The customer service industry is gaining much momentum, thanks to the disruption of Artificial Intelligence (AI) technology – a breakthrough that has taken almost every business sector by storm. 

For instance, AI is seen as retail’s superpower, because the sector is one among those few industries where the tech is being adopted in a meaningful and actionable manner. One such use cases of AI in retail is product discovery and visualization.

Helping a shopper find exactly what they are looking for has high probability that the customer would come back to the same retailer for their next purchase. Here is where, AI aids in picking up right products. 

Artificial Intelligence-powered chatbots aren’t new today and are helping shoppers find their need. With advanced systems powered by automated solutions, customers can communicate with AI chatbots to order their favorite menu in a restaurant, book a movie ticket or a hotel room and even try out the perfect pair of jeans. 

When it comes to customer service, there are various ways in which AI chatbots will help transform the retail sector. Message-based bots have received wide range of attention among customers, and is seen widely as a means to cost-cuts.

According to a Canadian multinational e-commerce company Shopify, “Many messaging bots can already be found in proprietary retail apps – including Subway or FreshDirect – and when you message branded Facebook Business Pages. Facebook recently confirmed that customers have already created 33,000 chatbots for its Messenger app thus far.”

AI has always been a preferred technology for top brands to satisfy their customer needs in a fast and simplified way than before, as well as using it to improve their business productivity and efficiency.

Denim brand Levi Strauss & Co. set its foot on AI chatbots back in 2017. Dubbed ‘Virtual Stylist,’ the retail giant teamed up with tech company Mode.ai to launch a chatbot on Facebook Messenger that focused on helping customers find the perfect pair of jeans.

The AI-powered chatbots pose questions regarding customer preferences, such as, “How would you like your jeans to fit through your hips and thighs?” After getting inputs from shoppers, the bot would deliver personalized recommendations.

Cosmetics and beauty care company Sephora also added ‘Reservation Assistant’ that enable customers to make appointments with beauty and skincare specialists seamlessly by sending a message to the chatbot. The chatbot understands the language through smart learning capabilities to ease the interaction.

According to Forbes, Sephora’s chatbot led to an 11% increase in beauty appointments when it debuted a messenger chatbot. Starbucks, Domino’s, HealthJoy are few brands that have satisfied their customers with AI chatbot messaging systems.

Now, this isn’t new, but what’s new is that AI chatbot solutions are becoming increasingly smart and intelligent, and this is just the tip of an iceberg. It is believed that AI-powered chatbot industry will become the driving force of business communications in the near future. 

Global Market Insights data stated that the overall market size for chatbots would be over $1.3 billion by 2024.

Human Touch Gone?

Chatbots act like human beings as they communicate and solve customers’ queries in real-time. But that doesn’t get it closer anyway to actual human responses. 

Relying completely on chatbots is out of question because there will be chances where the chatbot machines won’t respond or resolve complicated queries. This is where human agents have to intervene to give acceptable solutions. 

Also, unlike humans, chatbots are incapable to form emotional connections by themselves. If a customer is upset based on their tone, AI chatbots won’t be able to identify this unless it is pre-programmed to identify specific words or connotations, thus leading to unhappy customers.

That said, it is high time to look at chatbots as an assisting solution to ease customer service process, instead of viewing it as a replacement to humans.

Merits and Challenges

Put simply, AI is automation and this disruptive technology has been ruling every industry with its huge array of merits. 

Cost Cuts: Businesses always look for ways to curb costs. It takes a good deal of money and time in hiring and training staff for customer service processes, when it comes to call centers. Automated AI solutions for customer services breaks this burden by reducing costs and time.

For instance, IBM Watson is a pre-programmed intelligent system embedded with domain-specific knowledge base.

Customer Service Track: Another advantage of AI is that it can also be used to usher customer service path. This is when issues get complicated, AI intelligent system will be capable to direct customers towards parallel support tracks, thus bringing comprehensive balance in the support system. 

For example, if a telecom customer service executive is unable to solve a query regarding technical network issues, the AI chat can identify the issue specific to particular support channel and shift customers toward it. 

Precise Prediction: AI have the ability to predict what customers want, that ultimately benefits customer agents. These predictions can be converted into future actions to be taken by customers based on their choices and likes.

Uninterrupted Service and Reliability: One more advantage in using AI for automating responses is its independence from time constraints and stays responsive 24/7 to address customer inquiries. Also, it establishes connection of reliability and trust.

Having said, AI-based customer service solutions or chatbots also pave way to number of challenges. As much as they are playing an important role in making processes better, one pressing issue that has become the talk of the town is its effect on human-centered jobs and capabilities in the workplace. 

It is feared that as AI progresses more, it will steadily take over large sector of workforce, bringing large-scale unemployment and social unrest. While this is daunting employees, staff and customer support executives, experts view this as a temporary issue.

No matter how super-efficient and advanced AI and its solutions might become, some jobs including doctors, therapists, personal trainers, are always done better by humans. While technology experts view this as a threat leading to unemployment, economists and historians say that AI revolution will always create more jobs than they spoil.

According to OCED Jobs Study Analysis, worries about a new era of “jobless growth” appear unfounded.

“History has shown that when technological progress accelerates, so do growth, living standards and employment.”

What Next?

“Alexa” or “Ok Google” are becoming common voice commands in many homes. And over time, artificial intelligence-powered voice search will become a key component of the customer experience. 

According to experts, 2021 will usher in the practice of voice-support platforms using Natural Language Processing (NLP) and conversational analytics based on AI to help businesses improve personalization.

“The advancement of Natural Language Understanding (NLU) will make bot-to-bot communication so effective that human involvement will no longer be required for several business processes,” Dave Wright, Chief Innovation Officer of ServiceNow said in a statement.

Additionally, experts predict that implementation of chatbots will also expand into the workplace in new ways to help with recruiting, training through knowledge assistants and overall efficiency through virtual assistants, thus becoming more intertwined with all walks of life.

Sources: Shopify, Levis, GMInsights.

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About the author

Sujha Sundararajan

Contributing Author

Sujha has been writing and reporting on cryptocurrencies and blockchain technology developments since 2014. Her work has appeared in CoinDesk, CCN, EconoTimes and Fintech News Malaysia. She is also an accomplished Indian classical singer and loves baking cakes.