Using AI Applications to Unlock Customer Service Success

Can Ozdoruk
Can Ozdoruk
Guest Contributor

In 2020, retailers will move beyond artificial intelligence (AI) pilots and AI adoption will start to take off across the sector.

The promise of artificial intelligence (AI) in retail is well understood. With AI, retailers can optimize processes and merchandising, cut costs, forecast inventories and provide excellent customer experiences. Even so, the retail sector has been slow to move beyond piloting AI in one implementation or another. 

According to CB Insights, “In an analysis of 1,600+ earnings calls from more than 50 publicly traded U.S. retailers, only nine retailers had begun discussing AI-related strategies for their websites or physical stores.”

This is about to change.

The State of AI in Retail

As with any technology, the initial buzz around AI was loud and pervasive. The strategic approach to how AI would actually be implemented within organizations, however, remained ambiguous.

The retail industry’s innovation-first companies unsurprisingly jumped in early.  Sephora has its makeup matching experience that helps customers find the perfect shade. Lowes’ Lowebot helps people find the right product – something as small as a nail – in its seemingly endless stores.

AI is now no longer just for early adopters or companies willing to take a risk with new technology. AI has matured significantly in the past few years. Just look at self-driving cars or AlphaGO AI beating the Go Champions of the world.

Beyond pilots and creative one-offs, AI can now have enormous business implications that have measurable impacts. One example is with an increasingly critical and underperforming part of the business: customer service.

Customer service is now a business driver – or business risk

We live in a Relationship Economy. The customer experience is now on par with quality, price and brand name in dictating buying habits. It can drive long-term loyalty – or turn someone away for life.

A recent survey of over 700 U.S. consumers by Netomi, an AI customer service platform, found that:

  • Customers place a growing premium on the support they receive. Satisfaction with an interaction with a retailer when an issue or question arises directly impacts a person’s buying decisions.
  • Seventy-seven percent of U.S. consumers believe good customer service is fundamental to earning loyalty and business.
  • In the last year, 78 percent of U.S. consumers have stopped doing business with at least one company or scrapped a planned purchase based on poor customer service.

Retailers must provide the customer support that shoppers expect. In a day when a competitive product is so easily accessible, a single bad instance can lead to losing a customer for life. What do people expect in terms of customer service today? According to the research from Netomi, excellent support is defined by being convenient. 

Deploying AI to deliver convenience 

Convenience is central to our culture. We expect personalized experiences with little effort on our terms across all aspects of our lives.

In the study, Netomi found that only 10 percent of people surveyed believe that customer service is convenient today, but 47 percent say this is important in customer support. Convenience is being there for your customers whenever and wherever they need you.

Retailers can bring AI into their workforce to work alongside human agents to meet these quick-rising customer demands. Netomi’s research found that nearly half (44 percent) of people said waiting for a response is a major source of frustration. AI-powered virtual agents can respond in less than one second to repeatable, everyday issues like order status or refund requests.

Customers also expect support on their channel of choice. In addition to channels like email, social messaging and Web chat, resolutions are sought on WeChat, Instagram, WhatsApp, Alexa or Google Assistant. Hiring human agents to scale a 24/7 customer service operation across this increasing number of channels is cost-prohibitive for retailers of every size. AI can scale across channels at near-zero marginal cost.

AI is on deck to disrupt the retail sector in 2020

Juniper Research estimates worldwide spending by retailers on AI will reach $12 billion by 2023.

From cashier-less stores to virtual trial rooms, there are many applications of artificial intelligence that retailers are exploring. With customer service now tied to business results, customer service AI will be one of the primary areas that retailers explore in 2020.

About the writer: Can Ozdoruk is VP of Marketing for Netomi, an AI customer service platform. His insights on customer service and the benefits AI can provide the industry have been featured in publications like CustomerThink, G2, and Clutch.

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