ARTIFICIAL INTELLIGENCE: Chatbot Zombies in a Consumer Wasteland

Source:  Digit

Source: Digit

Conversational interfaces are one of our most watched platform shifts. With (1) Amazon's sales of Echo devices exceeding expectations and 30,000 Alexa skills built by a growing developer community, (2) messaging app Telegram launching a $1 billion ICO, and (3) Apple about to enter the smart device market, it seems that voice and chat are strong theses about the future. But could we be wrong?

In an eye-opening interview with, Digit founder Ethan Bloch talks about his conclusion that chatbots are overrated. As a reminder, Digit is a mobile-first app that focuses on automated savings using a chat interface, one of the top apps in mobile finance. This company bet heavy on chat as the native interface for Millennials, similar to Lemonade doing the same for insurance. His argument that designing for chat-first actually created more work for the user, and that the messaging experience is like a frustrating DOS command prompt. Bots are just not smart enough to hold a conversation. In response, Digit will adjust its design closer to an app with simple menus, rather than a chatbot that doesn't understand you.

And yet. TD Ameritrade is launching trading functionality through a chat interface on Twitter, using direct messaging. Or see SoftBank building conversational capabilities into its physical robot, Pepper. Bank branches full of Pepper bots are already in the wild (i.e., in Canada). So how should we make sense of the growing number of smart devices that can remember faces, understand emotions, speak with users, and support branching decision trees of financial account actions -- and the conflicting first hand experience of the entrepreneur who tried it and says it doesn't work.

The answer is always with the customer. Just like you can't sprinkle Augmented Reality on a complicated user experience and hope for magic, you can't add chat to a well-designed experience and make it less well-designed. The reason Digit works isn't because it can talk back to you, but because it does the homework of automated savings. Bots should do the financial homework, not just talk about it.