Conversational Business: A Guide for Digital-first Brands

What is conversational business? 

Conversational business refers to the practice of creating real-time, two-way communication between companies and their customers across multiple digital touchpoints.   

Unlike traditional, one-way communication methods like email or static FAQ pages, conversational business engages customers in dynamic, ongoing interactions that mirror human conversations. These conversations occur on various platforms like live chat, chatbots, social media and messaging apps, providing a more immediate, personalized experience.   

For example, instead of waiting on hold for customer support, customers can engage in live chat on a website, receiving immediate assistance tailored to their needs. This accelerates response times and fosters a sense of immediacy and customer-centricity, leaving customers with the impression that the company is attentive and focused on their satisfaction.   

Look at Bloomingdales. The brand introduced a “Chat with a Style Expert” widget, taking customer engagement to a new level. With just a click, users can:    

• Get personalized support on orders 

• Book a private, 1:1 video shopping experience 

• Chat live with an expert stylist in their region 

• Choose a style expert based on their location and personal preferences 

This approach exemplifies the power of hyper-localization and personalization in conversational business. Notably, the chat widget adapts to the specific products a customer is viewing, ensuring tailored advice that resonates with individual tastes and needs. This level of customization reinforces customer loyalty and elevates the overall shopping experience by making it highly interactive and context-aware. 

Types of conversational business applications 

Conversational business applications take many forms, each offering a unique method of engaging customers and elevating their experience. Whether through voice bots, messaging apps or virtual agents, these tools enable you to provide real-time, personalized support.

Let’s explore the key types of conversational applications transforming the customer experience today. 

1. Instant messaging and chat apps

Messaging and chatting apps are popular for real-time, text-based interactions. Platforms like Facebook Messenger and WhatsApp are commonly used to offer instant support, send personalized updates and deliver one-to-one communication with customers.     

For instance, Sephora uses Facebook Messenger to offer beauty advice, product recommendations and appointment bookings. Such direct lines of communication help it build stronger customer relationships by providing tailored assistance.      

2. Chatbots and AI tools    

Chatbots are among the most widely used tools in conversational business today. They offer automation and efficiency without compromising the customer experience. These AI-powered tools can manage routine queries, process transactions and provide personalized product recommendations. As conversational AI evolves, intelligent virtual agents can leverage natural language processing (NLP) to understand context and provide increasingly sophisticated responses.    

For example, the chatbot on H&M’s website assists users with product searches, style advice and order tracking, all while the technology learns and improves with each interaction.    

3. Voice assistants    

Voice assistants like Amazon Alexa, Google Assistant and Apple’s Siri have revolutionized how businesses and customers interact. They offer hands-free, voice-activated communication. These tools can assist with various tasks, from setting reminders to answering product-related inquiries, making customer interactions more seamless and intuitive.    

The best example is how Domino’s allows customers to place orders simply by speaking to Alexa. Such hands-free features make it easier for users to engage with the brand, enhancing the overall customer experience.  

Conversational business vs transactional business 

When comparing conversational business to transactional business, remember that each approach offers distinct benefits and serves different purposes. Conversational business focuses on building relationships through interactive and personalized engagements. Transactional business, on the other hand, aims for efficiency and simplicity in completing tasks. Here’s a closer look at how these two approaches differ:  

Top 4 benefits of conversational business  

Conversational business isn’t just about quick replies. It’s also about transforming how customers experience your brand at every customer touchpoint. Let’s take a look at the top benefits of conversational business: 

1. Improves retention  

Conversational businesses excel at crafting personalized, one-to-one engagements. With 63% of customers now expecting personalized interaction as a standard service, the ability to address concerns instantly through live chat or messaging apps plays a pivotal role in retaining customers. You can proactively enhance customer satisfaction and loyalty by resolving issues swiftly before they escalate.  

For instance, a coffee chain might leverage its mobile app to send personalized offers, real-time order updates and tailored messages based on previous purchases. This not only keeps users engaged but also provides a direct customer service channel to handle common issues — such as checking order status — before they turn into more significant problems like delivery delays. This personalized interaction fosters a stronger customer connection, preventing customer churn and driving repeat visits. 

2. Enhances loyalty 

Personalized, human-centered customer interactions lie at the heart of customer loyalty. You cultivate trust when you use conversational channels like messaging apps or social DMs to offer tailored advice, answer questions and make relevant product recommendations. This engagement resonates deeply with customers, making them feel seen and valued.  

Take a beauty brand, for example, that leverages messaging apps to provide personalized product advice based on skin type, concerns and preferences. Whether through in-store consultations or virtual messaging, offering tailored suggestions helps strengthen brand loyalty. Companies that excel at personalization are 71% more likely to see increased customer loyalty. The omnichannel nature of these interactions reinforces trust and ensures a seamless customer experience across all touchpoints.

Also Read 📕: Your ultimate guide to building customer loyalty in 10 easy ways 

3. Offers upselling and cross-selling opportunities 

Conversational business opens natural pathways for upselling and cross-selling, boosting customer lifetime value (CLV). According to Forbes, the likelihood of selling to an existing customer is as high as 60%-70%, compared to just 5%-20% for new prospects. 

For example, an e-commerce store might use a chatbot to recommend complementary products based on a customer’s browsing history or shopping cart. If a customer is purchasing shampoo, the chatbot could suggest a bundle that includes conditioner and a hair mask, simplifying product discovery and making the buying process smoother and more rewarding. This frictionless experience elevates the customer journey while driving revenue through relevant, timely suggestions. 

4. Reduces abandoned carts 

Customers abandon their online shopping carts because of uncertainty or confusion, often about product details or shipping options. You can instantly address customer concerns by providing real-time assistance through chatbots or live agents during checkout, leading to fewer abandoned carts. This is why service teams are heavily investing in conversational AI, with 69% of new investments focused on understanding and mapping customer journeys. 

