It is not merely a chat: Transforming chatbot affordances into dual identification and loyalty

Artificial intelligence (AI)-powered service chatbot functionality is changing to more effectively connect with customers in the era of digital marketing. As such, an understanding of how to enhance user perceptions and behaviors through interface design has become crucial. Using affordance actualization theory and social identity theory as a theoretical lens, this study explored how chatbot affordances affect consumer brand loyalty. Data were collected from 369 respondents who had at least one conversation with AI chatbots from a predetermined list of banks in Taiwan; the collected data were then analyzed using structural equation modeling. The results revealed that anytime–anyplace connectivity, information association, visibility, and interactivity affordances provided by chatbots positively influenced chatbot exploitation, which in turn affected perceived brand competence and perceived brand warmth. Furthermore, perceived brand competence influenced customer–chatbot identification and customer–brand identification, whereas brand warmth influenced customer–brand identification. Customer–chatbot identification also influenced brand loyalty both indirectly—through customer–brand identification—and directly. These findings are useful for assisting managers in various industries in the application of AI technologies to implement digital transformation strategies and improve customer services. •Chatbot affordances influence chatbot competence and warmth.•Chatbot competence influences customer–chatbot and customer–brand identification.•Chatbot warmth affects customer–brand identification.•Customer-chatbot identification affects loyalty through brand identification.