Chatbots—Disrupting the ROI of Content
Brandon Chewon 06 December, 2016 at 12:12
The popular narrative of late has focused on the unprecedented possibilities AI-powered Chatbots entice, as we increasingly transition towards a more “conversational interface” as our default digital experience.
However, a truly smart conversational Artificial Intelligence is still a far and uncertain reality for most brands. This also means that those brands are probably reluctant to commit to something that is still vague in execution and outcome; wondering how it will actually work and drive value.
But what all companies understand is content. Content is what they have spent countless dollars and years creating. And they are now increasingly being questioned, what’s the ROI of all this content?
Simply put, the ROI of content is dependent on 3 factors:
- – Distribution
- – Production
- – Commercial Value Generated (Brand Lift, Leads-Generated)
And that’s where Chatbots come in. Let’s dissect how they can disrupt each factor:
- – Distribution – Spend Less, Get More
Today, the pay-to-play access for digital and social has gradually sunk in for most brands. The expectation now is that paid media must support every piece of content.
Chatbots offer the capability of bypassing, to a substantial degree, the current paid media content distribution model. For instance, let’s run through a scenario using the Pregnant Mums category:
Every marketer knows it is important to engage pregnant mums consistently in key milestones throughout each trimester and entire content libraries have been created specifically to serve this need.
However, the cost of ensuring maximum reach on every piece of content is currently prohibitive. Let’s do some quick hypothetical but realistic calculations:
It costs $1,000 per piece of content to reach 10% of target population on Facebook. If we engage with just 1 piece of content per week, we would have a total of 36 pieces over 9 months. In essence, we would be paying $36,000 to reach just 10% of our target audience.
On the other hand, employing a Chatbot would only require paid media for an initial post to announce the Chatbot’s availability and utility. Once consumers are onboarded, they have access to the entire library of content which would be based on their needs and seeded automatically only at the right moment.
Reaching 50% of our population with a single post might require a $20,000 spend, but would be well worth it because getting more consumers to use the Chatbot would ensure long-term lock-in and “free” distribution for future content.
The cost efficiency and distribution effectiveness a Chatbot offers over the current content distribution model makes it hard to imagine a brand saying no.
- – Production – More Money, More Possibilities
Because of the current paid content distribution model, marketing budgets are split overwhelmingly in favor of media versus creative production (typically 70:30).
This means being confined to prioritizing most of the production budget on “Hero-type” content because brands tend to perceive it as having more visible impact. “Hero” content is great for capturing mass attention, but “Hub” and “Hygiene” content are equally essential in moving consumers along the customer journey. However, given budget constraints, allocation for “Hub” and “Hygiene” content is often inadequate to yield any meaningful impact.
So now we have established how Chatbots substantially reduce the cost of paid media for content distribution (especially for “Hub” and “Hygiene”). The savings from this will in turn aid a compelling case for shifting more of the budgets towards production, allowing for a more robust content strategy to be executed.
Another persuasive case to be made lies is the increased lifecycle of content made possible by Chatbots. Companies no longer have to worry about content being “wasted” because entire content libraries (provided it is relevant) can be served to consumers, on-demand and personalized to moments of specific context.
- – Commercial Value Generated – No More Fuzzy Metrics
Truly effective content marketing can only come from optimizing what works; executed through continuous A/B testing and data-driven analysis.
The nature of A/B testing requires having many variations of content to evaluate effectiveness. From a production point of view, it means having to create a greater amount and diversity of content.
However, as discussed above, production budgets are mostly eaten up by “Hero” content. This means less appetite or opportunity for A/B testing to evaluate how and which content actually drives best results.
The only results that matter to a brand’s C-suite is the “commercial value” content can contribute to the following business KPIs:
(1) Brand Lift (2) Leads or Customers Acquired.
In theory, all marketers know that different types of content should work together to drive business KPIs. The problem has been to accurately attribute its value to a specific contribution on the customer journey.
Chatbots offer the opportunity to craft entire content journeys that are mapped and aligned with the customer journey. This allows specific measurement of the content’s value and attribution to a stage in the funnel. The ability to deploy A/B testing for different content journeys will further reveal which approach yields the best results for the most optimal spend.
For example: consumers who interacted with 3 pieces of ‘Content A’ ended up purchasing 20% more than consumers who interacted with 3 pieces of ‘Content B’.
In summary, Chatbots can disrupt and improve the ROI of social content by:
- – Cutting down reliance on paid media for distribution
- – Utilizing savings from paid media to production to execute more robust content strategies
- – Crafting A/B tests and measuring content marketing across entire customer journey for the holistic attribution of value against business KPIs.
Working with Chatbots might initially seem risky but only the brands that take the plunge will be able to test, develop and benefit from the many opportunities and applications Chatbots present today.