8 Essential KPIs for Measuring Hotel Chatbot Effectiveness

By Richard Conn

Last updated April 29, 2022

6 min read


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Chatbots are integral to any great ecommerce strategy. In the hotel business, bookings and customer support requests often take place over asynchronous communication channels like email. This can be slow and frustrating for both customers and your business. 

But chatbots are taking the hospitality world by storm and revamping the overall guest experience.

Integrating chatbots into your business strategy can be hugely beneficial for any type of hotel. Whether you run a boutique hotel in the countryside or a luxury hotel in the city, chatbots can help you provide customers with the answers they need without waiting in hold queues or getting lost in endless email chains.

There are plenty of business processes examples that can be automated with the use of an AI chatbot. It’s not enough to simply install a bot on your hotel website or social media page and just let it do its thing. Like any other part of your business strategy, your chatbot needs to be measured, analyzed, and optimized. Key Performance Indicators (KPIs) help you do just that.

Why measure hotel chatbot effectiveness with KPIs?

Tracking and analyzing the right chatbot KPIs will help you to gauge how effective your chatbot actually is at handling customer contacts. You’ll be able to understand whether chatbots are helping your customers to solve problems, make bookings, and find information about your hotel business. 

Using the metrics mentioned in this article, you can highlight any potential stumbling blocks that need to be addressed and keep improving the service for a better customer experience. You can also gain insight into how satisfied your customers are with the overall chatbot experience, and whether or not their needs are being met.

Lastly, you can measure your business ROI through metrics that tell you how many leads the chatbot is generating, conversation success rate, and conversions. That'll help you compare the cost and overall effectiveness of your chatbot with other customer service channels to see how you can leverage chatbots to handle certain types of customer requests and free up live agents for more pressing concerns. 

 

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There are plenty of KPIs to measure chatbot effectiveness. We’ve chosen eight of the most important KPIs to help you optimize your hotel chatbot, enhance the customer experience, and improve your business’s return on sales

1. Conversation success rate

The conversation success rate is one of the most important KPIs to track when measuring the effectiveness of your hotel chatbot. Chatbots aren’t guaranteed to solve your customers’ problems. Sometimes problems can only be solved with human intervention. Although, you can determine the conversation success rate of your chatbot by measuring whether the user’s request is successfully processed, or whether it needs to be escalated to a live agent.

The success of your chatbot depends on the information you put into it. You can improve this metric by making sure your bot is programmed to answer frequently asked questions so customers can get the information they need instantly. 

Of course, chatbots shouldn't be relied on too heavily to handle customer interactions. But implementing a chatbot alongside other technologies and omnichannel customer support, you’ll ensure customers can solve their requests in whichever way they want. Ask yourself questions such as “what is a predictive dialer?”,  “what is our conversion goal?”, “what is IVR?”, and you’re thinking along the right lines.

2. Number of bot sessions initiated

This metric measures how many interactions are sent and received between your chatbot and users. When it comes to rule-based chatbots, this metric is relatively straightforward to gauge. The number of interactions reflects how far down the conversational decision tree the user went. By measuring this, you can tell how long it took the bot to solve the user’s problem. If it took too long, you know that you need to reduce the steps involved to reach a conclusion or vice versa.

3. Bounce rate

Bounce rate measures how many users go to your website and exit the page without interacting with your chatbot. The higher the bounce rate is, the worse it is for your business. There’s something wrong if people are landing on your website and immediately navigating away. Perhaps there’s something wrong with your hotel’s website design or content that means visitors don’t want to stay on it to interact with your chatbot.

4. Booking conversions

Making a reservation for a restaurant or hotel is one of the top predicted use cases for chatbots. Even if you have an easily accessible booking system, a large percentage of the questions your chatbot receives will be about booking a room.

Chatbots can be programmed to present information about reservations clearly and accurately. Moreover, they should always ensure customers are getting the best deal possible. Your chatbot must be able to handle regular reservation queries as well as more complex ones such as group bookings to ensure customers don’t drop off before converting.

Sometimes, people might have a promising conversation with the chatbot and then drop off when the bot transfers them to a booking engine. For instance, if people are sent to a booking engine with a poor UX, then your chatbot booking conversions will decrease.

According to Quicktext, the average chatbot conversion rate should be about 20%. Keep an eye on this metric and ensure that if it drops below 20%, you look into the usability of your booking engine.

 

 

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5. Conversation duration

Conversation duration measures the length of the interaction between the bot and the user. The ideal length of the conversation depends on the customer’s request, and whether it can be solved quickly or requires the case to be transferred to a human agent. 

For instance, if someone asks a business phone service provider’s chatbot a simple question like “how does an internet phone work?”, the bot can simply link them to an FAQ page where they can read about it themselves. This interaction would have a very short conversation duration.

No matter what requests users have, the conversation duration should be long enough to help them find the answers they’re looking for and short enough that they won’t become frustrated and leave.

Keeping track of conversation duration helps you gauge how effective your chatbot is by showing how capable it is of having meaningful conversations that engage the user. Although chat duration depends on the context of the conversation, if chats are too short or too long you’ll know something is up.

6. Customer satisfaction score

This is one of the most important customer experience KPIs to keep track of because it’s a direct measure of how satisfied your customers are! Customer feedback is essential for driving business growth. Set up your chatbot to ask a simple yes or no question about the customer’s experience, or ask them to provide a rating of how satisfied they are with the help they received.

Customer feedback can help you identify flaws in the chatbot conversation flow, as well as other issues like poor UX design or repetitive responses. Armed with this information, hotel managers can improve the chatbot experience for more streamlined interactions.

One thing you can do to improve customer satisfaction is to ensure your chatbot integrates natural language processing (NLP) for a more conversational experience. Studies have shown that customers prefer it when chatbots can have a “natural” and “human-sounding” conversation.

 

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7. Fallback rate

Chatbots aren’t foolproof. They might not always have the answers to satisfy customers, even if you’ve input all the possible information you could imagine, customer requests are unpredictable. Fallback rate is the percentage of times your chatbot fails to (or nearly fails) to handle the customer’s request. This KPI provides insights into scenarios where bots can’t understand the user request and might fail to provide a solution.

For instance, if users frequently experience replies like “Sorry, I don’t understand”, then it’s going to impact their experience and lead to increased levels of frustration. If the bot can’t handle many of your customer requests, it’s failing to do what it should be doing - wasting your business resources and your customers' time. Remember, the higher the fallback rate, the lower your customer satisfaction rates are likely to be.

8. Overall retention rate

This KPI measures the percentage of users who return to your website to interact with your chatbot within a specified period of time. Tracking the overall retention rate will help you understand how relevant your chatbot is and whether customers are happy to interact with it.

Ways to improve chatbot retention rate is to ensure you provide personalized customer support or to offer customers discounts or special offers based on their user behavior.

Implement a hotel chatbot to improve the customer experience

Hoteliers are modernizing the way they do business and technology has taken over the hospitality industry. From digital phone systems to contactless channels, chatbots are just the tip of the iceberg.

Chatbots are a great tool for providing customers with quick solutions whether they want to make a reservation or need help from your customer support team.

Tracking these chatbot KPIs will help you understand whether or not your chatbot strategy is successfully helping you provide a memorable experience that’ll keep customers coming back.

Here are some hotel chatbots worth checking out

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