From hyper-personalised customer journeys to predictive customer service, AI is no longer a futuristic buzzword, but the engine driving a revolution in customer experience (CX) across all industries. 2024 marks the year organisations graduate from AI baby steps to a full-blown sprint, embracing its transformative power to create hyper-personalised experiences that anticipate needs and build lasting relationships.
Imagine a world where:
- Your favourite clothing store recognises you upon arrival, showcasing curated outfits based on your past purchases and browsing habits.
- The airline app proactively alerts you to a potential flight delay, offering alternative options and even booking a hotel room if needed, all before you even step foot at the airport.
- Your local coffee shop remembers your usual order and has it ready even before you speak, anticipating your morning caffeine fix.
This isn’t just a futuristic fantasy; it’s the reality being shaped by AI. And it’s not just about convenience. It’s about building trust, loyalty, and an emotional connection with customers that transcends mere transactions. Ivana Sekanic, Customer Experience Solutions Strategy, Qualtrics, comments, “AI is going to be a bigger transformative technology than the internet and mobile. And when we look at the early innovations and possibilities centred around experience management it’s easy to see why”.
She adds, “AI has the ability to help CX teams and agents quickly and confidently analyse customer feedback to identify and respond to points of friction or opportunities in their business in seconds; it is helping free teams from tedious manual tasks – like data entry and analysis – so they can spend more time delivering value to customers; and it’s helping managers better understand and address the needs of the teams they lead to drive improved outcomes for customers and employees”.
A quantum leap in AI adoption
2023 witnessed a surge in AI adoption, but 2024 will likely be a quantum leap. Fuelled by groundbreaking advancements in AI capabilities and increased consumer awareness of AI, organisations across industries are embracing AI like never before. Daniel Kimber, CEO and co-founder of Brainfish, comments, “Over the last 12 months, consumer awareness has really become apparent due to the generative side of AI. For 2024 the opportunity and the drive for companies to expand their use of AI will be driven around this increase in consumer awareness. People will have access to pretty much any piece of information at the tip of their fingertips in a way they want to hear it”.
This awareness will lead to greater familiarity and acceptance of the technology, where people become less fearful of its impact. Kimber adds, “The ability for AI to interpret what the customer needs and then match it and figure out exactly what is best to help them, I think is really going to transform the way people interact with the technology. It is going to transform the way they use the Internet; the way they interact with businesses and the type of customer experiences they will expect”.
Democratisation of AI
Previously, AI felt like a high-tech playground reserved for big end of town. Dr Asanka Fonseka, PhD, founder of NTENDER.AI, comments, “Small and medium-sized businesses (SMBs) and non-profit organisations face challenges in adopting AI, including limited resources, a lack of in-house expertise, issues related to data quality and accessibility, integration complexities, fear of disruption, perceived complexity, cost concerns, uncertain return on investment (ROI), and limited awareness about AI’s practical applications”.
“These challenges collectively contribute to hesitations in AI adoption, highlighting the need for tailored and cost-effective solutions, easy-to-use platforms, and supportive guidance to empower these entities to leverage the benefits of artificial intelligence effectively”, he adds. Today, advancements like low-code/no-code platforms and pre-trained AI models have democratised AI, making it more accessible to businesses of all shapes and sizes.
Personalisation on steroids.
AI algorithms, fuelled by vast data oceans, will learn individual customer preferences with uncanny accuracy. They will predict future desires, crafting dynamic website experiences that evolve with each visit, delivering targeted marketing campaigns that feel like personal whispers, and recommending products that appear like mind-reading magic.
Kimber comments, “We’re starting to move into a place where we can design customer experiences in real-time for every customer. Custom experiences can be designed for every individual user based on their demographic, what they are looking for, as an individual, and what kind of experience they want to have. And it can be done in real-time, without the company needing to configure that”.
“The ability for organisations to deliver these kinds of experiences will improve the way that users can use their products and the value they obtain from their purchases. In turn this will raise satisfaction, engagement and customer loyalty.”
Predictive service: Your CX crystal ball
But AI goes beyond serving up the right goods. It can now anticipate customer needs and proactively addresses them, eliminating friction and building unshakeable trust. Say hello to AI driven copilots, your virtual concierges, resolving issues in real-time and answering questions before you even ask. Predictive maintenance systems become watchful guardians, preventing equipment failures before they disrupt your day. And sentiment analysis tools become your early warning system, picking up on brewing customer dissatisfaction, allowing you to address concerns before they boil over.
