The commonly accepted definition of a small business is one with fewer than 50 employees and annual revenue under $7.5 million.
This definition no longer holds true, though, as today it's common for businesses with fewer than 10 employees to generate $10 million or more in revenue. How? They leverage the right technology to automate time-consuming manual processes that enable a small team to scale, serve, and retain a vast customer base.
One of the most impactful technologies with the quickest time-to-first-value for small businesses is chatbots, which are now powered by AI. They help them manage, automate, and streamline their engagement strategy, from marketing and sales to customer support and success. This article will explore how small businesses can develop and deploy a custom chatbot strategy for better and measurable returns.
Key takeaways
- Chatbots streamline customer engagement: By helping small businesses stay available 24/7, respond instantly, and manage interactions across channels.
- Automation drives efficiency and savings: By handling routine tasks, chatbots reduce operational costs while maintaining a high-quality customer experience.
- The right chatbot accelerates growth: Easy setup, integrations, and analytics enable small teams to scale support, sales, and retention with measurable results.
Benefits of chatbots for small businesses
With AI powering chatbots, they're no longer static dropboxes for one-way communication, but truly an engagement enabler across customer touchpoints. For small businesses, this means streamlined interactions across channels, faster responses, and the ability to scale operations without adding headcount.
24/7 availability
Small businesses often lose customers who reach out outside their business hours, as they can't be available all the time with a small team. Chatbots solve this, as they're available round the clock and can provide instant responses. Whether it's a sales inquiry at midnight or a weekend support request, businesses can still be accessible to their prospects and customers.
Generate leads, move sales funnel faster, and provide instant support
Being available all the time prevents small businesses from missing opportunities they can't afford to let go. By instantly engaging with website visitors, chatbots help them generate leads, qualify them based on their activities, and pass them to the sales team with contextual information for faster conversion. Even after the conversation, chatbots can help customers onboard the product/service and provide instant responses and resolutions when needed.
Decreased operational cost
Since chatbots enable small businesses to automate their routine queries, lead qualification, support operations, and even onboarding tasks, this helps the business stay lean and provide an uncompromising engagement experience, all while decreasing their operational costs.
Personalized experience, boosting trust and loyalty
AI-powered chatbots level the playing field by enabling small businesses to provide personalized experiences similar to enterprises by tailoring recommendations, remembering preferences, and providing seamless support. This nudges prospects and customers alike to build trust, strengthens loyalty, and encourages longer retention.
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Chatbot use cases for small businesses
While the benefits of AI-powered chatbots are clear: 24/7 availability, reduced costs, faster conversions, and better customer relationships, how can small businesses incorporate these benefits into their day-to-day operations?
Automate availability
With chatbots, small businesses can attend to queries and provide resolutions around the clock, ensuring your business stays accessible even after business hours.
Schedule appointments and meetings
Small businesses can offer the option to schedule appointments and manage bookings from within the chatbot interface, which will reduce drop-offs. Chatbots can also be configured to send meeting confirmations and even reminders to reduce no-shows.
Onboard and walkthrough
Chatbots can provide personalized and scalable hand holding to new customers through their onboarding journey, feature, and use case walkthrough, as well as share helpful resources when needed.
Instant responses and resolutions
Chatbots can handle repeated, mundane questions (like pricing) and share responses for status queries without having to depend on human agents. For support queries, by taking information from the associated resources and articles, chatbots can answer simple questions.
Collect feedback
At the end of every conversation, chatbots can ask for quick feedback on whether their answers have been helpful. This will help small businesses gather insights, analyze data, and improve their services. Businesses can also use that feedback as marketing collateral in place of testimonials to build their credibility.
How to choose the right chatbot for your small businesses
With a plethora of chatbot options available, it's a hard task to identify the right one, especially for small businesses who can't spend much time on configuration and figuring out how things work. They'll need something they can implement right away and see value. From easy setup and integration stack to advanced AI features, here are the essentials to look at while choosing the right chatbot.
Easy setup and low maintenance
Time-to-first-value is a metric small businesses would be looking at while they're evaluating chatbot options. I.e., how fast they can move to deployment to see the results. They don't have the luxury enterprises possess, so the chatbot should be simple to set up and quick to deploy with minimal upkeep.
Integration capabilities
Though small businesses would be using a handful of tools, the chatbot should be able to connect seamlessly with their tech stack. This will help them make all the information accessible to the chatbot, avoiding siloing, and ensure data flows across the organisation without needing manual checks.
Omni-platform adaptability
The right chatbot should be able to function on all the platforms on which small businesses are active. From their website to mobile applications, to all the social media and instant messaging platforms like WhatsApp, Instagram, Facebook Messenger, etc, the chatbot should have the omni-platform adaptability for deployment. This way, it'll act as an unified platform for all the customer communication irrespective of the channels their customers choose to engage.
Analytics, automation, and AI functionalities
The right chatbot doesn't stop at answering questions, because that's just the first layer of business engagement. It should also provide automation capabilities to scale your workflow, insights into its performance, and information on what else you can do to improve it. Of course, there are AI capabilities to track user behavior, identify usage patterns, and create personalized interactions. These functionalities will help small businesses refine their engagement strategies constantly and optimize for better customer experience and satisfaction.
