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Artificial Intelligence (AI) is a technology that will influence the future of many organizations. Schwab (2016) even predicts that AI will help top management make decisions in the future. Sixty-two percent of customers are open to the use of artificial intelligence if it improves their experience (Salesforce, 2019). However, only 33 percent encounter artificial intelligence in everyday use, a relatively low level (Salesforce, 2019).
A technology based on AI and often found in daily use is the chatbot. Chatbots are a technology that integrates modelling language and machine-generated computational algorithms to mimic informal chats between human users and computers, using natural conversational language (Shawar & Atwell, 2005). Today, customers are ready to accept chatbot technology (Morgan, 2017). Chatbot’s capabilities include self-consciousness, purity, humor, emotional quotient, intelligence quotient, memory, self-learning, and charisma (Wei, Yu, & Fong, 2018). The advantages of chatbots for companies are that they can answer routine questions from customers about products or services through an automated customer service process (Almansor & Hussain, 2020), record much customer data (Lasek & Jessa; 2013, Morgan, 2017), give personalized responses and recommendations, meet customers’ demand for 24/7 availability (Morgan, 2017), increase the conversion rate (Lasek & Jessa, 2013), provide accurate and credible communications, and increase customer satisfaction (Chung et al., 2018), and deliver faster responses and higher levels of service performance (Xu et al., 2017). However, former studies have identified several weaknesses of chatbots, such as failing to provide competent communication (Chung et al., 2018), failing to understand conversation as a human does (Lasek & Jessa, 2013), and being capable of manipulating human behavior (Creed & Beale, 2013).
Recently, many customers have been forced to migrate to online platforms to shop. In Indonesia, online shopping has increased from 4.7 percent before to 28.9 percent during the pandemic (Hutauruk, 2020). Despite the many advantages to businesses, online shopping also increases customer demand for 24/7 availability and fast response times. Chatbots can be one of the solutions to meet this demand. The use of chatbots in the marketing sector is widespread, given its potential (Fryer et al., 2019). In fact, luxury fashion brands have adopted chatbots as their e-service agents (Chung et al., 2018). However, studies on the success of chatbots, especially in relation to brand, are still limited.
Just like human service agents, chatbots basically function as representatives of a brand. Therefore, chatbots must also have certain characteristics expected of human service agents, such as being polite, helpful, and trustworthy (Chung et al., 2018), and saving time, giving advice, and simplifying purchasing procedures for customers (Holzwarth et al., 2006). In many ways, customer interactions with e-service agents are similar to those with human agents and can influence purchasing decisions (Holzwarth et al., 2006). However, customer interactions with chatbots have their own characteristics. Hill et al. (2015) compared the differences in communication that take place between humans and between humans and chatbots. They found that customers communicate with the chatbot longer, but that the messages are shorter, and that customers use profanity more frequently. Mimoun et al. (2017) found the effect of individual characteristics on customer e-productivity. Chung et al. (2018) studied the impact of the chatbot’s communication abilities on customer satisfaction and found a significant effect. Ciechanowski et al. (2019) explored differences in user reactions in interacting with text-based and an animated-avatar chatbots. Fryer et al. (2019) also compared human-human and human-chatbot interactions as a student’s partner in learning a language. The study found that success depended on the initial interest of the students in language. All of those studies focused on a specific aspect of customer interaction with chatbots.