Bonus Read 🛒: How to reduce shopping cart abandonment with live chat 

How to get started with conversational business [+Tips] 

Adopting conversational business strategies can elevate the customer experience journey, from awareness to retention. You can foster stronger relationships and increase customer satisfaction by making interactions more personal, timely and engaging. Here’s how you can start leveraging conversational tools and maximize their potential at each stage of the customer journey: 

1. Awareness 

At the awareness stage, potential customers discover your brand for the first time. The key here is to demonstrate that you not only understand their needs but can also effectively solve their pain points. Establishing a positive first impression is crucial and conversational tools can play a major role the moment a potential customer visits your site.  

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2. Consideration 

Once potential customers become aware of your brand, they compare options to see which solution best fits their needs. This stage is critical for building trust and positioning your brand as the ideal choice.  

Conversational business tools, such as AI-driven chatbots or live chat, can play a pivotal role here. These tools can engage customers by answering specific questions, providing personalized product recommendations and offering deeper insights into your offerings. Use them to share tailored testimonials, side-by-side product comparisons, or relevant case studies that speak directly to the customer’s pain points and business challenges. 

Additionally, conversational tools can provide hands-on guidance by walking new users through setup processes or explaining product features in detail. This proactive support builds customer confidence and reduces friction, ensuring potential buyers feel supported and empowered as they move closer to making a decision. 

Source 

3. Purchase 

When customers are ready to purchase, conversational tools can simplify decision-making and eliminate friction. These tools address last-minute concerns, provide guidance and streamline checkout. For example, a conversational bot can assist with navigating payment options, applying discounts and even redirecting customers to their order tracking page once the purchase is complete. 

🎤 Be a conversationalist 

The essence of conversational business lies in making interactions feel as natural as speaking to a human. To achieve this, avoid using conversational applications that rely solely on rigid, pre-programmed responses to simulate conversation. Instead, invest in an advanced conversational AI platform that dynamically handles customer requests, even after interruptions, creating genuinely human-like experiences.  

To achieve this level of seamless customer interaction, Sprinklr offers powerful conversational AI software designed to deliver dynamic, personalized experiences at scale. With Sprinklr's conversational AI, your business can automate real-time responses, handle complex inquiries and ensure conversations remain fluid across every channel—even after interruptions. 

SEE CONVERSATIONAL AI IN ACTION 

4. Retention 

Customer retention is one of the most significant challenges businesses face in today's competitive landscape. Keeping customers engaged after purchase requires more than occasional updates; it demands continuous, meaningful interactions that show customers you're invested in their success with your product.  

Consider a common retention challenge: customers who stop engaging with a product after the initial purchase. Many businesses struggle with re-engaging these users, often resorting to generic emails or promotions that fail to spark interest. A smarter approach is leveraging conversational AI to tailor interactions based on customer behavior dynamically.  

For example, if a customer purchases a smart speaker from your brand, the journey doesn't stop there. Using conversational AI, you can follow up with personalized setup tips, suggest ways to optimize sound quality based on the customer's environment or even offer advanced features they may not have explored. These follow-ups aren't just transactional — they're part of a deeper relationship-building effort that shows customers you're there to help them maximize their product experience.  

Beyond individual follow-ups, conversational tools can guide users to exclusive online customer communities, where they can interact with fellow users, share tips and receive additional value from your brand. These forums provide a platform for customers to feel more connected to your ecosystem, increasing their likelihood of staying engaged.  

🤝 Conversational businesses are incomplete without community 

Investing in an online community can significantly enhance your customer retention strategy. By providing a dedicated space for customers to engage with fellow users, your brand fosters an environment where they can troubleshoot issues, share experiences and even innovate together. This collaborative atmosphere strengthens customer connections and empowers users to find solutions in real time.   

Sprinklr’s community forum software enables your moderators to join community discussions, offering expert insights and facilitating meaningful conversations. This human touch elevates the community experience, ensuring customers feel supported and valued.  

Sprinklr’s integrated chat option also allows users to contact your support teams directly from the community forum. This seamless access to assistance means customers can quickly resolve their concerns without leaving the conversation, enhancing their experience and loyalty to your brand.  

Let customers meet, interact and innovate together through community forum software. 

Schedule Demo 

5. Loyalty or advocacy 

Since it’s more cost-effective to keep your current customers than to find new ones, you should do everything possible to retain them. Loyal customers are your best brand advocates.

Conversational business provides a unique opportunity to nurture these relationships. By staying connected through real-time interactions, you can celebrate milestones, offer rewards and make customers feel truly valued. For example, sending personalized follow-up messages, exclusive offers, or even celebrating anniversaries through chat or email shows customers you care. 

Moreover, using conversational tools like AI-powered chatbots, you can effortlessly maintain these touchpoints, ensuring that loyal customers feel recognized and appreciated at every stage. This continuous connection strengthens their bond with your brand, encouraging them to advocate on your behalf. 

How Sprinklr enables conversational business

The shift towards conversational business is more than just a trend; it has become necessary in today's landscape of automation and digital tools. Customers crave instant, meaningful interactions and brands that deliver these experiences are the ones that thrive. This balance between innovative technology and authentic engagement cultivates trust and loyalty.  

Sprinklr Service empowers businesses to respond to customer inquiries and anticipate and exceed expectations. With tools designed for collaboration and seamless communication, Sprinklr promotes a two-way dialogue that resonates with customers every time they reach out.  

To discover how Sprinklr can transform your customer interactions, schedule a demo of Sprinklr Service today and take the first step towards redefining your brand's engagement strategy. 

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