How to implement a chatbot for small businesses
Knowing what's needed in a chatbot for small businesses is just a start. The actual impact is in how it's put into action. By understanding the needs and the behavior of your users, align your chatbot strategy with your business goals and follow a structured approach. Here's a step-by-step process to look at how to do this efficiently.
1. Identify the use cases and goals
Start by listing the use cases you want the chatbot to handle as it'll give an idea of what is and isn't needed. Once the use cases are locked in, define your goal with implementing the chatbot as it'll help in arriving at the measurable business outcomes. Put simply, it's setting the expectations so we can identify if we're going in the right direction or not.
2. Identify the platforms/channels to deploy and the needed integrations
Identify the channels/platforms your users access to interact with your businesses the most, be it your website/mobile apps, social media/instant messaging applications, etc.. Also, identify the integrations needed for the chatbot to work seamlessly without any data siloes as it needs permissions to access data across the organization.
3. Map the use cases with workflows
After defining the goals and identifying the channels to deploy, create new workflows if needed or map them to the existing flow. It'll keep the chatbot aligned with the business outcomes.
4. Design the conversation flow, test in a sandbox, and deploy
Once the infrastructure is ready, create a conversation flow simulating the real customer issues and queries, and test it in a sandbox environment to understand how it performs. Identify the friction points and gaps if any, refine the flow, and iterate. A/B testing can also be done to understand what works better for your business. Once satisfied, the chatbot can be deployed.
5. Monitor, measure, tweak, and repeat
After deploying, monitor and measure the performance metrics that align with the business goals. Get the insights and analyze what can be tweaked to better the conversation flow and continuously improve the chatbot's impact.
Chatbot metrics small businesses should track
Response time
Response time is the average duration between the customer initiating a conversation and when the chatbot replies to them. A lower response times indicates that the business attends to customer queries and needs fast.
Resolution time
Resolution time measures the total time taken by the chatbot from the first conversation to a successful resolution. A lower resolution time highlights the efficiency of the chatbot as it's able to provide resolution quickly.
Deflection rate
Deflection rate measures the percentage of chatbot queries handed off to human agents as they weren't resolved by the chatbot. It also helps small businesses measure the direct reduction in human support load.
Saved operational cost
Saved operational cost tracks the cost saved by using the chatbot to handle user queries that otherwise would've been handed off to human agents.
CSAT (Customer SATisfaction score) and NPS (Net Performer Score)
CSAT tells how satisfied customers are with their interaction with the chatbot. NPS is calculated by asking users how likely they are to recommend the business to others. Higher CSAT and NPS scores indicate the customer satisfaction and the long-term trust.
Zoho SalesIQ, the best chatbot builder for small businesses
Zoho SalesIQ, a customer engagement solution, features an extensive chatbot builder that's ideal for small businesses.
Bot templates: Bot templates mean small businesses don't have to build a bot from scratch. From the templates library, they can select the industry where all the associated use cases are already added and deploy the flow bot within minutes. It doesn't require any technical know-how or complex configurations. It saves on building costs and time and can be deployed faster.
Manual coding option: If the business requirement is complex, SalesIQ also has the option to code the bot completely from scratch to achieve the use cases.
Answer Bot: For answering repeated and mundane queries, SalesIQ has Answer Bot, which is an AI bot powered by Zia LLM. Small businesses can associate their knowledge base, articles, and other resources, and the Answer Bot will pull the answers and share them with the users for resolution. If they want to have both the flow and Answer Bot, SalesIQ has the option to achieve this via a hybrid bot.
Messaging channels: Since instant messaging/social media platforms have become an integral part of every business, the created bots in SalesIQ can be deployed to WhatsApp, Facebook Messenger, Instagram, Telegram, and Line to unify communication and reduce the waiting time.
Multilingual capabilities: The bots also support more than 35 languages. If the small businesses cater to a global audience, they don't have to worry about the language barrier and can provide a personalized engagement experience.
AI integration: SalesIQ also offers direct integration with OpenAI. If businesses want to combine their bots with ChatGPT for answering queries, they can do that as well. With the ChatGPT assistant, personalized conversational responses are also possible.
If you'd like to learn more about how SalesIQ can help your small business, book a demo now, and our experts will walk you through the platform. If you'd like to explore the platform firsthand, sign up for a complimentary 15-day trial—no credit card needed.
FAQs for chatbots for small businesses
Are chatbots too expensive for small businesses?
Not at all. Chatbot platforms like Zoho SalesIQ offer affordable plans for businesses of any size, including SMBs. The Basic plan starts at $7/month (billed annually) and includes pre-built templates, a drag-and-drop builder, and deployment across social channels and mobile apps.
How does a chatbot handle complex customer questions?
Chatbots handle complex questions using NLU and NLP to understand intent and context, pulling answers from your knowledge base and resources. If a customer needs more help, the chatbot can instantly route the chat to a live agent for seamless support.
How does a chatbot improve response time for customer queries?
By being available 24/7 and handling multiple queries simultaneously, chatbots reduce wait times and provide instant answers to customers. By managing repetitive queries, chatbots not only improve response time but also shorten the overall resolution time.
Will a chatbot work outside of my business hours?
Yes. Chatbots can operate 24/7, responding instantly, collecting information, and sharing resources even when your team is offline. This ensures consistent support across time zones, improving satisfaction and reducing missed opportunities.