Conversational AI will undoubtedly play a significant role in consumer experience this year. IDC's 2020 report predicts that conversational AI chatbots will handle over half of all consumer interactions. This number will only grow as businesses realize the importance of providing a great customer experience. Let's now look at how conversational AI is changing customer experience for the better, along with some of the possible challenges companies might face as they progress down this road.
What Is Conversational AI?
Conversational AI is an artificial intelligence that enables computers to have natural conversations with humans. It relies on machine learning and natural language processing (NLP) to create chatbots that can understand a human conversation.
The technology can offer hyper-personalized experiences that customers now expect across brands and products. It can facilitate dialogues with customers because it is not scripted or rule-based, significantly improving conversational marketing.
How Is Conversational AI Changing Customer Experience?
Conversational AI is changing customer experience in several ways:
- A more personalized experience - With conversational AI, businesses can provide a more personalized experience to their customers. This is done by using the data collected by the chatbot to understand the customer's preferences and needs.
- Faster and more efficient customer service can help businesses provide quicker and more efficient customer service. This is because chatbots can handle a large number of customer inquiries simultaneously. They can also route customers to the right agent, which reduces the wait time, and works 24/7/365, a huge advantage for businesses.
- Improved marketing - With conversational AI, companies can improve their conversational marketing capabilities and drive automation. This is done by using the chatbot to understand the customer's needs and then providing them with the right content.
- Real-time customer assistance - Conversational AI can provide real-time customer assistance. This means that businesses can address customer queries and complaints as they occur, significantly improving customer satisfaction.
- Improved customer engagement - Chatbots can keep customers engaged by providing instant feedback and engaging conversation. This helps to build a stronger relationship between the business and the customer.
Benefits of Conversational AI in Customer Experience
There are many benefits to using conversational AI in customer experience. Some of the most notable benefits include an uptick in customer satisfaction and loyalty, increased engagement and conversion rates, and cost reduction. Let us take a closer look at each of these benefits.
Increased customer satisfaction and loyalty
When customers have a positive experience with your brand, they are more likely to be loyal and recommend you to others. Conversational AI can help improve customer satisfaction by providing a more engaging and personalized experience. With chatbots, customers can get the help they need quickly and easily without waiting on hold or navigating through a complex website. This makes for a better experience and increased satisfaction.
Improved engagement and conversion rates
Conversational AI can also help improve engagement and conversion rates. Chatbots are very engaging, which means customers are more likely to stay on your website or chat with you for longer. This increased engagement can lead to higher conversion rates as customers are more likely to buy what interests them. Additionally, conversational AI can help reduce the number of abandoned carts. Customers will be more likely to return to your site if they can easily chat with a bot about their order.
Reduced costs and improved efficiency
Conversational AI can also help reduce costs and improve efficiency. Chatbots are a more efficient way to handle customer inquiries than humans. They can handle more inquiries at a reduced cost component, which means businesses can fortify ROI while providing excellent customer service. Additionally, chatbots do not require breaks or lunch hours, which means companies can save on labor costs.
Challenges of Conversational AI
While there are many benefits to using conversational AI in customer experience, some challenges also need to be addressed: