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AI for the Customer Experience: Benefits, Challenges, and Examples

min read
AI for the Customer Experience: Benefits, Challenges, and Examples

Businesses across industries are investing a lot of resources in artificial intelligence (AI), hoping it will deliver big returns to their bottom lines. They’re implementing and experimenting with AI technologies in many ways — from automating processes in their back office, to crunching vast amounts of data to identify trends and gain business insights, to delivering more efficient and personalized customer experiences.

Initiatives related to the latter goal can be especially important for generating AI ROI. According to research from Gartner, Inc., one of the top three sources of AI business value is the customer experience. Gartner also states that the “customer experience is a necessary precondition for widespread adoption of AI technology to both unlock its full potential and enable value.”

That’s all positive news for businesses that develop and use AI technologies. But what about customers? Are AI-enhanced customer experiences really able to deliver value for them? The short answer is yes.

In this post, we cover the basics of AI for the customer experience, including its benefits, challenges, and real-life examples of how innovative companies are using it.

What Are the Benefits of Using AI for the Customer Experience?

Artificial Intelligence (AI) has revolutionized the customer experience landscape, enhancing efficiency and delivering personalized interactions. Here are a few key benefits of implementing AI into your customer service: 

  • Improved Customer Support Efficiency: AI-powered chatbots and virtual assistants can handle routine inquiries, freeing up human agents to focus on more complex issues, resulting in faster response times and reduced wait periods for customers. 
  • 24/7 Availability: With AI-driven automation, businesses can provide round-the-clock customer support, ensuring customers can get assistance anytime, even outside regular business hours. 
  • Personalization at Scale: AI algorithms analyze customer data and behavior to offer personalized product recommendations, tailored responses, and targeted promotions, enhancing the overall customer experience.  
  • Seamless Multi-Channel Support: AI streamlines the customer service process across various channels, including email, social media, chat, and phone, ensuring consistent and coherent support experiences. 
  • Reduced Response Times: AI-powered systems can analyze and categorize incoming inquiries, helping agents prioritize urgent requests and significantly reducing response times.
  • Cost Savings: Automating customer interactions with AI reduces the need for a large customer support workforce, leading to cost savings for businesses in the long run. 
  • Data-Driven Insights: AI technologies like conversation intelligence can gather and analyze customer conversations at scale and automatically surface trends. Customer experience teams can use these insights to get ahead of common issues, update talk tracks, and improve contact center agent training.

Incorporating AI into customer service strategies empowers businesses to deliver exceptional customer experiences, and build lasting relationships with customers to stay ahead in today's competitive market. To learn more about the benefits of prioritizing your customers’ experience check out our other blog post here

What Are the Challenges of Using AI for the Customer Experience?

While AI offers numerous benefits for enhancing customer experience, its implementation comes with certain challenges. Here are some challenges businesses may face when incorporating AI into customer service: 

  • Lack of Human Touch: AI-driven interactions, though efficient, can sometimes lack the human touch and empathy that customers expect, leading to a potential disconnect and dissatisfaction. 
  • Integration Complexities: Integrating AI technologies with existing customer service systems can be complex and time-consuming, requiring seamless alignment to ensure a smooth customer experience.
  • Overcoming Customer Trust Issues: Building customer trust in AI-powered interactions remains a challenge, as some customers may be skeptical about the reliability and accuracy of AI-driven solutions. 
  • Balancing Automation with Human Intervention: Striking the right balance between AI-driven automation and human intervention is critical, as excessive automation may lead to a lack of personalized support, while too much human intervention can negate the efficiency gains of AI. 

AI Customer Experience Statistics You Need to Know

Our recent report on the state of the contact center sheds light on important AI customer experience statistics. These findings provide valuable insights into the impact of AI on customer interactions and service delivery. Here are our top three significant statistics from our State of the Contact Center Report:

  1. 47% of customers call in for things they can do online. AI can help your call center’s numbers by answering those pesky repetitive questions that could easily be answered with the information on your website! 
  2. 85% of call center managers are likely to implement a conversation intelligence solution in the next year. It’s highly likely that your competitors will be adopting one of these solutions as well. And if they don't, your service will differentiate itself from your competitors as you reap the benefits of automation! 
  3. Contact center employees that use conversation intelligence report that they analyze a higher percentage of their calls. Of the contact centers that analyze over 80% of their calls, 30% of those use conversation intelligence and 13% use manual call listening. Clearly, conversation intelligence is a whole lot more scalable than listening to every call! In addition, since it uses the power of AI, its scores are unbiased and free of human error.

5 Innovative Examples of How Companies Use AI for the Customer Experience

1. Allstate

When Allstate first started using its “You’re in Good Hands” tagline in the 1950s, the company probably did not envision a day when those hands would belong to an AI-powered chatbot.

“Amelia” is a virtual agent well-versed in the world of insurance. She’s trained on more than 50 insurance topics and regulations across all 50 states. She can answer tough questions with concise answers that also meet compliance requirements. And she’s handled millions of customer conservations since she was first tested in 2017; today, she assists most of Allstate’s call center employees.

Amelia is helping Allstate reduce talk times and resolve more customer issues on the first call. The assistance she provides is also reducing training time for call center agents.

2. The Faulkner Organization

Buying a car is a significant investment — and it can be a stressful experience. Many consumers turn to the internet first when researching cars, hoping to ease the pain of the sales process once they get to the showroom. But that process can be just as frustrating because when they do want assistance from a dealer online, it can be hard to get.

To help ensure its online customers get the prompt and courteous attention they deserve, The Faulkner Organization, one of the largest multi-franchise automobile dealerships in Pennsylvania, employs an AI virtual assistant. The virtual persona “Megan” can create two-way, email-based communication, determine a lead’s intent in real time, alert the salesperson who should contact the lead, and more.

