your dashboard. There are options for creating flows and strategies.

The dashboard also lets you access all the conversations, including the ones that are being held in real-time.

What if You Don’t Use an AI Chatbot?

If you just opened a new eCommerce store, you might want to cut costs. It’s common to think that you can handle the customer questions on your own at this time.

And yes, if you have just a couple of visits to your website, you can manage things without an AI chatbot. But with your marketing efforts, your website will soon pick up, which means you might want to hire more live agents.

That’s what companies traditionally did. They hired people who would work on the backend and answer customer questions.

But think about the number of agents you would need if you have, say, just 40-50 customers every day. That’s not a large number, but you would still need many agents for that, especially if the customers are visiting at odd hours.

People don’t just online shop during regular store timings. This means you’ll need to have different people for different time slots.

Compare this to chatbots that are easy to scale. Heck, they can handle thousands of customers each day. A study by Tidio found that businesses saved almost $11B in 2022 by using chatbots.

A chatbot might sound like an extra investment now, but it saves a lot of money in the long run.

Where Can You Use AI Chatbots?

A chatbot is much more than a virtual assistant. It doesn’t just sit on your website but also on any platform where your customers get in touch with you. Here are some of the most popular channels where you can use an AI chatbot.

Live chat

This little widget on your website is always on. A customer visits the website and the widget pops up to help. This is the first place where you should install your chatbot. It will guide customers through their purchase journey.

Live chat bots engage customers and offer answers to frequently asked questions. This enhances customer satisfaction and thus increases sales.

Facebook Messenger

Most retail businesses have their presence on Facebook. If you have a Facebook page, you must be getting messages from interested customers. Install the AI bot on Messenger and they will get responses to their queries instantly.

You cannot be present all the time on all channels. This is why it’s important to have a bot on all platforms to engage with your customers.

Instagram

As you get multiple DMs every day, it becomes difficult to answer each of them manually. Answering hundreds of DMs can become overwhelming, even if you’re a team of 2-3 people. Just like a chatbot on Facebook Messenger, you can use Instagram Messenger to reply to your customers’ commonly asked questions.

With the Instagram messenger bot, your customers can get product suggestions or price and shipping information for the product they’re interested in.

Whatsapp

Businesses are increasingly using Whatsapp chatbots because most customers are present there. You can streamline your communication by having a chatbot that offers quick customer support.

Many people depend on WhatsApp more than Facebook Messenger. Sending discount coupons on WhatsApp can give you a more personal appeal and make customers come back for more sales.

While these three are the most commonly used communication platforms, you can also get an AI chatbot for other channels such as Telegram and Skype.

How to Customize Your AI Chatbot

You just can’t have a generic chatbot. It should reflect your brand’s tone, look, and feel. But how do you personalize it?

Installing the widget and activating it is one thing. Giving it a personalized appeal is a whole different thing.

A few years ago, virtual assistants were used to assist customers on websites. However, AI chatbots are different as they use machine learning to understand what the customers want.

They can be trained with context, intention, and sentiments. With such an approach, customers get instant and accurate replies, which boosts customer satisfaction.

Here’s how you can personalize your chatbot.

Recognize the functionality you want to provide

Why do you want to have a chatbot? What’s its major objective? Of course, you want the bot to be as helpful as possible, but what do you think is the major reason you want to get it?

For example, you might want it for support. It could answer commonly asked questions and even troubleshoot some issues from your customers.

Or maybe you want it to drive more sales by recommending the right products. You need to identify your primary reason for using a chatbot.

Give it the right look

Align your chatbot with the brand's look and feel. You can customize the color and font of the chat widget. You can also give it a name and a display picture so your customers will have a human-like experience.

Give it a voice

You need to understand your brand voice. Is it going to be a fun and witty one? For example, if your target audience is teenagers, you might prefer a more Gen-Z approach. But if you cater to businesses (if you have B2B solutions), you may like a more formal approach.

Your AI chatbot will take the personality you assign to it. Set the tone and voice to match your brand.

Set up greetings

How should your chatbot greet your customers when they visit your website or send you a message? It could be a simple “Good morning, what can I do for you today” or “Howdy doody, what’s shakin’?” The right greeting can make the customers open up and feel more connected to your brand.

Select your communication channels

Your AI chatbot is definitely going on your website – that’s the first place you’d want to deploy it. But what about the other communication channels?

Do you want your bot to be on Facebook Messenger? Instagram? Whatsapp? Other communication platforms? You need to consider all the channels where your customer base might be present.

Monitor analytics

Setting up the chatbot isn’t enough. You need to study the results. How well is your bot performing? You need to continuously improve the chatbot so it matches your customers’ expectations.

A good chatbot solution will let you access the analytics so you can see how accurately it answers customer questions.

Set KPIs

Having some Key Performance Indicators can help you monitor the chatbot in a better way. You can set the KPIs depending on your needs. Some metrics you can set up are retention rate, conversion rate, engagement rate, etc.

Use Cases of AI Chatbots in eCommerce

Let’s look at some big brands that use AI chatbots to improve their performance.

Amazon

I’m pretty sure you’ve heard about Alexa. Chances are, you might have even used it. Alexa helps you place things in your cart and even suggests products based on your previous purchases and searches. It is also integrated with Amazon Prime and helps you through other Amazon apps (for example, Amazon Music.

H&M

Fashion brand H&M launched a chatbot on Kik, a messaging app, in 2016. Kik is largely used by teenagers, which made the brand even more popular among the young crowd.

The bot allowed shoppers to create and browse through outfits created by others. If they like something, they can purchase that particular outfit and accessories.

Domino’s

Domino’s offers a very personal chat experience with their chatbot, Dom. Dom is active on their website, Facebook Messenger, Twitter, Slack, and many other channels. You can place your order through Dom. It will not just take the order but will also process the payment so everything is done smoothly.

Future Trends of AI Chatbots in eCommerce

According to Gartner, chatbots will become the primary customer support channel in almost a quarter of all organizations by 2027.

Companies without AI chatbots will be lagging, and this is especially true for retail companies where customer satisfaction is of extreme importance.

As chatbots are becoming more human-like, they can enhance customer experience even more. There is also a strong possibility of the growth of voice technology. As the new bots start getting popular, more searches will be voice-generated.

What Does This Mean for Your eCommerce Retail Business?

AI chatbots bring a lot to the table. They enhance customer engagement, increase sales, reduce costs, offer data-driven insights, provide an omnichannel experience, and are scalable.

That’s quite a mouthful. Can you afford to not have an AI chatbot on your website?

Especially since many AI chatbots are free to use.

Conclusion

In conclusion, I would say that if you haven’t installed an AI chatbot on your website (or other communication channels), you’re missing out on an amazing opportunity.

There are many chatbots out there and some offer free accounts. Even if you’re new in the eCommerce retail business, it doesn’t hurt to try an AI bot.

I’ve explained using Tidio in this article but you can try any chatbot of your choice. Here’s a list of all the top live chat apps for eCommerce.

Frequently Asked Questions (FAQs)