Smith Brain Trust / June 21, 2022

Third-Party Apps for Brand-Customer Interaction, Smith Expert Gives Pros and Cons

Third-Party Apps for Brand-Customer Interaction, Smith Expert Gives Pros and Cons

Convenience is invaluable for both sides in business-customer interaction. Thus, companies increasingly are integrating live chat and messaging – an advancement from voice and email – into the customer service channel mix. Third-party apps facilitate and fuel this trend. “The top three apps (WhatsApp, WeChat and Facebook Messenger) each have more than one billion active daily users, making them seemingly indispensable for brands to engage with their customers," says Bo “Bobby” Zhou, associate professor of marketing at the University of Maryland’s Robert H. Smith School of Business.

In a recent piece by Destination CRM exploring the trend, Zhou, further notes that “customers do not need to visit a brand’s main webpage to engage with it. And from the brand’s perspective, the costs of developing and maintaining a presence on third-party messaging platforms can be lower than operating their own online stores, giving brands extra incentives to rely on these messaging platforms.”

In addition to ease-of-use and lower costs of maintenance, consumers can instantly share their positive experience with the brand on the third-party platform, Zhou says. “This is more effective than traditional advertising." On the other hand, “this also means greater pressure on the brand's side in terms of how to deal with consumers' requests.”

Third-party messaging, moreover, means a loss of full control over the interaction with consumers.

“There’s a potential loss of rich behavioral data (depending on the agreement between the brand and app),” Zhou warns. “And consumers use third-party messaging apps around the clock. If a brand establishes a presence on these platforms, consumers will have much higher expectations on the speed of response compared to the typical ‘9-to-5’ expectation on the brand's website. This clearly increases the costs of operation.”

Should your business implement a third-party messenger? “For a company looking to increase its user base, integrating customer service into a messaging platform may be a good choice, considering the low development cost and the advantage of acquiring new customers within the platform,” Zhou says. “By contrast, if the company already has a very established business, and its goal is to strengthen its brand effect, then integrating into a messaging platform may be harmful. This, he adds, is due to the diminished control over the customer interaction and data, plus the “consumers' attitude towards the firm will partially depend on the platform.”

Perhaps most significantly, “if a company decides to integrate third-party messaging into their customer service mix, it needs to be prepared to stay there for a while,” Zhou says. “Pulling out in a short time window would be a classic PR disaster.”

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