Faulkner’s internet sales department had previously struggled to keep up with the thousands of leads coming in from the company’s multi-brand website and other channels every month. Now, the AI solution automates the entire process of sales conversion for internet leads. (And by better engaging its customers, Faulkner has seen its qualified showroom traffic double.)

3. Mayo Clinic

Clinical trials can save lives, but patient screening and enrollment is a long and manual process. That’s obviously a big problem for people with serious conditions who don’t have time on their side. Mayo Clinic and IBM Watson Health are trying to make the process better. They are working together to match patients more quickly with appropriate trials. Their initial focus: cancer patients.

Mayo implemented the “Watson for Clinical Trials Matching” system in July 2016 in its ambulatory practice for patients with breast cancer. Nearly a year later, Mayo saw an 80 percent increase in enrollment for its systemic therapy clinical trials for breast cancer. The time needed to screen patients for clinical trial matches has also been reduced.

Based on the success of their first effort with breast cancer patients, Mayo is now collaborating with IBM to expand the matching system’s capabilities to include clinical trials for other types of cancer, including lung and gastrointestinal cancers.

4. Bank of America

Few people go into a bank and interact with a teller these days. If they’re missing that personal connection in their banking experience, Bank of America’s AI-driven virtual financial assistant “Erica” may help fill the void. She resides within the bank’s mobile app and customers can interact with her by using voice commands, texting and tapping on their mobile device.

Bank of America rolled out Erica to its 25 million mobile customers earlier this year. Erica uses advanced analytics and cognitive messaging to help customers with several common banking activities, from accessing account balances to scheduling payments to transferring money between accounts.

Bank of America has big plans for Erica — it looks to expand her capabilities so that she can handle more complex tasks, including identifying ways for customers to potentially save money.

The English-speaking virtual assistant is also expected to learn Spanish in the future.

5. Frontier Communications

The telecommunications industry is highly competitive — and consumers know they have choices. And if a provider doesn’t understand its customers’ needs or provide personalized service, those customers may walk. That provider will likely struggle to seal the deal with prospects, too.

Frontier Communications, the nation’s largest pure-rural communication company, uses Invoca Signal AI, which is used to identify call outcomes and caller intent in real time, to ensure it understands what its customers want. The solution automatically analyzes phone conversations to help Frontier Communications understand buyer intent, eliminating the time-consuming and resource-intensive process of manually listening to customers’ calls.

The call data Frontier Communications receives from Invoca Signal AI provides insight on why certain callers may or may not buy the provider’s services — for example, they may have concerns about pricing or they may find a competitor’s offer more compelling. The company, armed with knowledge about buyer intent, can then create personalized offers that are more likely to meet prospects’ and customers’ needs and help drive conversions.

According to Bryan Flores, group vice president, marketing and strategy, at Frontier Communications, the company’s marketing team can now use insights from Invoca to classify customer interactions by call intent and analyze the outcomes of calls as well as the root causes for those outcomes. And by relating that information back to the different types of consumers Frontier Communications services, the marketing team is able to identify patterns in customer needs and behaviors, and personalize the service it provides.

That information, Flores said, is valuable for helping Frontier Communications to improve not only the purchase process for prospects but also the experience for its existing customers.

4 Future Trends and Predictions for AI in the Customer Experience

As we look ahead to 2023 and beyond, these customer experience predictions offer insights into the evolving landscape of customer service and engagement. They also highlight emerging trends and advancements that businesses need to consider to stay competitive, and deliver exceptional experiences to their customers: 

1. Increased Adoption of AI and Automation: AI-driven technologies, such as chatbots and virtual assistants, will be more widely adopted in 2023. These intelligent solutions offer personalized support, faster response times, and round-the-clock availability, enabling businesses to meet customer demands efficiently. AI and Automation are already streamlining customer interactions and enhancing overall satisfaction, leading to reduced operational costs and improved customer retention. 

2. Focus on Hyper-Personalization: Customer expectations for personalized experiences will continue to rise and companies that leverage AI and data analytics to understand individual preferences will gain a competitive edge. By delivering hyper-personalized recommendations and targeted offers, businesses can foster deeper connections with their customers and drive loyalty. The significance of this trend is its ability to create tailored experiences that resonate with customers, ultimately leading to increased customer satisfaction and advocacy. 

3. Seamless Multi-Channel Experiences: With the growing number of communication channels, customers expect a seamless experience across all touchpoints. In 2023, businesses will prioritize integrating customer service platforms and data to provide consistent and cohesive interactions. This would then lead to unified customer experiences, reduction in customer effort, and ensuring a smooth journey, regardless of the chosen channel, resulting in improved customer loyalty and retention. 

4. Rise of Conversation Intelligence Technology: As we mentioned earlier, our research found 85% of call center managers are likely to implement a conversation intelligence solution in the next year. Conversation intelligence will rapidly change how companies deliver customer experiences by seamlessly bridging the gap between the online and phone channels, and capturing invaluable insights from phone conversations. Conversation intelligence allows businesses to easily identify trends from conversations at scale and make the right pivots to increase customer satisfaction.

The customer experience landscape is continuously evolving, and these predictions for the rest of 2023 highlight the need for businesses to adapt and embrace innovative technologies to meet customer expectations effectively. By using AI for personalized interactions, ensuring consistency across channels, and exploring immersive technologies, companies can create a competitive advantage and drive customer loyalty, ultimately achieving sustainable growth and success.

Additional Resources

Want to learn more about how leading customer care teams use Invoca’s AI to deliver better experiences at the contact center? Check out these resources:

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