Skip to main content

Battle of the bots

(Image credit: Image source: Shutterstock/Montri Nipitvittaya)

Over in the US, the financial markets are betting against the traditional retailers having a good holiday shopping season, predicting customers will flock online instead. Naturally everyone thinks Amazon will win the Black Friday battle and the weeks that follow into the Christmas holidays.

Over here, the story is much the same - high street versus online, with many retailers making big price cuts to products sold through in their online operations to maintain share, regardless of margin.

Of course, price cuts aren’t the only thing driving the sales strategy. There’s also heavy investment in the supply chain and ‘omni channel’ operations. Digital transformation will preoccupy vast sums and significant resource in the year ahead as customers warm up to the idea of bots being involved in their shopping experience. In fact, last year Gartner predicted that by the end of 2017 CMOs would be spending more than CTOs on technology.

Speaking to plenty of board members at major brands, that does seem to be the case. Most of it is a product of unlocking the potential of their data to understand the customer more and offer services that make them want to shop with their brand. 

As such, there’s no doubt bots will become more prolific, as artificial intelligence is integrated into familiar apps like Facebook Messenger to offer booking services and online help services. Not only will these services make life easier, they will also provide invaluable insight that can be acted on in a bid to get closer to the customer.

However, while there are some early success stories, earlier this year Forrester warned that some companies were integrating bots too soon - mostly because the bots aren’t simplifying the process, but instead making it more complex.

But while CMOs grapple with finding the right bot technology to help customers and keep it simple, so CTOs are dealing with a bot problem of their very own. Namely the huge volume of internet traffic coming from bots.

In fact, 53 per cent of all internet traffic now comes from bots. For 41 per cent of retailers, bots account for 75 per cent of the traffic. There’s no doubt that bots are the backbone of online retail today, used for price aggregation sites and electronic couponing.

Yet despite this, 40 per cent of retailers cannot distinguish between “good” and “bad” bots. Malicious bots are becoming a real risk. For every good bot intended to help the customer there are dozens of bad bots designed to disrupt trading and steal personal information.

Today, web scraping attacks plague retailers by stealing intellectual property, undercutting prices, holding mass inventory in limbo, and buying out inventory to resell goods through unauthorised channels at mark-up - the famous ‘sneaker bot’ being just one example.

Sneaker bots and similar automated bots dramatically diminish the chances of the average shopper purchasing limited-edition goods. Because of this shift, many have wondered if companies really can ensure a level playing field for their potential customers.

Affording a reputation dent

And of course, this adds to an already complex environment for CTOs. Keeping the website up and running through Black Friday and into January sales is critical. It won’t matter if you have a bot to help a customer if they can’t check out when they want to.

In fact, more than half (53 per cent) are not confident in their ability to provide 100 per cent uptime of their application services with 30 per cent of retailers suggesting they lack the ability to secure sensitive data during busy times including Black Friday and Cyber Monday.

Three seconds is all it takes for someone to switch off from a site that isn’t loading quickly. That’s thousands of pounds in retail and potentially a lost customer full stop, not just a lost sale.

The architecture and data transfer processes are also causing concern. Some 60 per cent of organisations both share and consume data via APIs, including personally identifiable information, usernames/passwords and payment details. Yet 52 per cent don’t inspect the data that is being transferred back and forth via their APIs, and 51 per cent don’t perform any security audits or analyse API vulnerabilities prior to integration. 

The rise of new financial technology like mobile payments has also muddied the water. While it’s been a crucial part of the sales strategy, increasing the access and volume of engagement with consumers, it’s also increased the number of access points with vulnerabilities and has expanded the risk security executives face.

It seems that while digital transformation is recognised as the way ahead, it’s a complicated strategy to get right, especially when it comes to security.

So as CMOs spend more than ever before, so CTOs will have to involve themselves in the procurement of technology in a very different way. Now they must ensure that technology can be integrated into existing support processes. After all the expectation on keeping the company secure won’t wane. If anything, with GDPR on the horizon, it will go up.

CMOs can’t afford a reputational dent - it would be counterproductive to adopt technology that improves the customer experience only to face massive downtime because the architecture can’t cope or a security breach as a result.

There must be a meeting of minds, when it comes to designing and implementing new customer journeys. There must also be rigour and ensure that old systems are not simply side-lined but properly decommissioned or supported with patches for the customers that still have an association to them.

Cash Converters’ recent breach is an example that it’s vital to ensure old web sites are ring fenced and old data is secure. It can’t be a case of out of sight and out of security scope.

Above all the CTO has to educate the organisation not just on the benefits of technology, but also how it can be abused.

Vendors have a role to play in this too. They need to be able to discuss strategy not simply in terms of the latest technical developments and the latest shiny box but in terms of the company’s overall strategic aims.

Only when all three parties work together will consumers be safe and shareholders happy.

Andrew Foxcroft, country manager and regional director for the UK, Ireland and Nordics, Radware
Image source: Shutterstock/Montri Nipitvittaya

Andrew Foxcroft
Andrew Foxcroft is the country manager and regional director for the UK, Ireland and Nordics at Radware.