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Conversational messaging platform iAdvize raises $38M to expand to the U.S.

iAdvize offers answers via chatbots as well as through its community of 12,000 experts

Financial trends and news by Steven Loeb
October 23, 2017
Short URL: http://vator.tv/n/4a69

For all the money that online merchants invest in getting traffic, a fairly low amount of people actual wind up buying anything. On e-commerce sites, the conversation rate hovers around 2 percent. Why is that number so low? Nicolas de Rosen, Vice President of US at French conversational messaging platform iAdvize, told me that its because so many websites simply aren't very good at assisting their customers with the buying process.

"When you dig deeper, and try to understand why people are not buying, one of the main reasons is that visitors have questions or doubts. If they don't find the answer they are looking for in five minutes, they leave go to somewhere else," he said. "The number one problem is that visitors need advice. They need quality advice in real time."

That the problem that iAdvize is solving by offering companies a human/bot conversational marketing platform, one that can answer the questions that customers have as they are shopping to help them make their purchase.

On Tuesday, the company announced that it has raised a $38 million Series C round of funding from Idinvest Partners, Bpifrance via Large Venture and Quadrille Capital.

This round brings its total funding to date to $56 million. Previous investors included Alven Capital, Iris Capital, Ambition Numérique, Kima Ventures.

How it works

Founded in 2010, iAdvize offers companies the chance to respond to their customers in three potential ways: via a paid advocate members of the iAdvize community, called ibbü; a chatbot; or by the company's own customer service team. 

"The opportunity we see with this is that messaging, as in WhatsApp, Messenger and all of the other applications, are being adopted by consumers worldwide. Today there are three billion people who are active users on messaging, which is 50 percent more than social networks. On one side you have visitors that need advice, on the other side you have consumers who are increasingly using messaging," said de Rosen.

"So, what we are doing with conversation marketing is combining both to enable brands to deliver value through conversation."

Here's how it works: if someone goes to Best Buy's website to buy a laptop, for example, the first thing that iAdvize's technology will do is analyze the customer's behavior in real time in order to predict if that customer is likely to leave the page. Once it determines that, Best Buy will then be able to engage with the customer through a number of channels including Messenger or WhatsApp or through the website. The third step involves connecting the customer to the best respondent, which will be able to answer customer's question.

Which of the three potential agents the customer talks to will depend on what their question is. Questions typically break down into three categories: first are questions about product discovery, meaning doubts about the product they are going to buy. These are typically best answered by experts in the peer to peer community, which will either be an existing customer of the brand or someone who is passionate about the product. 

Second are questions about the brand's business practices, such as inquiries about shipping fees. These questions are best answered by bots, since they are redundant questions and, as de Rosen put it, bots "reach their limits quite quickly."

Finally, there are questions about what happens after the sale. For example, the customer bought a laptop and they want to know the status of their order, or they want to cancel it. In this case it makes the most sense to talk to an in house agent, or someone who works for the company, who would be able to know the store policies. 

There's also the possibility of customers talking to a mix bots and agents; in these cases, the bots will ask the basic questions and then route the customer to an agent who already has the most important information. 

Currently, around half of the questions being answered are around product discovery, while 25 percent are about business practices and the other 25 percent are after sales questions. 

A community of experts

The ibbü community is what sets iAdvize apart from others in this space, de Rosen told me, noting that having these experts on the platform is what has allowed the company, which is currently used by 600 businesses across 60 different countries, to be so successful.

To wit, it has added more than 50 companies in Europe in less than a year, including Sardegna.com, Cdiscount, Point.P, ManoMano, EDF, Mister Auto, Materiel.net, Voyages-sncf.com or IKKS.

"We are tapping into the gig economy. When you go to buy that laptop, your question is going to be sent to an expert who has been sourced and certified by iAdvize as being someone who is passionate about computers, someone who knows everything there is to know, who probably spends his evenings and weekends playing games online, who goes on blogs, or who reads about the latest processes," de Rosen explained. 

"That person is going to receive your question through his smartphone or desktop and, in real time, he is going to assist you in picking the right product."

The company currently has 12,000 experts in numerous fields, which it finds on behalf of its customers. The experts are certified by iAdvize to make sure that know about the topic that they will be assisting customers with. They are also trained to know the business practices of that particular brands to best help the customer. The experts are then paid by the brand on a revenue sharing model.

Though it uses both machines and real people, one thing that iAdvize does not do is try to pass off a bot as a human being. 

"We believe it is very important to be transparent. When bots first appeared a few years ago, brands were trying to make believe that they were humans, but this created a very frustrating experience and, today, most leaders in the industry agree that it's important to be very transparent and to not pretend that the visitor is talking to a human," said de Rosen.

"In the case of the independent experts, it's important to highlight that because it will generate more value. If the visitor knows that he's talking to an independent expert, he will be less defensive and more receptive to the message that the brand is trying to get across. So it's actually a good thing in terms of value generation."

Over 100,000 customers interact with the ibbü community every month, and the customer satisfaction rate is over 90 percent. 

Coming to America

This new Series C funding round will enable iAdvize to grow its global staff to over 250 by 2020, up from the current number of 190, growing teams in London, Düsseldorf, Madrid and Nantes. It will also bolster its research and development resources for core products and services.

Most importantly, the company will be opening an office in Boston, its first in the United States. The office will be headed by de Rosen. 

"We believe the opportunity is right for this expansion because we have a product that is robust and mature and has a unique selling proposition. That community is something we deployed in Europe about two years ago; it's been generating strong growth and traction. We believe that the product is robust enough to go into the U.S." he said.

"On top of this is the fact that we've just raised that significant funding round means that we have the support of our investors to have aggressive growth. The plan is for the U.S. to become our number one market by 2020, so this is definitely our number one priority in the coming years."

By next year, iAdvize is looking to have a team of 10 people in Boston, and 40 people by 2020. 

The iAdvize vision

While many have a vision of bots and AI eventually automating all aspects of human life, iAdvize doesn't view it as a replacement. Instead, sees that technology as another tool to help humans do their jobs better. 

"We believe that bots and AI are a solution but that it's important that brands keep a degree of authenticity in the relationship with their customers. This implies having a human touch somewhere in that relationship. So, our vision is not that AI is going to replace humans; it's that AI is going to be an extension of humans, to make agents super powerful. What we are building is an exoskeleton for the agents or for the experts."

That will allow agents to handle large volumes of conversations at the same time. For example, the company has a feature called Smart Answers, so that when an agent is having a discussion with a customer, the technology can analyze the question to understand the meaning behind it, and then search within thousands of discussions to find the conversations that provided the best value to previous consumers. It will then suggest to the agents some potential answers, and the human can pick which one works best, or ignore those suggestions entirely. The technology is assisting the human, but there's no requirement to even use it if it doesn't apply. 

This type of solution, de Rosen said, can eventually be applied to a slew of different industries, including tourism and education. 

"We want to define the rules of this new industry, and to be the Uber of the customer experience. That's an expression that's been overused but that's where we are heading."