The State of Chatbots in 2022: A New Revenue Stream for Marketing Agencies?

What now feels like an era ago, marketing agencies evolved from design and print to also include web development. From there, services such as SEO and custom app development rose to fame.

Then, a pause.

Fast forward to 2021 and the desire to do more with less and increase efficiencies, amplified by the recent pandemic, has led to a range of businesses turning their eyes to chatbots and AI.

The majority of businesses lack the in-house skills and confidence to deploy AI and chatbots alone. They want expert guidance and don't trust the do-it-yourself articles found online.

What impact has this had on marketing agencies? Will chatbots as-a-service be the new revenue stream for marketing agencies?

A recent report dived into the subject, surveying marketing agencies across the globe and interviewing industry leaders.

The statistics drawn from the report show that brands are already turning to marketing agencies for advice and guidance.

Additionally, the report's interviews paint a picture of where industry leaders feel the future is heading.

Here, we summarize the results from the report and use them to make data-backed predictions of what the future may hold.

You can grab your copy of the 2022 Chatbot and Marketing Agency Industry Report in full here.

Growing demand with little supply

Between 2020 and 2021, amid a worldwide pandemic, the chatbot market size grew from $430.9 million to $525.7 million. To top this off, the marketing is expecting to see a compound annual growth rate of 24.9% until 2028 (Grand View Research, 2021).

The chatbot market is truly booming, but many of us already knew that.

So, what’s the knock-on effect for marketing agencies?

When surveyed, 68.2% of agencies confirmed their existing clients have shown an interest in chatbots.

With the rise of chatbots, so comes the rise in demand for experts. Marketing agencies are perfectly positioned to fill this demand but many agencies seem slow to capitalize on this opportunity.

The research shows that only 40% of agencies have seen their competitors offer chatbot services.

This creates a huge gap in the market. The faster adopters of chatbots as a service are likely to find a monopoly in their area.

When interviewed on the matter, Jan Golding (lead experience designer at Cohaesus), stated:

Golding touches on the key factor for marketing agencies. The market gap is huge but the flexibility of agencies combined with their employees’ drive to learn makes them perfect candidates for this new wave of chatbot experts.

Marketing agencies see chatbots as the next go-to

The rise in demand for chatbots, both in terms of new business requests and upselling opportunities with current clients, has already sparked ideas with marketing agency key decision-makers.

Nate Horgan (digital advertising strategist at Mean Joe Advertising) said he "could see agencies specialising in only delivering chatbots in the next 5-10 years.”

Additionally, Liam Kingswell (founder of the Norfolk Agency) states “chatbots are great for agencies, it should be a must-have.”

When surveyed, a whopping 91.2% of agencies expect chatbots to become an integral part of business operations. On top of that, 86.6% of agencies believe brands will expect them to be able to assist with chatbots or other AI-related projects.

Clearly, agencies are cottoning on to the benefits that chatbots can provide them as a business.

Chatbots provide access to a new revenue stream and are a great way to expand upon retainers.

It will be interesting to see how quickly agencies start to offer chatbots as a service now the tech and world is ready for them.

Views towards creating chatbots for clients

In contrast to the low numbers of agencies openly offering chatbots as a service, 73.3% of agencies have experimented with chatbot platforms on behalf of their clients.

This portrays the idea that many agencies have put thoughts into chatbots but struggled to find an option they enjoyed.

Martin Betts (Client Services Director at Creative Sponge), mentioned "we found the platform we were using quite clunky. It was very obtrusive. We didn’t have much freedom, we couldn’t set up things the way we wanted. We couldn’t create a user journey, so we took it down."

So, is the demand for chatbots ahead of the technology?

Two to three years ago, when chatbots were truly the buzzword of business, the technology did have a few failings.

The power was there but it was difficult to harness. Chatbot platforms hadn’t yet allocated the time needed towards creating an enjoyable UI for their chatbot builders.

In turn, this has put a few agencies off the technology.

With this in mind, it’s worth looking back at the rise of websites. The first-ever website, still accessible here if you want to marvel at how far we’ve come, was pretty damn poor, as was the initial developer experience.

In time, tools were developed to make creating websites easier. This is a change that we’ve also seen in chatbot platforms. Now, the UI is matching that of other platforms, and the flexibility of these platforms has been improved.

For the agencies that experimented in the past and decided against chatbots, it’s worth having another look. The world moves fast, and it’s not worth missing out on.

How to get started with chatbots

Naturally, diving into natural language processing to create a custom-built chatbot is off the cards for most agencies.

On top of that, open-source projects are often a turn off for clients. Chatbots are capable of collecting a wide range of user data, for many businesses the idea of their data being collected by or passed through a codebase born from an open-source project is a little scary.

So, a greenfields approach isn’t the fit for marketing agencies.

Thankfully, many chatbot platforms now offer partner programmes with varying levels of commitment.

• Affiliate schemes help agencies test the water with their clients.
• Implementer programs allow agencies to offer chatbots as a managed service, maintaining the client relationship while having the safety net of a third-party provider to rely on.
• Finally, white label partnerships let agencies become resident chatbot experts. A quick google search of ‘implementer chatbot partnership’ or ‘white label chatbot partnership’ showcases a range of options.