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Cognitive Technologies are Enhancing Customer Service

May 25, 2022


Consumers can be a fickle bunch. One bad experience can sour them on a brand for years, if not forever. Trying to satisfy customers during tumultuous times only makes the task that much more difficult. And the past couple of years have been volatile. Melissa Minkow (@Melissa_Minkow), Director of Retail Strategy with CI&T, writes, “The last two years presented a whirlwind of new challenges for retail, requiring businesses to explore sometimes experimental ways to cope with rapid change. It was also the period during which omnichannel took off, becoming a dire necessity.”[1]


Some retailers have managed to thrive during these challenging times. Minkow reports her company’s top ten retailers this year are: Target, Apple Store, Sephora, Home Depot, DSW, Levi Strauss, Nike, Walmart, American Eagle, and Ulta. The list of outstanding retailers, she reports, differs from the company’s 2021 list, which caused them to ask: “In a world where being competent is a table-stakes requirement, what does it take to be outstanding?” According to Minkow, “In retail, the answer is that it’s the seemingly small details that make for the biggest, most impactful consumer impressions.” Whether you call this customer service or customer experience, making a good impression on customers matters a lot.


As Minkow notes, omnichannel operations are now table-stakes for most retailers. That means customers expect a seamless, end-to-end experience whether they are shopping online or in a store. According to Deloitte analysts Andy Haas, Michelle McGuire Christian, and Ravouth Keuky, “AI can help organizations deliver the right offers at the right time and provide effective post-sales service — improving the end-to-end customer experience.”[2]


Cognitive Technologies and Customer Service


Great customer service begins with understanding consumers. That isn’t always easy. Haas and his colleagues explain, “For many companies, helping consumers make purchase decisions by delivering relevant content throughout the buying cycle is a top priority. However, the surge in digital channels, an increase in hybrid shopping behaviors, and heightened customer expectations have made it more complicated for companies to create dynamic experiences that equip consumers with the right information and incentives in the moments that matter.” Complicating this challenge is the fact that consumers can easily hop on and off the digital path to purchase. Haas and his colleagues explain, “As consumers navigate their purchase journey, they often flip between online and offline channels and are bombarded with messages on multiple devices. Companies are challenged to deeply understand their customers, where and when they shop, and what types of information influence their buying behaviors.”


Cognitive technology solutions, like the Enterra Shopper Marketing and Consumer Insights Intelligence System™, can help retailers gain a better understanding of their consumers. Gaining consumer insights, however, is not all cognitive technologies (aka artificial intelligence) can do to enhance customer service. Haas and his colleagues note, “Often, companies use AI to focus on a particular aspect of customer service, such as using data to identify timely offers. However, when AI is embedded with purpose and planning into critical parts of the entire experience, it can create a more holistic customer service solution.” In fact, Syed Balkhi (@syedbalkhi), CEO of Awesome Motive, believes cognitive technologies are the future of customer service. He writes, “Customer service roles are under much pressure these days to find new ways of dealing with complaints efficiently while still providing high-quality support. … Managing your customer support in the modern age is a job of its own. And if you want to scale it, then you need to seriously consider adding AI to the mix.”[3] Below are a few of the ways experts say cognitive technologies can be used to enhance customer service.


• Chatbots. Josh Streets (@JoshStreets7), CEO and founder of Scoreboard Group Consulting, notes, “One of the most common uses of AI in customer service is chatbots. Businesses already use chatbots of varying complexity to handle routine questions such as delivery dates, balance owed, order status or anything else derived from internal systems.”[4]


• Customer Relations Management. Balkhi explains, “One great way that companies are using AI is by integrating it with their CRM software. … As a business’s transactions increase, it becomes harder to consume all the data that gets collected. Forget about analyzing it and finding out important patterns and trends. In such cases, using AI tools and integrations is a no-brainer.”


• Agent Assist. Personal, human customer service remains the gold standard for most consumers. Boston Consulting Group analysts observe, “Customer service is too important to get wrong, and yet many companies continue to optimize for cost and speed at the expense of the customer experience.”[5] Even when humans are involved, they say that consumers can be frustrated if the agent doesn’t have a ready answer. They explain, “The overspecialization of agents, leading to calls and requests being handed off [can frustrate consumers].” Streets notes, however, “In many modern omnichannel contact centers, agent assist technology uses AI to automatically interpret what the customer is asking, search knowledge articles and display them on the customer service agent’s screen while they’re on the call. The process can save time for the agent and the customer, and it can decrease average handle time, which also reduces cost.”


• Self-service. Today’s consumers commonly use search engines or YouTube to find answers to their questions. It should come as no surprise, then, that they are also willing to look for answers on retail websites. Streets asserts, “Most customers, when given the option, would prefer to solve issues on their own if given the proper tools and information. As AI becomes more advanced, self-service functions will become increasingly pervasive and allow customers the opportunity to solve concerns on their schedules.”


• Smart Speakers. According to Streets, “Smart assistants such as Alexa, Google Assistant, and Siri are an exciting avenue for personalized service. Customers appreciate and prefer when an organization communicates via their preferred platform, and for some people, that may be via their smart home device.”


• Other Uses: Other areas where customer service can be enhanced using cognitive technologies include: Analyzing user-generated content; agent training; scheduling demos and meetings; conducting sentiment analysis using advanced analytics; interactive voice response (IVR); and natural language processing (NLP).


Concluding Thoughts


Haas and his colleagues note, “Implementing a dynamic end-to-end strategy requires a deep understanding of a company’s current customer experience capability and opportunities to improve it.” According to Minkow, most companies learned that lesson the hard way at the outset of the pandemic. She writes, “Prior to the pandemic, the power struggle between brands and consumers was more or less controlled by the pace at which retailers decided to innovate. Suddenly, they could no longer control the shopping narrative. Consumers had needs they couldn’t compromise on, such as urgency of getting personal protective gear, and not being able to go into physical stores for retrieval, browsing or research. Brands were forced to put into action every omnichannel initiative they’d ever even thought about.”


Balkhi notes, “Chances are that your competitors are exploring ways to improve their customer service using AI.” He cautions, however, “Adding AI is not a catch-all solution. You still need to maintain and train real customer support staff to talk to customers about issues that AI tools can’t handle.” The Boston Consulting Group agrees with Balkhi. They conclude, “As technology improves, companies are increasingly automating customer service requests. Their intention is to increase the speed and quality of service, while lowering the cost. Automation can be amazingly effective for routine tasks, but it is often incapable of dealing with the long tail of more idiosyncratic requests that require human intervention.”


[1] Melissa Minkow, “The New Kings of Retail Are Focused on Customer Service,” SupplyChainBrain, 16 March 2022.
[2] Andy Haas, Michelle McGuire Christian, and Ravouth Keuky, “AI Strategies to Supercharge Customer Service,” The Wall Street Journal, 17 February 2022.
[3] Syed Balkhi, “Why Artificial Intelligence is the Future of Customer Service,” Customer Think, 17 January 2022.
[4] Josh Streets, “10 examples of AI in customer service,” TechTarget, 2 December 2021.
[5] James Sattler, Bodo von Hülsen, Payam Djavdan, Peter Hildebrandt, Edzard Wesselink, and Jack Clarkson, “The Future of Customer Service Is Fast, Lean, and Agile,” Boston Consulting Group, 4 January 2022.

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