Are Chat­bot Pay­ments All Talk?

Bots are tak­ing over as a vi­able chan­nel for mar­ket­ing and pay­ments. Some well-known brands are work­ing closely with Face­book to make this hap­pen.

ISO & Agent - - INSIDE 07/08.2017 - BY JOHN ADAMS

Re­tail­ers and pay­ment brands are en­gag­ing their cus­tomers on Face­book Mes­sen­ger and other chat plat­forms. And Face­book is play­ing an ac­tive role in mak­ing this hap­pen.

Chat­bots have been per­co­lat­ing for a while as the next big chan­nel for com­merce and P-to-p pay­ments, and the tech­nol­ogy hit a fever pitch re­cently with a slew of high-pro­file mer­chant an­nounce­ments that sug­gest the tech­nol­ogy has reached a turn­ing point.

“We’re ex­cited to see where the tech­nol­ogy takes us in the fu­ture,” said Don­ald Evans, chief mar­ket­ing of­fi­cer of The Cheese­cake Fac­tory Inc., which op­er­ates the restau­rant chain of the same name. The Cheese­cake Fac­tory is one of the first mer­chants to use a Face­book Mes­sen­ger chat­bot with Master­pass, along with Freshdi­rect and Sub­way.

The restau­rant chain and Mastercard were not alone. Western Union and Money­gram also launched Mes­sen­ger bots last week, and Wells Fargo and Amer­i­can Ex­press an­nounced new chat­bot ini­tia­tives dur­ing Face­book’s devel­oper con­fer­ence, F8, re­cently in San Jose.

In some cases, the com­pa­nies are early adopters of new pay­ment tech­nol­ogy in gen­eral. Amer­i­can Ex­press has made dig­i­tal en­gage­ment and de­liv­ery a sub­stan­tial part of its at­tempt to re­cover from the loss of the Costco co­branded re­la­tion­ship, while Freshdi­rect more re­cently em­bed­ded its ser­vice in Sam­sung’s new web con­nected re­frig­er­a­tor.

Amex up­dated an ex­ist­ing bot for Mes­sen­ger by iden­ti­fy­ing fre­quently asked ques­tions such as “What is my bal­ance?” or “I have a ques­tion about a pend­ing charge.” And Wells Fargo’s chat­bot will use ar­ti­fi­cial in­tel­li­gence to an­swer ques­tions about bal­ances and ATM lo­ca­tions.

The Cheese­cake Fac­tory has also ag­gres­sively de­ployed mo­bile tech­nol­ogy. It has its own Cake Pay app, which is in­te­grated with Master­pass and the Mes­sen­ger bot. The chain has also par­tic­i­pated in Master­pass’ ad cam­paign and is an avid user of so­cial me­dia such as Face­book and Pin­ter­est. Cake Pay ad­di­tion­ally in­te­grates with Ap­ple Pay and Paypal, and Evans said the chain is con­sid­er­ing ex­tend­ing its use of chat­bots and ma­chine learn­ing to other venues.

The Cheese­cake Fac­tory will also

use the Master­pass bot to tai­lor and de­liver gift cards, which is part of the restau­rant’s brand­ing strat­egy as a “cel­e­bra­tory” venue.

“The Master­pass bot will al­low us to have a new chan­nel of con­ver­sa­tion with our guests,” Evans said. “Con­ve­nience is a big fac­tor, and just as com­mu­ni­ca­tion has evolved through tech­nol­ogy, so have gift cards.”

The an­nounce­ments last week came as Face­book fin­ished a set of up­grades to its Mes­sen­ger pro­gram, which are de­signed to make it easier to ac­cess for de­vel­op­ers and en­hance user’s abil­ity to spot bots, both im­prove­ments which build upon the so­cial net­work’s ear­lier work to make it pos­si­ble to em­bed trans­ac­tion ca­pa­bil­i­ties into Mes­sen­ger when the bot fea­ture de­buted about a year ago.

Mes­sen­ger will have a new dis­cov­ery tab that shows fea­tured bots, trend­ing bots, a search bot and a QR reader to al­low users to add bots by scan­ning a code. And de­vel­op­ers will be able to build fea­tures that au­to­mate re­sponses to ques­tions about when a store is open or other gen­eral ques­tions about the store’s busi­ness.

Bot tech­nol­ogy is ad­vanc­ing else­where in fi­nan­cial ser­vices. Trans­fer­wise in­tro­duced a Mes­sen­ger Bot in Fe­bru­ary and Cap­i­tal One in March in­tro­duced a bot called Eno that an­swers ques­tions about trans­ac­tions and bal­ances.

While mo­bile wal­lets are not yet main­stream, pair­ing mo­bile wal­lets with chat­bots can broaden adop­tion among peo­ple most likely to use new chan­nels, ac­cord­ing to Thad Peter­son, a se­nior an­a­lyst at Aite Group.

“I think it’s pre­ma­ture to con­sider mo­bile wal­lets es­tab­lished. Pen­e­tra­tion and us­age is cer­tainly grow­ing but rel­a­tive size of the user base is still in­fin­i­tes­i­mal when com­pared with other al­ter­na­tives,” Peter­son said.

“More likely, pair­ing bots with wal­lets al­lows providers to ex­pose them to a user who is def­i­ni­tion­ally open to new of­fer­ings and bet­ter ways of do­ing things,” he said.

Bots also con­form to the so­cial net­work­ing ecosystem and may be more fa­vor­ably re­ceived by mil­len­ni­als, the pri­mary de­mo­graphic for mo­bile wal­lets.

“Put an­other way, if I’m on In­sta­gram/snap[chat] all day, a bot is less in­tru­sive and more ac­cepted than if I’m not, and mil­len­ni­als and mo­bile wal­let users gen­er­ally fit that cat­e­gory,” Peter­son said.

The Cheese­cake Fac­tory was one of sev­eral mer­chants to launch a chat­bot to sell to pa­trons on Face­book Mes­sen­ger

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