How AI can improve the customer service experience

Published · 6 min read

Recent developments in AI and automation have made the technology more accessible to small and medium-sized businesse. When integrated into businesses, AI has the potential to drive efficiency, decrease costs, and much more. However, most business owners aren’t fully aware of how this technology works.

AI, most simply defined, is a technology that can use machine learning to identify patterns of behaviour to “learn” new skills or approaches. AI allows businesses to intelligently automate essential processes. As such, it’s not surprising that 61% of businesses already use some type of AI while 30% of companies plan to increase AI expenditure over the next three years.

AI not only makes employees’ and business owners’ lives easier. If used correctly, it can also benefit customers by providing reliable, 24/7 assistance and personally tailor their sales and service journey. Forbes reports that, like all emerging technologies, some customers are resistant to AI, but 68% would accept AI support if it made their lives easier.

So, should you consider investing in AI customer service technology? We’ll discuss the benefits, and disadvantages as well as providing some examples of how it is used to help you decide if artificial intelligence could improve customer service for your business.

Benefits of artificial intelligence for customer service

AI technology works best when it continually receives a vast amount of data making it well suited to improving multiple facets of customer service.

Greater customer support

With the help of AI applications, companies can provide customers with round-the-clock support. Unlike human employees, artificial intelligence can work during weekends, holidays and after hours. Since customer activity is often higher outside regular working hours, AI customer service applications, such as chatbots, provide customers with support whenever they need it.

While automated chatbots can only reply within a specific framework, AI-powered chatbots can continually learn from previous experiences to offer better support. Chatbots will never get angry or frustrated with customers and can be programmed to elevate issues or unknown questions to human managers.

Personalised sales and service journeys

AI software can collect and analyse customer data far more efficiently and effectively than human employees. With access to in-depth information, companies can gain a deeper understanding of their customers and when combined with other AI technology, can produce individually tailored customer experiences.

Artificial intelligence customer service applications can use machine learning to recommend items based on a customer’s past purchases and behaviours or redesign websites in real time to suit customer’s browsing habits or service requirements.

Providing customers with personal experiences can increase their satisfaction with service levels in addition to driving more sales and higher levels of brand loyalty.

Artificial intelligence for self-service

The way customers prefer to engage and interact with brands is changing. Most customers, especially tech-savvy millennials, would rather solve their own issues and not interact with humans. In fact, 72% of millennials believe speaking on the phone with a company representative is ineffective.

AI applications can collect information such as the customer’s online actions, past orders or usage and prior conversations with support teams. This information can then be used to make assumptions about what the customer needs to resolve their problem.

Solutions could include personally tailored help pages, specific product options or AI chatbot support.

Disadvantages of AI customer service

Since AI technology is relatively new and has only recently become mainstream, there are still a few kinks to iron out. With the further development of AI applications, these disadvantages should mostly be overcome.

AI can’t access the ageing population

The British population is getting older. Within the UK, 18% of the population is over the age of 65 and this trend is only expected to continue. By 2036, 25% of the population will be over the age of 65. Traditionally, older individuals struggle to use technology. While most of us consider the internet to be a vital part of life, 2.6 million British citizens over the age of 75 have never used it.

A similar trend will occur with AI technology. If older populations do not or cannot use modern technology, then businesses may not be able to reach older customers with AI and internet-based technology.

On the other hand, this issue may become smaller as ageing people become more adept at responding to emerging and constantly changing technology.

Some companies have come up with creative ways to address this problem. Barclays’ Digital Eagles programme, for example, aims to increase customers’ confidence in digital technology.

GDPR and AI software

A natural feature of AI applications is their ability to collect and process large amounts of information. While customer privacy and security are significant concerns for any company processing data, the GDPR further compounds this concern.

GDPR, the most significant data privacy and confidentiality overhaul in decades, drastically changed how EU companies can gather information on customers and as such impacts artificial intelligence.

