Chatbots Emerge For Digital Order and Pay

by Raymond Pucci 0

“Hello Messenger Chatbot—I’ll have a large tuna sub, lettuce, tomatoes, pickles, no oil—I will pick up in 15 minutes at Main Street Subway. Please confirm my order Messenger?” This is the new age ordering system announced by Mastercard and Facebook that launched yesterday in 26,000 U.S. Subway stores. According to the following article, other merchants are being added to this machine learning system.

Artificial intelligence is being touted as a tool for addressing some of humanity’s most pressing problems, including climate change and cancer. But starting this week, you can put it to work for something a little more prosaic: ordering a hoagie.

On Tuesday, Mastercard announced it has partnered with Subway and two other major merchants to launch “chatbots,” which are robots that simulate human conversation. The Subway iteration allows you to order a custom sandwich for pickup, something of a digital version of walking down the chain’s sandwich assembly line. There’s another from Cheesecake Factory that allows shoppers to purchase and send out gift cards, and a third from online grocer FreshDirect in which customers can place orders for groceries and meal kits. The bots will be found within Facebook’s popular Messenger app, and will be powered by Masterpass, the credit card giant’s digital wallet.

These big-name brands join a growing group of retailers that are experimenting with how chatbot technology can be leveraged for digital shopping. The debut of the bots will provide a fresh test of shoppers’ appetite for what the industry has dubbed “conversational commerce,” the idea of making a purchase or other customer service transaction through A.I.-powered messaging.

Facebook has said that more than 33,000 bots have been created for its Messenger app so far. This latest batch demonstrates how differently businesses are approaching the technology at this early stage of the game.

This is another play on the increasing popularity of mobile order and pay ahead, only using your voice commands, not keypad entry. Whether consumers takes to this method remains to be seen. However, given the huge Facebook Messenger user base, and the partnership with Mastercard, there should be a sizable early-adopter factor. If order fulfillment is prompt and accurate, plus added value features such as loyalty are added, there could be some lift for this service.

Overview by Raymond Pucci, Associate Director, Research Services at Mercator Advisory Group

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