The Future of Conversational Experiences

Overview

This is the second in a series of linked posts exploring the future of Experience Design. These posts will look at the types of experiences, projected technical developments and adoption patterns over the next five years. They will also include a list of resources and emerging best practice guides for each of these experiences. The series will finish with some broader thoughts about the nature and future of experience design and it’s relation to other design and strategy disciplines These posts are a work in progress, the next five years is going to see a series of huge changes, many of which are just coming into view and there’s no right answer, so please get involved, add comments, refine my thought, disagree, etc.

Conversational Experiences

Overview

There are two main different, though related conversational interfaces:

  1. Voice; and
  2. Text based chat.

Both can be seen as two sides of the same coin with voice the natural conversational interface and chat its visual counterpart. Both chat and voice interfaces have been with us for a long time. It is only recently, however, that both have reached mass mainstream audiences. This is because the AI technologies that underpin both voice recognition and chatbots have made significant jumps forward which has in turn significantly improved the accuracy and quality of the experiences.

Voice

Voice control of computers, homes, etc, has long been a staple of tech and futurist visions.. The idea of being able to control and interact with your environment using just natural language is a compelling one. As a consequence lots of work has been done on voice recognition over the years. However, it’s only recently that the the technology has reached mass mainstream audiences in the form of Siri, Cortana and Alexa.

Text

The continued rise in the popularity of chat has seen developers push and expand capabilities beyond the simple exchange of messages. In Asian markets, where chat is a much more popular application, driven in part by the high carrier and SMS costs, applications have become the gateway to access a huge range of services. For example, WeChat in China lets users book taxis, reserve doctor appointments, check in for flights, buy cinema tickets, manage bank accounts and a host of other applications. We Chat is no longer just a chat application, it’s also a payment giant. And the last year has seen similar development in US and European markets – e.g. Uber’s integration with Facebook messenger was the first of a range of payment and other services Facebook has been integrating with its Messenger app.

Chatbots are not a new phenomena. However, the explosive rise of mass market consumer of chat applications like What’s App and We Chat along with advances in AI and Machine Learning are starting to move chatbots into the mainstream.

2016 saw the launch of over 900 chatbots with a diverse range of applications.

The Technology, Market and Adoption Over the Next Five Years

The next three-to-five years will see significant reliability improvements in underlying voice and chat technologies, with current barriers to voice adoption falling away. This will significantly grow the market size moving voice and chat from being applications to platforms that cross a huge range of services and use cases, and offer new forms of value exchange.

Improved Reliability of Technology

Reliability is one of the main reasons still inhibiting mass adoption of the conversational technology. It’s obvious to even casual users of Siri or Cortana or followers of Tay the infamously racist Microsoft chatbot, that these systems still have significant limitations. Chatbots currently have fail rates of around 40%, i.e. 4 out of 10 requests cannot be processed satisfactorily.

However, over the next three-to-five years the reliability of the voice recognition and chatbots will improve significantly, driving adoption of conversational interfaces by mass mainstream audiences.

In 2013, Google’s voice platform had a word recognition accuracy rate of below 80 percent, in 2015 that had risen 90%. Baidu now claims a 95 percent accuracy rate, with their Chief Scientist, Andrew Ng, believing that they will soon be at 99-percent accuracy. Ng believes this is a game changer, which will move voice from the early adopters into mainstream everyday use. And it’s a similar story with chatbots, with AI and machine language significantly improving their reliability over the next three to five years.

Adoption Patterns – currently barriers to voice usage will fall away

Voice is already a mainstream behaviour for surprisingly large, particularly young, demographics: in early 2016 Google revealed that 20% of mobile search queries are voice searches and there are a range of other current use cases where voice plays a significant part, e.g. luxury and premium cars. However, mass mainstream audiences have still not adopted voice technology, there are two reasons for this:

  1. Voice technology isn’t quite as seamless enough for mass mainstream audiences; and
    2. Cultural – mass mainstream audiences – particularly older demographics find the experience uncomfortable.

New more reliable technologies will change this with mass mainstream audiences adopting at home and in car voice technologies. This will in turn erode the cultural barriers, e.g. embarrassment at speaking to a computer to uptake.

Adoption will be driven by improved technology which will increase the number of viable use cases, which in turn make the application more compelling to wider audiences.

In the next three-to-five years voice will become a much more mainstream technology. Indeed, it may well be, that in certain settings it will become the predominant means of interacting with technology – e.g. cars and possibly the home.

Markets Grow Rapidly

The global chatbot market is predicted to grow rapidly over the next three-to-five years. With growth running at over 30% a year taking it from roughly a $100 million market in 2016 to a $1Bn market in 2024.

And it’s the same with voice, with similar significant market growth over the next three-to-five years.

Amazon sold 8 million Echo units in 2016, by 2020 it will be selling over 40 million of the units per year. Google is predicted to sell over 15 million a year of its similar device by 2020.

The whole of the Intelligent Virtual Assistant market, which overlaps both voice and chat, will be worth $3bn by 2020

Time spent with chat apps is growing with Kik, one of the most successful chat apps in the US reporting that it’s 300 million users spend an average of 12.7 minutes in a chat session with about six separate chats a day. This represents over an hour and a half spent with chat for the average Kik user And while that statistic is skewed by teen “super users” who comprise about 10 percent of the overall user base and spend more than two and a half hours every day on the app, it’s clear that chat is now a major competitor for user attention.

Conversational interfaces were very hot in 2016, as they rolled out there’s been a predictable bot backlash. Most technologies go through a similar Gartner hype cycle, and while current capabilities and implementations have been over hyped and over sold it’s important to look beyond early implementations and hype. Conversational interfaces are here to stay, both voice and chat will become much more pervasive means of interacting with technology.

Impacts: Voice and Chat become Platforms

Until recently, voice and chat have been viewed primarily as applications, i.e. closed stand-alone experiences. In the last 18 months Facebook, Amazon and Google, We Chat and others have started promoting both chat and more recently voice as much more broadly-based platforms: opening up APIs and doing a range of deals with third parties to integrate both technologies into third party applications.

Facebook announced at a new open Bot platform for Messenger at F8 in 2016. At CES 2017, Amazon unveiled what it calls an Alexa Everywhere strategy – with a push to integrate its voice platform into as many third party devices as possible.

And a whole new slew of start-ups have appeared to build on the new chat ecosystem with new technology platforms like Wit.ai for AI and natural language, Beep Boop for hosting and Slack integration and dozens of others.

It’s too early to tell which provider or providers will become dominant in each space, however, the move from applications to platforms will be very helpful for experience designers looking to create more seamless experiences across different touchpoints.

The Pragmatic View

More conversational interfaces will widely adopted by mass mainstream audiences over the next five years. However, issues with reliability will remain for several years at least and experience designers will have to carefully consider use cases and the fail safes.

Some very grand claims have been made about the impact of conversational experiences, for example;

“Chatbots are the new apps.”

Satya Nadella, CEO Microsoft

However, while it’s certain that chatbots and voice will be much more significant components of experience design over the next five years, there are a number of good reasons why chat will probably not kill apps or websites, anymore than apps or social media killed websites. What they will do is improve and replace certain aspects of a customer journey.

The next post in this series looks in more detail about Designing Conversational Experiences.

 

 

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