Some critics have protested that GDPR will kill artificial intelligence. After all, under the new regulations, customers must opt-in to data collection and companies aren’t allowed to profile customers using an algorithm. It certainly seems that the GDPR regulations hinder AI capabilities. The full impact has yet to be determined and court cases will probably provide the final verdict.

Artificial intelligence lacks the human touch

AI customer service applications may be able to understand human requests and make logical decisions but they are unable to display empathy or handle emotions. As such, they might not provide a great experience for customers that are upset or stressed.

The best customer service experience requires a mixture of human elements and AI applications. Customers want emotional as well as practical support when in a crisis, but human representatives can often solve issues faster with the assistance of AI technology.

Forbes recommends that companies only use AI technology for objective yes or no queries or to reach outcomes via an algorithm. For everything else, companies should use human representatives. It’s about getting the right balance.

Who currently uses AI for customer service?

AI is being used across a range of industries, from healthcare to e-commerce, to provide better support to customers or clients. Some examples of using AI to improve customer experiences include the following.

The NHS 

The NHS is trialling the use an AI-powered chatbot to provide patients with digital support. Instead of calling the 111 non-emergency helpline, customers enter their symptoms into an app and the chatbot, using a medical database, provides tailored advice.

Tesco

Tesco has partnered with Google Home to allow customers to verbally order groceries, be alerted to price drops on certain items and even create custom recipes. Using information about past orders, Google Home can suggest products that customers might have forgotten.

Moo.com

Moo.com, a stationery website, uses an AI tool called AnswerDash to provide customers with self-serve help options like chatbots, smart FAQs, and how-to content. Chatbots help customers with common questions, which frees up human employees to help with more complicated problems, and data is used to identify frequent issues and create content to offer relevant solutions.

Expedia

Expedia uses AI software to provide personally tailored online experiences for each customer. When searching for a hotel, Expedia’s AI software selects the best photos to show customers based on their previous behaviour on the site.

Expedia is even developing an algorithm to profile customers and more quickly identify their needs. For example, someone travelling for business would see photos of the hotel’s gym or bar.

How to integrate artificial intelligence into your customer service

Before you integrate AI into customer service, there are a few points worth considering. Having clear customer service goals and objectives will help you answer the following questions and implement AI tactically or strategically.

  • How would AI be used to reach these goals?
  • How would AI achieve better results than your current strategy?
  • What customer segments are you looking to serve using AI?
  • How would AI fit with your current customer service methods?
  • What relationship would AI have with your employees?
  • What point in the customer journey would AI appear?

Available AI customer service applications

With a plan in place, you can then look for the most suitable AI solution. Thorough research is always required, especially with regards to integration with your tech stack but some of the solutions below are currently popular choices.

Chatbots

AI-powered chatbots are one of the most widely adopted forms of artificial intelligence. Most AI-powered chatbots use natural language processing to understand customer’s requests and provide “smart” answers.

New products are constantly emerging but market leaders include Aivo, Botsify and Chatfuel. Botsify and Chatfuel integrate with Facebook Messenger, while Aivo can integrate with Salesforce, Zendesk, WhatsApp, etc.

Smart emails

AI-powered email applications can help you drive engagement and open rates by selecting the right words, writing catchy subject lines, and increasing personalisation. Case studies have shown that customers are more likely to engage with emails written by computers, sometimes as much as x10 than human employees.

Leading products include Phrasee (used by Virgin Travel), Adobe Campaign, and OptiMail. These platforms can create dynamic content, so each customer sees different content and adjusts company approaches for better results.

The future of artificial intelligence and customer service

With so many applications and benefits, it won’t be long before AI customer service becomes the norm. In fact, IBM predicts that by 2020, machines will handle 85% of customer interactions.

Still undecided? We suggest reading our articles on five ways robots can benefit your business and should your business hire robot workers.

Let us know your thoughts on AI and customer service in the comments below.

Subscribe to the Sage Advice enewsletter

Get a roundup of our best business advice in your inbox every month.

Leave a response