customer relationship management (CRM Enabled CRM 

On September 20, 2017, HubSpot, an inbound marketing, sales, and customer relationship management (CRM) software provider, announced that it had acquired Motion AI, a software platform that enabled companies to easily build and deploy chatbots to interact with their customers. Chatbots were pieces of conversational software powered by artificial intelligence that had the capability to engage in one-to-one chat with customers on their preferred chat platform, such as Facebook Messenger or WeChat. Fueled by pre-programmed algorithms, natural language processing, and/or machine learning, chatbots conversed in ways that mimicked actual human communication.

Since its founding in November 2015, Motion AI had facilitated the building of 80,000 bots for brands including T-Mobile, Kia, Sony, and Wix, which were busy conversing with customers via 40 million total chat messages sent to date. The software was simple to use and enabled anyone, regardless of their level of technical knowledge, to build and manage a chatbot. The entire Motion AI team, including founder and CEO David Nelson joined HubSpot following the acquisition.

HubSpot saw great potential for chatbots for its business-to-business (B2B) customers, who could use them to automate many of their customer interactions that today were staffed by humans. Unlike other automated customer service solutions, such as interactive voice telephone response (IVR) systems that were almost universally disliked for their robotic nature, chatbots were getting closer to passing the Turing Test, convincingly simulating a human conversational partner so well that it was difficult to sense when one was chatting with a machine. Thus, chatbots had the potential to enable a company to nurture and manage one-to-one customized relationships with prospects and customers efficiently at scale by making artificial intelligence the new frontline face of their brands.

Chief strategy officer Brad Coffey and chief marketing officer Kipp Bodnar were responsible for working with Nelson to bring Motion AI’s technology into the HubSpot family of products. Before unleashing bot-building technology to its customers, HubSpot first needed to develop some best practices for the use of chatbots for CRM. Without proper instruction, Coffey worried that companies, in their rush to incorporate the newest marketing technology, would build bots that would do more harm to their brands than good. He prognosticated,

In the not-so-distant future, there’s a bleak, forsaken landscape. Civilization, absent. Communication channels, silent. All of the people have fled, terrorized by never-ending notifications and antagonizing messages. What could cause such a desolate scene? Bad

HBS Senior Lecturer Jill Avery and Professor Thomas Steenburgh (University of Virginia) prepared this case. It was reviewed and approved before publication by a company designate. Funding for the development of this case was provided by Harvard Business School and not by the company. Jill Avery has served as a paid consultant to HubSpot. HBS cases are developed solely as the basis for class discussion. Cases are not intended to serve as endorsements, sources of primary data, or illustrations of effective or ineffective management.

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518-067 HubSpot and Motion AI: Chatbot-Enabled CRM

bots. Okay, maybe that sounds a bit too much like the next superhero blockbuster. But it wouldn’t be the first time that brands abused a new technology until people were buried in spam up to their eyeballs.

He continued, “5% of companies worldwide say they are using chatbots regularly in 2016, 20% are piloting them, and 32% are planning to use or test them in 2017. As more and more brands join the race, we’re in desperate need of a framework around doing bots the right way — one that reflects the way consumers have changed.” The Motion AI technology would be incorporated into HubSpot’s product over the next few months, so the team had little time to make important decisions. First, they had to clearly assess the implications associated with the use of bots versus humans to create, nurture, and manage customer relationships and to determine whether and where in the marketing and sales funnel bots were appropriate for use during marketing and selling processes.

Second, they had to decide to what extent to anthropomorphize chatbots. How human-like should they be? Was a conversational user interface (UI) the desired solution or would a more functional UI produce more efficiency for customers? How much should the bot embody the brand’s personality or mimic the conversational style of an individual user? Should users know when they were interacting with a bot or could human-like bots create stronger relationships?

Historically, HubSpot had “practiced what it preached,” using its own products to build its business. Coffey and his team had to consider whether to use chatbots to nurture and service its own customer relationships. Currently, a team of chat representatives worked to engage, nurture, and prime prospects for HubSpot’s sales team. Could they and should they be replaced with chatbots? Was HubSpot ready for bots to become the face of its brand to prospective customers?