Welcome to K2 Disrupts Episode 3, where we are going to talk about chat bots and AI chat bots. My name is Ken Chung, VP of Growth at K2 Digital. And I'm Martin Byrne, Head of Digital Innovation. So this is one where actually we're supposed to be cutting through the hype and there certainly is a lot, but I actually see a lot of application for what we're doing here. The idea that we can have an artificially intelligent system that interacts with human beings to help with, not only the sales cycle, but the customer service cycle, is something really exciting. And I think that myself and Martin are seeing a lot of trends in the space. Yeah, I mean, there's three things that are driving the explosion of chat bots right now. One is just the acceleration and the powering up of mobility. Not just the phones themselves, but the capability of the network, the capability of Wi-Fi. The ability to move data back and forth is really important, because the second thing that's driving the resident chat bots is AI. And we talked about that in episode one. We talked about in episode two. AI is really the thing that underpins it. But the third thing that kind of created the market for it was the rise of the messaging wars. Yeah, and that's where the readiness of mobility like you talked about. And the readiness of the always on network that we're seeing. And we look at Facebook Messenger, and we look at WhatsApp, and we look at WeChat. We're actually seeing a convergence of not just chat from a consumer perspective, but they're really full-blown application platforms. And we're really actually seeing that in China, on the WeChat and the development of, you really only need one app. With WeChat, you've got every app plugged in. You suddenly have my whole social graph. You have all the information of everything that I'm talking about. Imagine the opportunity for interaction that happens in that kind of ecosystem. Yeah, and I mean, it's such a huge explosion that between the beginning of 2016 and the middle of 2016, over $170 million that have been invested in startups and development around chat bots. And AI assisted chat and consumer support. Yeah, and I think because we're adopting chat in our personal lives, and we can see the power of the platforms themselves, of course it's coming at an industrial scale as well, because quite frankly, it's a more human way to interact with what we're calling artificial intelligence and a human interaction system. The idea that I can interactively speak and get the information I want is really, really powerful. But the root of it is that 71% of customers just want a better client experience, and they want to be able to solve their customer challenge in a way that makes sense to them. Yeah, what's happening really fast is chat bots are moving just from Q&A support. And we're starting to see people develop chat bots doing all sorts of things. Last year, KLM had a great example where they launched a chat bot attached to their customer support. They're not only providing you basic Q&A, but you could look up your reservations. You could find out information about potential routes. Basically, everything that you used to be able to ask flight attendant or a desk clerk, you could now ask the chat bot. We're seeing chat bots that show up now that help you plan your scheduling, chat bots that help you organize your teams, manage project scheduling. So chat bots are going beyond just the, let me ask a question that you get a question back, which we're familiar with through things like Siri. And because of that explosion now, a lot of the larger organizations are taking notice and are starting to play around with this. Yeah, and I think that's why we've seen $450 million of investment recently for these platforms from the likes of IBM, from Twilio to Slack to River, to all of these industrial grade tools that are coming in to really fill the gap for each one of those niche places where chat can really help. Where collaboration is going to increase the cycle of productivity for enterprises. I think that's really, really exciting for our client base. When we look at financial services, insurance, mining, energy, I think we see the convergence of all the technologies we've talked about in our previous episodes as well. And I think this is an area where, as we continue to innovate, because of the number of names that are piling in, companies are really struggling to figure out what is the right application I should use for my brand. For instance, one of our financial services customers came to me and said, you know, I'm one of the top five brands in Canada for banks, should I add Facebook chat to my website? And the answer is probably somewhere in between, yes and no. But K2 Digital is a good partner at looking at the strategy of that and thinking, wait a minute, is that how we really want to engage? Are there alternate ways and alternate technologies we can use to really leverage AI and chatbots to interact with our customers without necessarily eroding the security of the communication while improving the customer experience from end to end? Yeah, entirely. Chapbot isn't just something you turn on or turn off. Chapbot has to be part of an overall customer experience strategy. Has to be tied into legacy systems. It needs a lot of base information, because a lot of chatbots, particularly the AI, need thousands, potentially tens of thousands of example pieces of information to start building reactive language. The chatbot state can actually create new response phrases, new answers that you don't write in a program, but to do that, needs a lot of base information and access to that. So you got to have a plan. Yeah, and in 2017, I think we're actually going to see chatbots that you're going to be interacting with without even knowing that they're actually not a human being. And I think the really great tipping point will be when you are actually transitioned from a chatbot and from AI to a human being seamlessly without even knowing it to complete the client-line experience. And I think when we look at wealth management, when we look at asset management, when we look in insurance, that's really where cost savings to enterprises are going to be. Where simple tasks that the AI chatbot can take care of are offloaded from your high-touch brand services and are actually moved off in terms of a customer service cost, and where you guys can focus on delivering your core business, but where a high-value transaction is happening, or where someone who's maybe older on the age scale and isn't as good at interacting with the chatbot, is seamlessly moved into either a sales cycle or a high-touch customer service cycle, and is able to transact at a very human level. And I think when we get that, we're going to really see changes in gains in the industry on how this is used. And I think that's where, if you have an opportunity from a project perspective or looking to get this out there quickly, I would love to hear from you. I know Martin and myself would love to hear from you in terms of moving forward and bringing that to the market for your business and for your brand. That's episode three of K2 Disrupts, and we look forward to bringing you episode four.