Tuesday, August 16

Chat Bots Are Taking Over the World

America’s most popular teenage chat app just made a bold marketing move. The creators of the app launched a new feature that could end up being the future of the advertising industry, or could at least breach a new marketing territory regarding how different brands interact with each other and consumers.

Social media reputation management is critical to any type of brand management, and without it minor issues can become major public relations disasters. But what if people conversed directly with brands and companies via bots?

This is what Kik, a popular teen chat service (similar to WhatsApp) is doing. There may be nay-sayers out there already saying that the chat box is nothing new, and most of us have AOL’s Instant Messenger in mind when it comes to talking with bots. Kik users are having real-time, actual conversations with multiple brands, such as Moviefone and Funny or Die. They even have the luxury of contacting the Kik team itself.

Here’s the history: In the 1960’s, MIT professor Joseph Weizenbaum invented a computer program that could communicate with a real human being. Since then, bots have been improving — they can respond to our questions, look up information for us, and give us advice. Most now have the ability to learn from conversations with us.

Chat apps are on the rise and are offered at cheap prices on app stores via Android and Apple products. WhatsApp has over 500 million users around the world and was recently purchased by Facebook back in February for a cool $19 billion. WhatsApp’s competitors are flourishing in Asian as well, giving rise to a new kind of brand marketing.

“If you could chat with a brand in the same way you chat with a friend, that’s powerful,” said Ted Livingston, founder of Kik.

Not quite sure what the fuss is about? Lets review a real-world example of a chat app at work: Line, a Japanese app with 400 million users, saw an account for Paul McCartney in October 2013 skyrocket to popularity. McCartney’s handlers paid Line to create virtual “stickers,” which its users exchange on chat apps and are now so popular that they have become a leading source of revenue for the company. To receive the stickers, users simply had to interact with the chat bot that sends them updates about the singer.

What Kik is hoping to do is take this interaction one step further. Instead of bots sending messages at users, what if there was an app that converses with them instead?

At the moment, Kik’s chat bots are in their fetal stages; most cannot carry on a conversation without pushing more brands onto the user. However, this was done on purpose in order to prevent a bot from saying something that could damage a brand’s reputation.

In 2000, the U.S. Internet advertising revenue was $8.1 billion. In 2011, that figure jumped to $32 billion. That figure is supposed to increase exponentially, and chat apps could be the main cause for the steady increase in revenue.

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