Four ways conversational AI benefits customer service industry

In today's competitive business environment, creating a connection with your audience is crucial for a brand to stand out from the crowd. And for the longest time, the best way to do that was through conversations. Communicating with the customer like this allowed brands to personalise their messaging, build trust, and forge a lasting relationship. 

A natural consequence of this was heightened brand loyalty and stickiness, and increased conversion rates. However, as brands scale up and expand their scope of operations, continuing to maintain a direct line of communication with their customer base becomes increasingly tricky. This holds especially true in the digital era, when where online interactions have quickly superseded face-to-face conversations. 

Given the resource and time-intensive nature of customer acquisition, brands have quickly sought a solution to this issue. The development of new technologies, and the recent advancements in AI, in particular, have presented a solution. 

This has come in the form of conversational AI, which allows machines to engage in human-like conversations that are intuitive, efficient, and personalised. 

With advanced AI and machine learning (ML) systems at play, this mode of automated customer service accurately simulates conversations with a human representative. This allows for extensive conversations to take place, with the AI providing context-specific responses across a multitude of customers simultaneously.

Customers are increasingly attracted to businesses with which they feel a personal connection. They want to patronise a company that they feel is open to having a dialogue with them, rather than seeking out a transactional relationship. Conversational commerce is a direct response to this desire, allowing customers to feel heard and respected by a brand. 

Businesses have recognised the importance of replacing the human touch the market for conversational AI in India alone was recently estimated at $2.8 billion, with a projected annual growth rate of a staggering 55%. 

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While every sector is poised to benefit from conversational AI, its impact will be especially profound in the customer service industry. Conversational AI has the potential to directly address many of the brand complaints today’s consumers have. 

Being able to freely communicate with a brand makes an individual feel seen and heard, and their opinion respected. Conversational AI and speech analytics enable these emotions by offering rapid service, streamlined interactions, and consistently personalised attention. 

This is especially relevant in the Indian market, where the nation’s linguistic diversity–and a longstanding penchant for language alternation–means that effectively communicating with a brand representative on the phone can often prove tricky.

All of this combines to measurably impact a company’s fortunes. Per Pew research, 86% of buyers are willing to pay more for a better customer experience, to say nothing of improved customer loyalty and positive word-of-mouth that results from a positive business interaction. 

Here are four ways in which conversational AI benefits the customer service industry:

Delivering better customer experiences

Customer loyalty is built through positive experiences. The implementation of conversational AI and speech analytics software is critical in resolving many of the most common issues customers have when communicating with businesses. 

For example, India’s linguistic diversity–our country has 22 official languages and thousands of local dialects–means that brands frequently struggle to effectively communicate with customers in their own language. However, a business that has adopted these tools is empowered to address them in their native language and dialect, vastly improving the customer’s outlook towards the brand, increasing their satisfaction, and building lasting loyalty. 

Similarly, conversational AI offers call analysis capabilities and real-time agent assistance, offering immediate suggestions to service representatives as they speak to customers. AI and speech analytics reduces the average handle time (AHT) and helps to increase the First call resolution (FCR) by equipping agents to handle customer queries, an indication of customer satisfaction. It also enables customer service executives to track ongoing complaints, offer customised resolutions, and provide tailor-made insights. Taken together, all of these factors combine to provide customers with a pleasant and memorable interaction. 

Improved efficiency

Conversational AI is an avenue through which businesses can massively improve their efficiency. By automating repetitive and time-consuming tasks in the customer service chain, such as responding to straightforward questions or retrieving information, employees are free to focus their attention on more important tasks or customer interactions. 

This allows businesses to adopt a tailor-made approach and dedicate more resources to pressing tasks. The automation of certain aspects of customer service also helps extend a company’s working hours and provide information to customers no matter the time or day, allowing facets of the business to operate 24/7.  

The increased incidence of fraud in recent years can also be countered through conversational AI. Through the application of speech analytics, AI systems can leverage the power of NLP and ML to analyse incoming calls, identify suspicious voice patterns and activities, and notify the concerned parties before any harm can be done. 

Deeper customer insights

Data is the foundation on which businesses are built, and conversational AI is ideally designed to collect information through customer interactions. 

Advanced NLP and speech analytics processes monitor conversations and track customer behaviour to provide the company with insights into overall customer trends, preferences, and choices. These details can then be leveraged to maximise operating efficiency and customer experience. 

On an individual level, customer data allows conversational intelligence to dive into an individual’s previous interactions and provide customised solutions and suggestions for how best to handle any given query. The more information gathered, the more personalised the ultimate interaction. 

Ensured customer satisfaction

A happy customer is a loyal customer, and a positive customer experience (CX) can be pivotal in shaping how a customer views a brand. 

A recent study by KPMG in India showed that 52% of customers made purchase decisions as a result of their experience with the brand, while over 90% of customers were likely to recommend a business to others after a positive CX interaction. 

This means that businesses in the customer service sphere cannot afford to upset their clientele. Conversational AI plays a critical role in helping businesses meet and exceed customer expectations at every stage of their interaction.

Conversational AI allows businesses to be available and responsive at any given hour, no matter how late. As an AI-operated system, responses aren’t dependent on the availability of a customer service representative, ensuring any queries are instantly responded to and eliminating any waiting time. 

Finally, the data-gathering capabilities of the system mean that every customer interaction will take place in the context of all previous conversations, making each chat feel personalised. 

Conversational AI emerges has proven itself a game-changer in today's customer service landscape. Establishing a genuine connection with customers is now a critical part of the industry, and AI technologies have revolutionised the ways in which this happens through new technologies such as ML and speech analytics. 

As the field continues to evolve, businesses seeking to gain a competitive edge in this space need to adopt conversational AI as an integral part of their customer-facing interactions. It’s only by fully leveraging its capabilities that brands can bridge the last-mile gap with their customers and drive long-term success.

Tapan Barman is the Co-founder of Mihup