Artificial Intelligence was once just a fascinating concept in science fiction, but now it is slowly becoming a major part of our lives.
As consumer demand increases, more and more businesses integrate AI into their core technology stack to provide their customers with faster, reliable, and personalized service, all while reducing overall operational costs.
One of these features includes AI chatbots, which are a great way for the customer to get instant support. So, in this article, we’ll take a look at AI chatbots, their benefits, and some real-world applications of the technology in customer service.
What are AI Chatbots?
AI chatbots use Natural Language Processing (NLP) to simulate human conversations through the use of Artificial Intelligence. While rule-based chatbots have existed for over a decade now, AI-powered chat solutions are still a relatively new thing.
Rule-based chatbots have pre-determined guidelines and look for specific keywords in the user’s message. This often leads to miscommunication and inaccuracies in the text. However, conversational AI tools use machine learning, NLP, and AI to determine what the user’s request means and provide a response according to their request.
This allows companies to provide real-time customer assistance. Not only does it help in improving response time and reducing operational costs, but it can also help provide features like personalized customer interactions and multilingual chat support. Currently, AI chatbots have two types: text-based and voice-based, and are being actively used in applications like customer service and e-commerce.
The Benefits of AI Chatbots for Customer Service
The use of artificial intelligence in customer service can bring a lot of benefits. Let’s take a look at some of them.
24/7 Availability
As a business, you always want to look for ways to save costs. Having human employees working day and night adds a lot of business expense. Not only that, the customer service quality depends on their situation and mood, meaning that the quality of service can shift from agent to agent. An agent attending their first call of the day is bound to have more energy and enthusiasm compared to one who’s about to clock out.
On the other hand, you can get the same quality of service and 24/7 support with chatbots. They are also able to handle customer queries during off-hours, which can help reduce wait times for customers.
Faster Response Times
Most customers don’t enjoy reaching out to customer support; they do it when something doesn’t work as intended. A majority of customers say that an immediate response from customer support is very important to them.
Today, immediate response means prompt assistance. So, while human response depends on agent availability, AI can respond instantly to a customer’s query. If AI can’t solve their problem, a human agent can always take charge and help out the customer. This will reduce the response times and improve overall customer satisfaction.
Cost Efficiency
The use of AI chatbots can help save around 30% of the costs associated with providing quality service. While a human agent can only deal with a few tickets at some time, AI can deal with several tickets at a time without causing any delay. The use of machine learning also enables automated learning where the AI chatbot can learn from previous experience and improve the quality of service it provides over time.
This can drastically reduce operational costs for businesses by automating a lot of routine tasks, minimizing the requirement of having large customer support teams.
Personalized Customer Interactions
Chatbots can help personalize the interaction when the user first reaches out. They can get information about the customers at a much faster rate compared to human representatives. Based on the information the AI chatbot gets, it can tailor the experience for the user faster and more accurately. The chatbot can make recommendations to customers based on their purchase history, preferences, and needs.
Based on other data, the AI chatbot can also make recommendations, provide useful messages, and anticipate the customer’s next move, which can lead to higher customer satisfaction.
Real-World Applications of AI Chatbots in Customer Service
Now that we know the benefits of using AI chatbots in customer support, let’s take a look at some real-world applications of technology in customer service.
Telecommunications
The Internet has gone from being a luxury to an absolute necessity. This is why issues with the internet can be extremely frustrating for users.
Using AI chatbots can be a great way to troubleshoot issues with internet, TV, and phone service. It can help improve customer service quality and reduce overall call volume. Some of the major internet service providers in the U.S. like Xfinity already use an AI chatbot in the form of Xfinity Assistant to help the customers troubleshoot issues with their connection. This chatbot assists the customers in finding the best Xfinity internet deals and other related options as per their needs.
E-commerce
E-commerce is a great way to implement non-invasive AI chatbots. These can analyze customer preferences and behaviors to offer them personalized promotions and recommendations. This can enhance the user’s experience as well as help boost sales through offers tailored for the specific user.
They can also be used to collect feedback from customers using personalized polls, surveys, and queries. Not only that, they can allow users to track their orders and even file returns without the need to go through arduous return processes.
Banking and Finance
AI chatbots can be great for financial institutions, not only for personalizing customer support for their customers but also for detecting any fraudulent attempts.
According to statistics, 32% of people in the U.S. don’t use mobile apps to manage or view their accounts. The use of AI chatbots can be a great way to bring new users up to speed on how to use banking applications safely. Banks can also set up AI chatbots to help customers with transaction information and loan applications, similar to the experience with a bank teller.
Travel and Hospitality
AI chatbots are great for use in travel applications since they can help with a lot of things that might require the support of a human agent. Chatbots can offer hotel recommendations, places to explore as well and trip planning in a conversational format. This can enhance the user’s convenience and simplify their trip-planning process. They can also help users book flights, check, and provide them with customer support during their travel.
Challenges and Limitations of AI Chatbots in Customer Service
While there are a lot of benefits and uses of AI chatbots in customer service, there are also some challenges that need to be addressed. Current AI chatbots are limited to answering simple queries and aren’t able to solve highly technical issues. AI also has a looming problem of data privacy, where ensuring the security of the customer is crucial.
Not only this, but a lot of customers are reluctant to use AI chatbots and prefer interacting with humans. This is mainly because AI can’t understand human emotions; it’s important to maintain human interaction to ensure the customer always has empathetic support.
However, with advancements in AI, machine learning, and natural language processing, we expect to see chatbots become smarter and more intuitive. As the technology matures, we expect to see its use in more industries, like education and government bodies.
