LOS ANGELES — Forget about apps. The technology that's really embedded itself into people's lives is messaging. Within a couple of years, according to The Economist, 3.6 billion people — half of the humans on the planet — will have at least one messaging app on their smartphones. Those non-messaging apps? Quettra Research says that 95 percent of them lose their users within 90 days.
Messaging platforms, meanwhile, are quickly becoming a key way for companies in the U.S. to conduct "conversational commerce" with their customers. Hotels such as Hyatt and ride-booking services including Uber are starting to use them. You can even message your pizza order to Dominos. Can buying a car via chat and messaging be far behind?
Not for Edmunds, which is creating products that leverage messaging platforms, chat and even artificial intelligence to make car shopping easier for consumers and car retailing more efficient for dealers. It showcased the products Tuesday during a panel at AutoMobility LA, billed as the auto industry's first trade show dedicated exclusively to automotive technology and the mobility movement. It takes place during the media days preceding the LA Auto Show.
"How Messaging, Chatbots and AI Will Transform Automotive Retail" featured Nick Gorton, Katti Fields and Greg Shaffer, leaders of the Edmunds teams that are creating these tools, along with Facebook's Trace Przybylowicz, who leads automotive industry platform projects for the social media giant. CBT News' lead anchor, Joe Gumm, moderated.
As the leading car shopping destination, Edmunds identified texting as a solution for car shoppers and dealers more than two years ago in response to the "massive shift" of car shoppers from desktops to mobile, said Gorton, Edmunds' vice president of product innovation. Edmunds saw that more and more shoppers were researching cars from their phones, but also saw that the volume of leads that its dealer partners received was not keeping pace.
A solution for both sides of the shopping equation came in the form of CarCode, an innovative short message service (SMS) platform that Gorton's start-up developed. Edmunds acquired the company and hired Gorton, and in 2014, rolled out CarCode to its car dealership partners. Within 24 months, 7,000 dealers were using CarCode to respond to shoppers, with the tally of ongoing conversations running in the millions. CarCode allows dealerships to easily begin and maintain a customer relationship that starts with shopping but can go beyond that to license-plate pickup and even service appointments, Gorton said.
Its success was a natural outgrowth of texting's core strengths: Everyone has the ability to text from phones, and it's an easy way to quickly communicate with friends and family. Texting doesn't require anyone to download a special app or learn a new interface. Text is "frictionless" and has a response rate that puts email to shame. Increasingly, platforms such as Facebook Messenger and iMessage are gaining richer capabilities, including the ability to embed photos and videos directly into the conversation, said Fields, Edmunds' vice president of product development. The platforms, she noted, are creating a "new ecosystem of on-demand instant services" right at a consumer's fingertips.
Text communication at scale can be a real challenge for car dealerships, however. Shoppers expect speed and quality in their text interactions, day or night. Technology is the solution, but with a business to run, many dealers have little time to create their own machine learning and artificial intelligence platforms.
Edmund saw the need and is using artificial intelligence technology to develop chatbots for automotive retailing. Chatbots are computer programs designed to simulate conversation with human users over the internet, and now that AI technology has evolved, they have the ability to give a relevant response even if it's a conversation or situation it has never encountered before. The technology uses feedback loops to continuously improve the accuracy of the chatbot's responses.
Chatbots enable the automation of dozens of tasks to help shoppers and save dealers time, from searching inventory and configuring cars to the structuring of leases and the scheduling of test drives.
Greg Shaffer, Edmunds' director of product management, demonstrated Edmunds Lease Bot, a product that the company is developing. The Edmunds Lease Bot is in early live beta tests.
When the user enters a ZIP code or a city to begin shopping, the Edmunds Lease Bot makes a passing comment on the current weather, which supplied by a weather service ("Looks sunny and bright over in Santa Monica"). Then the Lease Bot gets down to business: What kind of car are you looking for? How much do you want to pay each month? It will then show photos of cars in local dealer partners' inventories and present options to view details, specify equipment or schedule a test drive. It even offers tips on how to make a lease more economical.
Why does the bot want to chat about the weather or offer shopping advice?
"We want to pay attention to the 'wow' moments," Shaffer said during a panel rehearsal. Shoppers may know they're working with a chatbot, but Edmunds also wants them to feel that they're getting a conversation that's personal, natural and individual. Just like texting with a friend.