By 2025, 80 percent of customer service and support organizations are predicted to use AI to improve customer experience. In fact, employment in customer service call centers is rated as one of the most stressful professions in the world, and annual staff turnover rates can be as high as 45 percent. Across the world, companies are adopting AI to ease the load on their service teams, increase their operational capacity at relatively low cost, and meet rising customer service expectations. AI’s advancement into customer service is one of the most publicly examined emergent developments, making it a focal point for the many companies that have yet to adopt AI and are poised to do so.
In this article, we will explore how this technology is being deployed in customer service and how it is changing the whole consumer experience. We will also look at the array of industry sectors that are deriving benefits from Conversational AI.
Conversational AI And Its Usage
Conversational AI encompasses technologies for creating human-sounding conversations between machines and human users. A computer's ability to converse with a person arises mainly from Natural Language Processing (NLP). NLP enables computers to communicate with human users by understanding and responding to human speech and text in a human-sounding fashion.
At the customer service interface, three main classifications of Conversational AI solutions have emerged:
Virtual Assistants
You see these text-based conversational interfaces all over the web, in mobile apps, and in any messaging system from WhatsApp. Users type or otherwise select queries, and the bot responds with what it believes to be the most relevant and useful information, having learned from experience.
Voice Bots
These have evolved from early Interactive Voice Response (IVR) systems, which relied on pre-recorded messages, into bots based on much more sophisticated voice technologies. Modern voice bots can run on speech synthesis and deep learning AI models to understand verbal commands and speech. These advancements have improved their ability to recognize different accents, understand colloquial terms, and still work well under less-than-ideal call conditions.
Smart Assistants
Devices such as Google Assistant or Amazon Alexa belong to this category; they are integrated into other services to provide help at home and are also increasingly used in physical stores to improve customer experience. In the store, they can guide customers in finding the products or provide sales staff with information in real-time to improve the customer experience.
AI Effect On Customer Experience
Conversational AI, the AI that’s changing the face of customer service as we know it, has come a long way. Just a decade ago, tech-driven customer service largely consisted of chatbots, simple website forms, and early attempts at automation. Today, customer service expectations have increased to the point where it should be speedy, intelligent, and omnichannel, with support available at any given time on the phone, email, apps, web chats, video calls, and social media. Failure to meet this expectation can drive a customer to your competitor, highlighting why AI is no longer a “nice to have” but rather a “must have” technology for a business.
Conversational AI is particularly impactful in several key areas:
Quicker Responses
Modern customers are less willing than ever to wait minutes or hours for a response to their query or to be put on hold while their call is being transferred. Invariably, they are looking for a solution to their problem as quickly as possible. Conversational AI enhances the resolution process in two key areas. Firstly, technologies such as virtual assistants and voice bots can process customer information and create a response almost instantly, handling thousands more queries than a human team. Secondly, AI can help human support agents by immediately feeding information about queries back to them, speeding up response times. In fact, according to research from Salesforce, 63 percent of service professionals say using AI has made them more efficient at serving customers faster.
Personalization
There’s a huge gap between the type of tailored experiences that customers expect and what a lot of companies deliver. Segment research found that while 85 percent of businesses believe they are providing personalized services, only 60 percent of customers agree. This points to a desire for personalization, making customers frustrated if they get a cookie-cutter response from a chatbot. AI is key to closing this gap. If you can dig into the customer’s behavior and previous interactions, you can respond in a way that feels more tailored and relevant to them. This more targeted approach to personalization is becoming essential to meet modern customers’ expectations.
Spotting Upselling Opportunities
Taking this discussion further, the customer data that AI can collect is a great resource to increase customer interest in more products or services that they might find interesting. It can help place them with products that are more relevant to their preferences and past purchases. This data is then used for crafting promotional messages and special offers that are tailored to that specific customer. Customers' conversations with virtual assistants and voice bots also generate text and speech data, which further amplifies the way personalized recommendations can be offered.
24/7 Support Availability
Conversational AI is dramatically improving customer service by making it more efficient and scalable so that operations can run 24/7 in a cost-effective manner. For example, AI automates repetitive tasks and delivers actionable intelligence to help the customer support teams be more effective. At the same time, virtual assistants and voice bots work around the clock without the customers having to wait until business hours to speak to someone who can help them. It also means that businesses do not have to pay a premium to keep their customer support staffed during nighttime hours.
What Sectors Are Primed to Advance with Conversational AI in Customer Experience?
Customer service has become the key competitive differentiator in any consumer-facing sector, and Conversational AI is going to play a big role in driving innovation in this area. There are four industries in particular where the use of Conversational AI could result in potentially transformative change:
Financial Sector
Customer frustration is an issue in the banking sector, and as a result, we are seeing more financial institutions turn to Conversational AI to augment service delivery. This technology helps with intelligent call routing to connect customers to the right person in a timely manner. It can also provide personalized services and offers, such as upselling based on customer data. Conversational AI is used to help secure and authorize customers using natural language processing, and it can handle simple queries like branch hours or PIN reminders.
Retail
Conversational AI is transforming how retail services can scale and be accessible 24/7. Customers often ask for basic information, such as their order status. The Virtual Assistant can pull up that information and relay it to the customer in under a minute. The system can also increase efficiencies in billing and payment, handle store hours or product details, and offer tailored promotions and upselling.
Hospitality
In the hospitality sector, whether we’re referring to a hotel or a restaurant, the customer expects top service from the time they book to the time they leave and everything in between. Conversational AI helps in this regard by facilitating bookings, reservations, and pre-payments so that the customer can finalize all of that right then and there without waiting for a staff member. It also creates opportunities for upselling and cross-selling by automatically offering the customer a better table, a room upgrade, or other special deals.
iGaming
As the iGaming market is overflowing with hyper-personalization, players are expecting more games, offers, and experiences tailored to their needs and preferences. Conversational AI is driving many of these innovations, from in-game conversations that mimic human ones to more personalized assisted gaming experiences. Most importantly, it plays a key role in identifying gambling behaviors that could indicate addictive behavior. By detecting these patterns early, Conversational AI can intervene immediately and help ensure that gambling stays safe and responsible.
Optimizing the Use of Conversational AI
Looking to include Conversational AI into your customer service and ensure your organization is taking full advantage of the latest technologies? We work day-to-day with companies from several sectors, including iGaming, finance, and retail, to make sure their Conversational AI implementations are state-of-the-art, experience-driven, and holistically developed. By leveraging the latest in innovation, experience design, and development, we’ll help you provide faster, more efficient, personalized, and cost-effective service to your customers. We always bring new capabilities to the table, so that your customer service becomes a real source of competitive advantage.