Making headlines with robots and self-driving cars, Artificial Intelligence (AI) has more quietly infiltrated a growing range of business functions and is anticipated to reach near ubiquity as an alternative to traditional outsourcing in areas such as customer service. Research by technology firm IBM predicts that by 2020 more than 85% of all customer service interactions will be handled in the absence of a human agent.

But can efficiency come at the cost of consumer perception?

Why AI customer service is good for business

Systems with AI embedded can monitor a near infinite amount of website and in-app activity for distress indicators, identifying customers experiencing challenges and what these challenges entail. The system can respond in real-time offering support through FAQs or virtual service agents across platforms and devices. The potential benefits are numerous:

• Reduced Overheads

The absence of human agents can significantly reduce overhead costs and human hours, with specialists training the system once before machine learning capabilities continue improvements. While there are still costs associated with purchasing maintaining software and hardware, they are likely to significantly undercut those associated with running a human team in many cases.

• Increased Sales

A recent Zendesk study showed that 42% of B2C customers purchased more after a good customer service experience, whilst 52% stopped buying after a single negative customer service interaction. The consistency AI can deliver, if well implemented, can generate repeat business and positive brand reputation.

• Scalability

Gone are the days when expanding into a new territory meant establishing costly and context-specific customer service functions or training new personnel. Automated services are not constrained by language (for the most part), time zones and man power. AI chatbots also learn from each interaction, so all geographies benefit directly from centralised learnings.

• Responsiveness

With aggressive innovation among brands such as Amazon, consumer expectations regarding immediacy of service have significantly increased. The omnipresent nature of AI can streamline and expedite all these processes and reduce potential frustration points borne out of wait times.

• Doing more with data

According to IMB, of all the data that each of us will generate in our lifetime, only 33% is actually valuable, and only if analysed. Organisations collecting customer data can combine machine learning and AI to deliver an unrivalled level of personalization throughout the customer journey.  The Forrester report “2017 Customer Service Trends: Operations Become Smarter And More Strategic,” touches on the concept of pre-emptive customer service. It highlights that “[intelligent agents] will anticipate needs by context, preferences, and prior queries and will deliver proactive alerts, relevant offers, or content. They will additionally become smarter over time via embedded artificial intelligence.”

Real feedback on Artificial Intelligence

The efficiency of AI can be diminished by perceived absence of a friendly human touch – AI can still struggle to share humour or detect sarcasm, for example – which can create barriers and negative sentiment among consumers. AI customer service failings are unlikely to be as high-profile or instantaneous as accidents involving robots or self-driving cars but have the potential to damage businesses if left unchecked.

Onefourzero’s analysis of online search demand in the UK and US shows that searches in this space have grown considerably over the last 3 years, as businesses and consumers are increasingly aware of AI’s potential role within customer service.

Despite rising interest, market-level sentiment analysis of social media conversations in the UK shows that consumers are largely neutral towards AI customer service, suggesting either limited exposure, or no overwhelmingly positive or negative experiences.

At a brand level, this type of analysis could be crucial in understanding the impact of AI implementations on consumers’ sentiment over time. Successful deployment extends beyond pure technical setup, and even the most sophisticated systems require careful consideration within the broader strategy.

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onefourzero helps businesses and investors understand the causes and commercial impact of online sentiment, as well as the strategy for their broader digital execution. For more information on how we can help, contact fleur@onefourzerogroup.com