How to Leverage Artificial Intelligence for Customer Service

Tony DoLast updated on January 2, 2024
7 min

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With high-profile advances in software like ChatGPT and DALL-E gaining public attention, it seems like artificial intelligence—AI, for short—is taking over.

Do you feel like you’ll be left behind if you don’t start implementing AI technology? Deloitte’s 2022 research on the state of AI found that 45% of respondents were already using AI in their customer service. Among business leaders, 94% agreed that AI would be crucial to success for the next five years.

It’s quite easy to incorporate tools with AI in customer service. The real challenge is figuring out how to use it efficiently and bring value to your audience.

Here, we’ll go over how to use artificial intelligence in customer service and why you should consider using some of these tools.

Let’s dive in.

What Is Customer Service? 

Customer service is every service your business provides to help customers. Most customer interactions offer you opportunities to provide customer service. 

It can be reactionary, like helping a customer with a problem. Or proactive, like when you anticipate their needs and make that information available beforehand.

Customer service comes in many forms, both in-person and online. Sometimes it involves direct, effective communication with customers via phone, email, or social media. Other times it involves options like self-service (e.g., knowledge bases and chatbots), which let customers find answers independently.

What Kind of Customer Service Should You Offer?

The type of customer service options that work best for your business will vary depending on your industry and the customers you serve. 

For example, one of the things you should prioritize if you primarily serve people in their 30s and 40s is email support. After all, research showed that 41% of people within that age group said email is their preferred contact method.

The average Millennial customer prefers email support slightly more than phone support and much more than other customer service options.Source

In contrast, the same report found that 38% of Gen Z respondents preferred to get customer service via phone. If that’s your demographic, you could take advantage of the many benefits of phone integrations and enhance the user experience by using AI in your customer service.

The average Gen Z customer prefers a phone call slightly more than other customer service options.Source

You can also use customer relationship management (CRM) software to track customer questions and interactions. That way, you can collect data on which customer support channels are most popular to decide which channels to prioritize going forward. 

Why Is Customer Service Important?

When you show customers you value them and offer a smooth customer experience, you build trust and create more cross-selling opportunities. And instead of only chasing new customers, you can focus on building long-term, loyal customers who will act as promoters for you. 

Let’s explore more reasons good customer service matters.

Customer retention

In 2020, Alvaria quizzed American consumers on the companies they stopped doing business with due to poor customer service. Among the results, a whopping 25% of consumers reported leaving their cable companies because their customer service wasn’t up to par. 

The customer churn rates across different industries in the United States in 2020.Source

Keeping existing customers is much cheaper than gaining new ones. Not to mention that an increase in retention as small as 5% can boost your revenue by at least 25%. Treating customers well is a surefire way to entice them to stick around. 

Brand loyalty

A 2023 survey from PwC found that 36% of people pointed to customer service as the reason they developed trust issues with a company. Conversely, providing excellent customer service is a way to develop fiercely loyal customers.

Even if you build customer loyalty by rewarding users with discounts or generating a brand kit that makes people recognize and resonate with your brand, whether you provide excellent customer service can make or break your business. 

Word of mouth

When you provide good customer service, you encourage customers to share positive experiences about your business. In that sense, customer service is another opportunity for marketing.

Data for marketing

Customer service can go hand in hand with marketing. Proactive tools like automated outreach and chatbots can use artificial intelligence to promote products your audience may already be interested in.

You can also gain unique insights by combining customer service and marketing tools. For example, customer service interactions can reveal users interacting with products in ways your marketing team never considered. Now your marketing team can set new expectations or promote new use cases.

How Can Artificial Intelligence Create Better Customer Service?

Now that we’ve gone over why customer service is important, let’s explore how you can capitalize on the benefits of artificial intelligence in customer service.

Companies can leverage AI in customer service to optimize workflows 

AI isn’t all about replacing your customer service team. Instead, it’s there to help them get more work done.

According to DMG Consulting, there are two main ways to implement AI in contact centers. Either attended, which means working with customer service agents, or unattended, meaning automation that doesn’t require human supervision.

For instance, you can use AI solutions in an unattended way to sort and categorize customer service tickets in real-time, based on which customers have the most urgent issue. That would help your reps prioritize satisfying the customers who are most likely to become frustrated.

In contrast, you can use attended AI to optimize workflows after collecting data. For example, you can connect your phone support with an AI that collects call-tracking metrics

That would enable you to determine which types of customer queries your reps typically spend a lot of time on. Then managers can review these queries to see why those calls take longer and make changes to how you address those types of calls.

While current AI works more in analyzing data, it’s advancing quickly with machine learning. Using natural language processing (NLP), we’ll soon have new AI content tools that could replace part of the creative aspect of customer service. 

HubSpot is creating tools like ChatSpot to take advantage of AI in customer service.Source

AI allows companies to reach more customers, quicker

Some AI tools can connect to CRM software to provide your support team with information such as a customer’s marketing data, purchase history, and past queries. 

Customers will be pleased that the support team already knows which version of a product they have, how old it is, and if there are any steps they should take to fix the issue. And your customer service representatives will be happy they can switch to the next call faster. 

AI can also help directly with call center issues like call routing. Aircall features call routing functionality that follows your multi-level interactive voice response system, ensuring customers reach the best department for their questions. 

With AI handling logistics, you’ll connect faster, dealing with fewer transfers and annoyed customers.

AI can also solve immediate challenges and guide the customer

McKinsey’s Global Survey on AI found customer service optimization was the main way companies used AI in 2022. Customer service analytics and customer segmentation were also popular choices.

The reason companies are using artificial intelligence in customer service is that it works. In the same survey, McKinsey found 45% of respondents said using AI in service operations decreased costs, while 57% reported an increase in revenue.

One of the biggest benefits of AI in customer service is how fast it can search and contextualize information—much faster than a human ever can. A great application for this is knowledge bases. You can enter information about your products, company, policies, and so on. 

Customers can ask questions to AI-powered chatbots, which will search your knowledge base and deliver answers to the customer. Ideally, your customer walks away satisfied, without any time required from your support team.

And remember, you can also use AI to gather data from customers. With conversational CRM software, you can link chats in Facebook or another messaging service to customer data in your CRM.

By combining HubSpot’s CRM with Aircall to improve customer service by phone, Summit Solar grew its call volume by 17% and increased its quotas by 10%. Staff used Aircall’s features, like automatic call logging, to streamline workflows and capitalize more on the data collected. 

Simply put, you can offer better service to more customers by taking advantage of artificial intelligence in customer service.

Using Artificial Intelligence in Customer Service

With customer service being crucial to retaining customers, you’ll probably want to take advantage of these options. Adding AI to your existing suite of service tools is easier than you might be thinking too.

Many tools for AI in customer service can be adopted a la carte so you don’t have to dive into anything full-scale if you aren’t quite ready. You’ll also find that many of these options are similar to the software you already use.

Adding AI tools to existing channels, like your call center, is a great place to start. Try Aircall’s inbound call center software today. Cut down on manual data entry and connect your call center to your CRM software to access customer data for personalized, faster calls.

About the Author

Tony Do is a graduate from University of California San Diego and is a Marketing Manager, Digital Marketer, and SEO Strategist for HubSpot. Outside of marketing, Tony explores the forests of Portland, Oregon and produces content for his marketing firm.

Published on May 29, 2023.

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