Mirco Pasqualini
Mar 28, 2016 · 5 min read

In the next two years the rise of the Conversational UI (ChatBot / Virtual Assistant) will phagocytize more than 30% of the digital direct / social marketing business and create a new way to dialog and engage customers in the digital space.

Chats and other messaging system platforms are the most diffuse communication environment across all markets (by segments and demography) and in Q1 2015 surpassed social network platforms in terms of active users and daily interactions.

Platforms like FB Messenger, Whatsapp, Kik, WeChat and Apple iMessage, currently continue to manage the largest target audience in the world, more than mailing lists and the social networks.

In order to understand the context, here are numbers about some of the main players:

  • FB Messenger: 800 Million (active users by month)
  • Whatsapp: 1 Billion (active users by month)
  • WeChat: 697 Million (active users by month)
  • Google Chat: 425 Million (Android installed)*
  • Apple iMessage: 400 Million (Phone installed)*

*=Users segmented though other platforms.

Today, about 2.5 billion people are registered to use at least one messaging app, according to advisory firm Activate. By 2018, the firm expects that number to be 3.6 billion, 90% of the world’s Internet-enabled population.

What’s happening in the messaging business

Messaging is central to mobile, and as more people have access to smarter phones SMS is rapidly becoming an anachronism. That’s why the messaging platforms are becoming the new communication and information human interface in the web ecosystem.

“Threads will be the new app environment.”

Facebook, Whatsapp, WeChat and Apple as well, are developing technology (Facebook is already in the beta phase and building a BotStore) to transform each message in a potential mini application.

It might be just an application that displays text, a photo, or alternatively presents an interface for something more complex in the constrained environment of a message cell like search results or e-commerce checkout. There is an unlimited set of opportunities to create bite size applications like product suggestions, media players, mini games, inventory items, in-messaging payments, digital content, assistant, consulting and many others.

Thanks to the conversational approach, these AI/ChatBots are able to learn and catch opportunities in the dialog with the consumer and create engagement, loyalty and an opportunity of a business transaction.

A good recent example is Quartz, an App that turns news reading into a message conversation reducing searching time, understanding news, segmenting and better personalizing content and transforming push-content in a new useful approach.

Quartz App for iPhone

Why the Conversational UI will be a winner?

In contrast to a GUI that defines rules for each interaction — rules which, frustratingly, change from app to app — text-based, conversational interactions are liberating in their familiarity. There’s only really only one way to skin this cat: The text I type is displayed on the right, the text someone else typed is on the left, and there’s an input field on the bottom for me to compose a message.

The rise of the ChatBot* and the death of the email marketing

* = ChatBots — a chatter robot is a type of conversational agent, a computer program designed to simulate an intelligent conversation with one or more human users via auditory or textual methods.

The shift from the touch points between customers and Brands from Non-Conversational UI (Email, App, Website, Social Network) to Conversational UI platforms will drastically move huge budgets into this new environment because they are simpler, more engaging, targeted, dynamic and effective.

For the first time marketing actions will be 100% effective, personalized user by user, fully measurable, and fully integrated with transitional functionalities.

Right now the opening / click and reaction rate of email or other forms of push marketing is around a range of 15–25% to be considered successful versus a 90–100% of an interaction through a conversational UI.

What kind of scenario can we expect in the next two years?

A shifting environment

A considerable portion of search activities will shift from Google and other search engine platforms to ChatBots, where the search will be more contextualized, simple and useful. Big e-malls like Amazon will benefit greatly in this scenario since they will be able to operate in a huge variety of contexts.

Supporting this trend are the latest reports from Google indicating that even though the global main traffic is on mobile and is growing, the search activities are not growing along with it, perhaps because searches on mobile are not exactly easy and effective from the user’s perspective.

Disruption

The entire business of email marketing, SEO, customer engagement solutions and a portion of display advertising will be disrupted by a new way to reach and engage customers; it will be more effective, targeted, with a new asset of knowledge and technology required like AI, analytics, engagement conversation strategy, predictive user/consumer behavioral, etc.

This will require a structural change of market specialists in terms of technology and capabilities and an internal re-organization for brands since all the departments will be involved in this new form of customer interaction.

Construction

A new market segment will arise, focused on providing this new expertise and knowledge and improve solutions such as omni-channel eCommerce & Customer Engagement, Informations and Services.

This new market segment of +4 billion active users in messaging platforms (number estimated for the 2017 Q4) will cause a shift of a portion of the current $24 billion of budget spending by brands into social media / email vs the Conversational UI solutions.

Summary

Without a doubt, Conversational UIs (ChatBots) are the next big thing driving business opportunities over the next two years. In short, Conversational UIs will bring about one of the fastest market shifts and disruptions ever.

The only question will be, “how fast will brands be able to adapt to this new scenario and take advantage?” The Conversational UI will not only represent brands in terms of capabilities to reach their customers, understanding technologies and provide a better service, but also in showing the soul of the company, the think-wave and how much an organization is smart and dynamic.

Developing a correct ChatBot / Company Voice will require a great effort with all the companies since it will impact and engage each single department and resource and we know well how much this requires a strong and disruptive leadership to drive the transformation.

Sharing by Mirco Pasqualini

All about what catch my attention

Mirco Pasqualini

Written by

Head of Design @ Ogilvy

Sharing by Mirco Pasqualini

All about what catch my attention

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