Understanding consumer habits and how customers think and feel about your businesses can be key to success, but conducting paper or online surveys doesn’t always yield the best results, (and how often do people actually take the time to fill those out anyway); a Toronto-based company is attempting to solve this problem by updating the world of customer feedback with its interactive chatbot.

Chatter Research says it can increase response rates by 800 per cent and gather more data about the customer experience using its artificial intelligence-powered chatbot. It’s being recognized by the Information Technology Association of Canada as the Spark winner at the 2018 Ingenious Awards.

“Our job is to capture rich, quantitative and qualitative feedback about [the customer] experience but in a way that feels more natural,” Chatter’s founder and CEO Simon Foster told IT World Canada, “rather than to lead an interrogation we let you as the consumer tell us what was relevant to your experience…then ask really smart questions to ultimately get us to a really great insights.”

The tool uses machine learning algorithms to create conversational text messages between the customer and the retailer. Once a customer has opted in they will receive an automated SMS message after they leave the store, which will ask a variety of questions about the customer’s experience. Chatter calls it “constantly running a focus group that depends on conversation rather than a numbered rating system.”

Once the ‘surveys’ are complete the machine learning algorithm turns those conversations into data, offering companies the ability to review the real-time insights and recommendations through a dashboard.

The company created its own artificial intelligence platform for the project, which it spent a year developing before bringing it to market. Foster says off-the-shelf AI platforms weren’t going to work because while, “those types of AI are pretty good at detecting broad categories, maybe 50 or 60 categories are relevant to an in-store shopping experience. At Chatter we have 850 categories that we’re listening for and need to be very specific in what we discover and in our recommendations.”

He says they needed to create AI that had a more conversational approach with open-ended questions and “off-the-shelf AI struggles to understand the two separate categories and two different sentiments within a single statement. So we had to invest in our own solution.”

Chatter, touting itself as the world’s first AI powered customer feedback solution, was founded in 2016 and has had its AI chatbot in market for only a year and a half, but it has already been noticed by major brands.

Lush Cosmetics, McDonald’s, Mastermind Toys and Unilever are all working with the Toronto-based company. The tool is being used in 1,600 store and restaurant retail locations across Canada and the U.S. and receives more than 10,000 data points every day from consumers. It is even expanding pilot programs to China and Spain with dashboards translated into a number of languages.

It’s not only the machine learning that sets Chatter apart from over survey tools, argues Foster, it also gives companies real-time feedback and helps them learn about things they weren’t aware of before.

For example, in working with Lush, the machine learning algorithm was able to discover over 160 topics that the cosmetics company wasn’t aware were of concern to its customers and weren’t initially areas of focus for the brand. Through its data analytics it was then able to determine that at least 16 of those were quantitatively significant and two were actually the biggest drivers of customer satisfaction.

Other styles of survey don’t offer this type of data or analysis, says Foster and he sees Chatter as being more than a tool, it’s also a partner to the businesses it works with, “it’s not just about capturing the data, but really helping put what we’ve learned into action, making sure that our customers feel like they have a real competitive advantage and can achieve their corporate goals.”

The startup hopes to continue its growth and expand into 10 countries, and has recently announced that its now offers a voice AI interaction survey through Google assistants and Amazon’s Alexa. The company is attempting to make customer feedback easier and smarter, according to Foster, “nobody will cry when the online survey goes away and we intend to be the reason for it going away.”