How Can AI Improve Customer Experience?

Artificial intelligence has crept into our daily lives through the technology we use, from searching Google Maps and taking an Uber to organize an overflowing inbox. Yet when it comes to commerce, AI remains a matter of huge potential.

Recent research from PwC found just 10 percent of consumers currently own an AI-enabled device, but almost a third said they plan to purchase one.

Some parts of the world have been much quicker to adapt to AI than others. One in five respondents in China – twice the overall average – already own an AI-enabled device.

Meanwhile, 45 percent of store owners plan to use AI for their business within three years. Wisely so, since stats reveal 18 percent of consumers who own an AI device end up spending more on shopping.

The customer experience of AI

AI may increase efficiency and savings for businesses, but what effect do AI interactions have on the customer experience, and how can this affect sales?

Research by CapGemini reveals that over half of consumers (55 percent), say they are comfortable interacting with company chatbots and virtual assistants. That leaves a full 45 percent who are not comfortable with AI. That’s a sizeable chunk of each market yet to be convinced of the benefits of AI.

It’s therefore vital to incorporate AI into a business in a way that extends beyond the bottom line and enhances the customer experience as well.

A machine with the ‘human’ touch

Looking into what consumers do like about AI shows that some ‘human-like’ features, such as a real voice and smooth conversational skills, help generate a feeling of goodwill in the customer. This increases the likelihood that they will spend money after interacting with the AI.

So when it comes to improving customer experience with AI, retailers must get past the convenience of 24/7 chatbots and automated product recommendations if they want to get their customers onboard and spending more. AI must also incorporate the kind of social skills we expect from its human counterparts to ensure a satisfying buying process.

Stay out of ‘uncanny valley’

Not all human-like features are welcomed by consumers. Give a robot too human-like physical features and your customer careens straight into what’s known as ‘uncanny valley’, where they find the bot unsettling, or “spooky” and “scary” even.

A focus group participant in France said: “Having a human-like AI-based robot would be too spooky, like those dolls that look like real babies.”

Another in Germany stated: “They are machines and they were made to help, but I would find it scary if they looked like real humans.”

Keep customers in the know

Almost two-thirds of consumers feel It’s important to know exactly when they are interacting with AI instead of a human. This is especially acute in the finance industry, where 71 percent insisted they needed to know.

Non-disclosure has the potential to erode trust. One US research participant described feeling “foolish” upon learning they were interacting with an AI system rather than talking with a human being.

He said: “Organizations should be clear whether it’s a computer or a real person that we are interacting with. Otherwise, there’s no trust if you think you were speaking to a real person the whole time or, if you found out later, then you feel foolish.”

The emergence of AI alter-egos

There is one potential function of AI that consumers appear enthusiastic about, and that is digital assistants. Almost half of the respondents said the idea of having their own AI alter-ego to delegate tasks to would be “exciting” and could “enhance their lives.”

“I think I would be good with it making appointments for me such as spa appointments or car servicing appointments,” said one respondent. “I would love for the assistant to pay my electricity and other utility bills for me. I am good with anything that is going to make my life a little bit easier.”

These AI alter-egos could have massive ramifications for how a company markets its brand. What happens to engagement between a company and its customers, once the human is largely out of the equation? How should a company’s AI interact with a customer’s AI? Could technology sever the emotional link between a company and its customers, something so intrinsic to modern branding? These questions cannot be answered yet.

The customer is still key

The Capgemini research identified some companies which have fully entered the AI race, using it to target new shoppers, make product recommendations, engage with their customers and protect and authenticate transactions.

It found these companies put customer experience at the heart of every AI-initiative, making it a priority over cost and ROI, and as a result, their customers felt they gained more benefits from AI and embraced it more than others.

So for businesses to successfully incorporate AI, the consumer must still come first. Satisfying customer experience with AI is intrinsic to building consumer confidence in the new technologies that are shaping the future of commerce.