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Drive growth and reduce costs with omnichannel business messaging

The future of customer conversations for travel and hospitality brands

Chatbots killing your best customers
May 11, 2022 • 7 min read
Mark argyle
Mark Argyle
SBM blog CTA mobile 1

Drive growth and reduce costs with omnichannel business messaging

SBM blog CTA mobile 1

Drive growth and reduce costs with omnichannel business messaging

A high-value customer is trying to book a suite at your resort… and you make them click through menus, fill out endless forms, and talk to a clumsy chatbot.

They’re your most profitable customers not because they are cost-conscious. They come back to your business because they value great services. Instead of getting assistance from a team member 1:1 in your mobile app right away… you send them to a chatbot! A CHATBOT!

This is that they’re thinking: “I want to book a $3000 a night suite and you make me jump through the hoop… and talk to a chatbot?! How about a real person to walk me through my options, understand my needs, craft a personalized itinerary, and help me complete the booking all from my tablet?”

Don’t be surprised if they decide to book with your competitor that offers assistance from a (human!) concierge who takes the time to interact with their customers.

After all, it doesn’t quite make sense to put your most loyal and valuable customer in the hands of a machine and hope for the best.

Chatbots are hyped as a cost-effective way to end all your customer service woes. But the reality is that they could be killing your customer relationships—particularly in the travel and hospitality or luxury goods industries where the most loyal and profitable customers value services and experience.

Why chatbots could be compromising your customer service

Most consumers prefer human agents to chatbots for their more complex customer service engagements.

Let’s be fair: AI-powered chatbots have come a long way. They can recognize millions of words and configurations to deliver helpful information and complete preset actions. But they still don’t have the conversation skills of a human, which is key to building customer relationships and effectively handling volatile situations.

Chatbots don’t have the ability to understand and express emotions, so they can’t help your brand develop a deeper emotional connection with customers. This can be especially damaging for the travel, hospitality, and lifestyle industries, where customers make decisions based on how they feel when interacting with a brand.

The poor experience often drives away customers and negatively impacts your revenue and customer lifetime value (CLV) while increasing churn and damaging your reputation.

In short, chatbots fall short in areas that matter most to high-ticket sales where decisions aren’t made based on cost but on the customer experience and emotional connections with a brand. In fact, ​​only 9% of consumers found chatbots helpful when they tried to purchase an expensive item or service.

Let’s take a closer look at how this pans out in the travel and hospitality industry:

There will always be a segment that goes to and spends hours comparing every single permutation to save $12. But they don’t buy because of loyalty, and chasing their business is a losing proposition.

Most people don’t want to spend the time to compare tons of sites and aggregators, stringing together flight legs and hotel nights. Some consumers even long for the “olden days” when a travel agent takes care of all the bookings so they can have a reasonably priced itinerary that doesn’t send them through 6 different airports.

These customers are willing to pay more to get 1:1 assistance from a specialist to save time and headache. Meanwhile, many want the convenience of online booking instead of driving downtown to a travel agent.

Online interactions with a travel concierge offers the best of both worlds they seek. If you send these customers to a chatbot, you’re driving them away because they can’t get the personalized services they value.

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When should you use chatbots, and what’s the alternative?

86% of consumers prefer to interact with a human agent, and 71% are less likely to buy from a brand that doesn’t have human customer service representatives. Meanwhile, more consumers are getting used to chatbots and appreciate how they resolve simple questions quickly.

How can you leverage the benefits of chatbots without hurting your customer service and relationships?

We must understand the strengths of chatbots, where they can be valuable to your business, and how they may fall short.

Chatbots are fast and effective in solving straightforward customer questions using information readily available in your system. They’re better received by the younger generations and more effective in processing lower-value or routine transactions.

On the other hand, chatbots fall short in tackling non-standard, complex questions or handling emotional situations (e.g., when a customer is upset.) Older consumers tend to be more skeptical about new technologies, while customers purchasing high-ticket items or services expect personalized support when they want it.

Can you have your cake and eat it too?

Yes. You can take advantage of short response time, 24/7/365 availability, and cost-saving benefits of chatbot technologies without hurting your customer relationships or CLV.

The key is to use chatbots where their strengths shine and supplement customer interactions with human agents for complex inquiries or purchases to deliver a personal experience.

That’s why successful lifestyle and luxury brands supplement chatbots with live chat to offer real-time assistance with a human touch. You can streamline customer support while increasing customer satisfaction and loyalty.

What if providing 1:1 service to every customer becomes cost-prohibitive? You can start with first-class passengers and people who want to book vacation packages (i.e., higher-ticket items) to retain customers who are mostly likely to stay loyal when you provide personalized services.

How in-app chat benefits lifestyle, travel, and hospitality brands

Live chat connects your customers with human agents who can understand their moods and tones to deliver the appropriate support, have meaningful conversations, and improve customer engagement.

Here’s how live chat can help deliver a concierge experience customers expect from travel, hospitality, and luxury brands to improve customer experience and CLV:

Provide real-time, immediate support

Consumers don’t want to be caller number 15 on the phone queue or get an auto-response email that promises a reply within 48 hours. Instead, they expect to get the answers they need, when they need them—especially when they’re ready to make a purchase. Live chat allows you to provide timely customer service, so you don’t risk losing a sale.

Increase conversions and revenue

Live chat allows brands to connect with potential buyers at the most critical moments in the customer journey (e.g., when they need help at checkout.) Besides driving conversions, agents can understand customers’ needs, reference the items already in their cart, and recommend relevant products to increase average order value (AOV) through cross-sell and upsell.

Deliver a seamless customer experience

Agents can pull up customer information from other systems (e.g., e-commerce, CRM) so customers don’t have to recount their issues for the ninth time. For example, a customer can simply enter their email address, and agents can see their order number, purchase history, past inquiries, and account preferences to provide the most appropriate support.

Build loyalty with a personal touch

Live chat helps you deliver the high-touch personal interactions consumers expect from luxury brands, particularly when solving complex issues that require one-on-one attention. The personal interactions allow you to create a curated shopping experience that keeps customers coming back and telling others about it.

Deliver a bespoke customer experience with in-app live chat

As more consumers interact with brands on their smartphones, mobile apps provide the ideal platform for connecting with your customers and delivering high-touch services whenever and wherever they prefer.

Building a chat function into a web or mobile app can be complicated, but the good news is that you don’t have to reinvent the wheel. Sendbird’s powerful chat API allows you to add a concierge feel to your app in no time. You can go above and beyond chatbots or “same old online chat” to deliver a personal, immersive, and high-end experience.

Besides chat, our in-app solution includes voice and video calls so your customers can interact with your brand through their preferred channels and get even the most complex questions answered. The interactivity also allows you to build emotional connections, develop trust, deliver a memorable customer experience, and accelerate the buying journey.

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