As an example, Mad Paws, an Australian company that connects pet owners with reliable pet sitters used AI to identify and resolve customer issues swiftly, strengthening their customer bonds and streamlining their operations. AI gave the customer support team far greater capacity to respond to customer enquiries, generating significant productivity gains while giving staff more time to tackle more complex issues. Kimber advises, “It’s really important to make sure that we’re not taking away that human aspect when it’s required. The AI can handle routine enquiries about the service and the business, leaving more time for humans to handle the more complex problems or emotional situations that require greater empathy and understanding.”
Sekanic highlights, “In the era of AI, data is the greatest differentiator – the programs and models will only ever be as good as the data they use. AI models are constantly learning from every engagement and looking to continually drive improvements for the people using them. And so, when the volume and depth of insights being used are inadequate to meaningfully reflect the engagement or interaction they’re trying to represent, there can be a detrimental impact on the solutions offered”.
“In contrast, when AI models are fully enabled with the right data, they are more likely to be optimised for the task at hand because they have a deeper understanding of what is happening, why it is happening, and what needs to be done to solve it”.
Building trust with open doors.
With great power comes great responsibility, and in the realm of AI, transparency and explainability are king. Concerns about bias and data privacy are valid, and building trust requires showing your customers you care. Sekanic says, “While AI is at the peak of corporate excitement and expectation, it’s important to remember it’s also at the peak of customers’ mistrust and uncertainty. For example, just one-third of Australian consumers say they feel comfortable using AI-powered services and communications (compared to 48% globally), expressing concerns with a lack of human connection, misuse of personal data, the possibility people will lose their jobs, and service quality”.
Organisations need to prioritise ethical considerations in their adoption of AI. It’s not just about avoiding bad press; it’s about building deeper relationships with customers who value knowing their data is treated with respect. Kimber says, “Organisations should prioritise ethical and responsible AI implementation, demonstrating transparency and value to customers through their messaging and business practices. As AI continues to permeate every aspect of our lives, having a Responsible AI (RAI) framework in place is no longer optional, it’s essential. Whether it’s a standalone policy or integrated into existing data governance frameworks, organisations, regardless of size, need to establish clear guidelines for ethical and responsible use of AI”.
Key Components of an RAI Framework:
- Governance and oversight: Establish roles and responsibilities for AI development, deployment, and monitoring.
- Data ethics: Define standards for data collection, storage, usage, and security to ensure privacy and fairness.
- Transparency and explainability: Ensure AI models are understandable and decisions have clear rationales.
- Algorithmic bias mitigation: Proactively identify and address potential biases in AI algorithms and data sources.
- Human oversight and accountability: Maintain human control over AI systems and ensure accountability for outcomes.
- Impact assessment: Evaluate the potential social, economic, and environmental impacts of AI implementations.
The challenges and roadblocks
While the advancements in AI capabilities are exciting, integrating it into existing customer operations isn’t without its challenges. AI thrives on high-quality, readily available data. Organisations often struggle with incomplete, inaccurate, or siloed data, hindering effective AI training and implementation. Fonseka says, “There’s a growing need for people to learn how to leverage AI, not just be aware of it, and the fear of job displacement due to AI automation is a major concern. AI won’t replace most jobs entirely, but it will automate repetitive tasks, freeing up time for more strategic and creative work. Learning how to use AI can enhance your productivity and efficiency in various fields”.
Integrating AI with existing systems, especially those based on older platforms and tech stacks. Fonseka comments, “Older systems might lack the APIs, data formats, or processing power needed for seamless AI integration. Extracting and cleaning data from older systems for AI use can be difficult, and security measures might need adaptation. Maintenance and updates: Integrating AI might require ongoing maintenance and updates to both the AI solution and the legacy system”.
Alongside choosing the right technology and partner, organisations need to think about how they bring AI into their business and where they focus their initial investments and programs. Sekanic advises, “By aligning and prioritising investments in areas where they will have the biggest impact, and being transparent with employees, organisations can ensure AI is being used to deliver business impact while enabling and motivating teams to deliver success”.
Skilled data scientists, machine learning engineers, and AI specialists are in high demand and often come with hefty price tags. Smaller organisations may find it difficult to attract and retain this talent. Integrating AI requires a shift in mindset and skillset for existing employees. Organisations need to invest in training and upskilling programs to ensure their workforce can adapt to and leverage AI effectively.
The future is here, now!
The future of CX isn’t just about faster checkouts and targeted ads. It’s about forging meaningful connections with customers, anticipating their needs with uncanny accuracy, and exceeding their expectations at every turn. Sekanic concludes, “Organisations already using AI in their CX programs – or are about to imminently start – have a competitive advantage over their competition. This is because brands able to unlock purposeful AI within their experiences and services are well placed to be the leaders in their industry, be more agile, and deliver greater business efficiencies”.
In 2024, AI is no longer a futuristic novelty; it’s the key to unlocking a new era of personalised, predictive, and ultimately, more human customer experiences. So, are you ready to step into the future?