18th October 2019
Written by Erica Salowe, Researcher
Edited by Adam Shaw, Associate Partner
As an American student living abroad on a budget, and the exchange rate always favouring the pound over the dollar, I tend to talk myself out of a lot of online purchases. Why buy that £40 hair dryer when a quick stroll through the icy Glaswegian winds can do the job? Why needlessly shell out £70 for a puffy winter coat when layering four sweaters provides just as much padding? And, surely, I could pass on the £30 BRITA filter, channel my inner frontierswoman and tough out that slightly chalky taste in the tap water.
Unfortunately, with the advent of conversational commerce, also known as c-commerce, my frugality is harder than ever to maintain. Brands are quickly learning that gregarious chatbots and other forms of interactive AI are a sure-fire way to gain consumer trust and increase spending.
As opposed to traditional e-commerce, where one has to dig around for her own product and pricing information, c-commerce via chatbots delivers instant information 24/7 with personalised advice on platforms where consumers are already spending a lot of time, like Messenger and Instagram.
The power of conversation can even introduce new consumers into the fold, such as baby boomers, who wouldn’t ordinarily partake in online shopping if they were confused by the interface. While grandma doesn’t know how to browse, she knows how to chat, and AI can help answer all her questions and find what she’s looking for.
What’s the secret to c-commerce success? Well, it turns out people crave highly tailored experiences when it comes to their online shopping. Who doesn’t love a personal assistant that can instantly embark on a 2 a.m. hunt for a KitchenAid 5KSM150 (a stand mixer, in case you were wondering)?
Once people give c-commerce a try, they will likely come back for more, as AI-driven chatbots iteratively learn from customer engagements, store conversational data and personalise offers with subsequent interactions.
Companies like LivePerson are among the first to bridge the gap between consumers and brands, offering a service that builds industry-specific chatbots with pre-configured intents and dialogue flows. These bots can function over platforms ranging from a brand’s website, to Facebook Messenger, and even SMS.
Brian Long, CEO of an SMS-building platform called Attentive, believes that c-commerce is the future for brands. He says that in the next five to 10 years, companies around the globe will adopt c-commerce, and the estimated conversational AI Market will value $15.7 billion.
With those stats, let’s hope I’ll have enough money in the bank to offset my inevitable AI-assisted impulse shopping.
Turkey has agreed to a ceasefire in northern Syria and will allow Kurdish-led forces to withdraw, following a meeting between US Vice-President Mike Pence and Turkish President Recep Tayyip Erdogan. Fighting will be halted for five days while the US facilitates the withdrawal of Kurdish-led troops from a safe zone on the border. While Kurdish commander Mazloum Kobani has said his forces will follow the agreement between the border towns of Ras al-Ayin and Tal Abyad, it is unclear if the Kurdish YPG will fully comply, as he says the “fate of other areas” has not been discussed. Despite the declaration of the ceasefire, the UK-based war monitor Syrian Observatory for Human Rights has reported that clashes continue in Ras al-Ain.
Boris Johnson will give MPs a “my deal or no deal” ultimatum ahead of Saturday’s Commons Brexit vote. Jean-Claude Juncker, president of the European Commission, has ruled out an extension, allowing Johnson to exert pressure on MPs to back the deal. The new agreement does away with the Northern Irish backstop, and dictates that Northern Ireland will remain in the UK customs area. Customs declarations will be placed on goods crossing the Irish Sea, and there will be limited checks on goods traveling north to south of the border.
Knife crime in the UK has risen to its highest level in eight years, driving overall police-recorded crime to a 15-year high. Rural areas in England and Wales have experienced some of the biggest increases, particularly the counties of Bedfordshire, Suffolk, Dyfed-Powys and North Yorkshire. Officials believe the upswing in violence is due to changing drug markets and city gangs “muscling in” on the local drug networks of these rural regions.
Business & Economy
The trade war with the US and softer domestic demand has led to slower Chinese economic growth in the third quarter. A sharp slowdown in the world’s second largest economy could have significant consequences for the global economy, as it increases the risk of a world recession. Domestic issues like the swine fever outbreak have hit consumer spending and fuelled inflation, further exacerbating China’s economic issues.
WH Smith has acquired Marshall Retail Group in the United States in a $400 million buyout. The deal further expands WH Smith’s international travel business following the $198 million takeover of Inmotion last October. WH Smith chief executive Stephen Clarke has said that his successor, Carl Cowling, was the driver of the deal.
US Senator Ron Wyden has introduced legislation that would impose heavy penalties on companies and their executives who do not protect consumer data. The Mind Your Own Business Act threatens to jail executives for up to 20 years if companies are found to be lying about the misuse of Americans’ personal data, with the addition of tax penalties tied to executive salary.
What happened yesterday?
Stocks on both sides of the Atlantic climbed after Boris Johnson reached a Brexit deal in Brussels, and Wall Street received an additional boost from high earnings reports, particularly from Morgan Stanley and Netflix. The S&P 500 advanced 0.3%, bringing the benchmark index within one per cent of its all-time closing high. The Nasdaq added 0.4%.
While UK stocks were in an upswing after a deal was reached, gains were pared amid speculation on how the deal would fare in parliament. The FTSE 100 was up nearly one per cent at point but receded to finish the day up 0.2%.
British Land and Persimmon were the biggest gainers, both rising 3%. BAE Systems is the largest faller, down 3%.
WH Smith was the largest riser on the FTSE 250, which was up 0.5% at 20,301. Its shares rose 9% after it announced the takeover of US retailer Marshall Retail.
After surging to $1.30 on Thursday, the pound balanced out at $1.287, up 0.3% against the dollar.
Whats happening today?
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Final dividend payment date
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Int. Economic Announcements
(09:00) Current Account (EU)
Columns of Note
Writing in The Guardian, Gaby Hinsliff warns climate activists that they must be conscious of their privilege when it comes to where and how they choose to protest, citing a recent incident at Canning Town station. A ‘climate warrior’ climbed on top of a tube train early in the morning, preventing passengers from embarking on their commute and inciting anger throughout the crowd. While the protestor may have been able to afford skipping work for the demonstration, Hinsliff points out that those at Canning Town station on strict punctuality, zero-hours contracts would not be sympathetic to a political point if their shift was cancelled and they lost the means to support their families. She urges the Extinction Rebellion movement not to squander the mass goodwill it has received by maintaining an uncompromising attitude about climate change; rejecting gradualism and tact will only prove counter-productive in the long-run.
The New Statesman’s Stephen Bush writes expresses doubt that Boris Johnson’s Brexit deal will receive parliamentary approval. Bush believes the deal will get the votes of at least three of the four independents who voted it through the last time, but independent Unionist MP Sylvia Hermon remains a wild card. He also predicts the number of Labour votes in favour will be slim, considering the UK-wide backstop will lead to greater deregulation for the rest of the UK. Most importantly, the provisions do not pass muster with the DUP.
Did you know?
Nutmeg is extremely poisonous if injected intravenously.
House of Commons No business scheduled. House of Lords No business scheduled. Scottish Parliament In recess until 22 October.