Chatbots are truly exciting because they bring with them the promise of a paradigm change. They make it possible to interact with customers — within a trusted environment — in a way that apps or other channels cannot achieve. What we really mean when we say “utility marketing” is that chatbots offer a way to make sure customer needs are met on the spot.

The idea is that consumers receive value from their exchange with a brand because the brand actually gives the consumer something useful (utilitarian), like directions, content, customer service, tickets, or a piece of helpful information, at the precise moment and in the same channel a consumer requests it.

While it’s easy to get energized about this new opportunity, the only way to make it work is to go beyond the hype to focus on the growing demand for something that is actually useful.

Providing utility in the customer relationship is all about when, where, and how consumers demand something. Traditionally, this demand was met through product planning and innovation — for example, having the latest swimsuit styles available in the summer through the convenience of multiple retail locations. This model has certainly expanded in the digital age, and chatbots provide a real opportunity to take a giant step forward, giving consumers the expanded level of practical benefits they’ve come to expect.

Think about it for a minute. As a consumer, how much utility do the businesses that you interact with provide? Are you asked to download a new app every time you turn around, fumble your way around the company website, or even try to wrangle your way to a live agent at a 1-800 service number? Consumers have been aware for some time that we all walk around with a mobile remote control in our pockets that is an ideal mechanism for delivering true utility.

How chatbots connect the dots of utility marketing

I work with a variety of retail and hospitality brands that are embracing the ability to automate one-on-one communications with their customers because it allows them to give those customers the utility they are looking for. One-to-one marketing, a concept pioneered years ago by Peppers & Rogers, is a customer relationship strategy that emphasizes personalized customer interactions as a means of fostering greater loyalty. Chatbots can play an integral role in automating one-on-one consumer marketing communication, especially when coupled with trusted messaging apps like Facebook Messenger or direct messaging on Twitter.

Specifically, the marketing chatbot approach connects the dots between chat and utility marketing by enabling consumers to interact with a bot using natural language at the customer’s convenience. This gives brands the utility to engage in customer service, ecommerce, marketing campaigns, and other marketing moments – all in a personalized manner. By creating and applying rules that respond to certain natural language communication and connecting personally identifiable data points, companies are able to authenticate, or recognize an individual, and respond intelligently with a rules-based system for bots or deep CRM data for one-on-one conversations.

The ability to create this data link is indeed a critical aspect of providing utility through chatbots. A savvy approach is to create a connection to the organization’s loyalty program. This has a double-sided benefit in that it provides information that enables personalized communication and gives companies the ability to simultaneously reward these customers for their participation, reinforcing the utility and benefit of the interaction. Further, the approach creates a virtuous cycle in which the company’s most loyal customers engage more and more deeply inside the brand’s chatbot.

Chatbots — the new social triggers

One of the common critiques of chatbots is that they leave discovery and distribution in the hands of consumers, putting marketers in yet another “build it and they will come” scenario. However, innovative brands are promoting social triggers like hashtags as a way to simultaneously address this concern and connect offline media — like television, events, and in-store calls-to-action — to their marketing chatbot. By activating campaigns and events in this way, the marketing chatbot converts offline marketing via users’ mobile remote control, effectively connecting consumers’ social IDs with their offline ID while giving consumers greater control over when, where, and how they interact.

With this information on hand, marketers can tie chat identity, demographics, and other first-party data to email accounts in CRM and marketing databases for enriched marketing data and an ability to further personalize chatbots moving forward. Finally, this customer-centric approach also allows brands to proactively surprise and delight consumers, giving marketers the ability to listen to people who are talking about them and respond in a personalized manner. Rewarding people proactively for their advocacy or taking an opportunity to address a potential customer service issue helps create a bond that will further grow customer loyalty and ROI.

The new chatbot paradigm is exciting, indeed. Amidst the hype, however, it will be important to not lose sight of what people really want from the organizations they interact with — e.g., the utility. Marketers that focus on giving people the ability to engage with a natural language marketing chatbot in this way will assuredly increase customer loyalty and grow the lifetime value of the relationship. And at the end of the day, isn’t that what it’s all about? Creating happy customers who want to do business with you.