5 Ways Artificial Intelligence Is Transforming the Customer Experience

Elevate is a 33-year-old retail clothing brand that was struggling to keep up with the fast-paced changes in fashion and the increasing competition from online retailers. In order to stay relevant and improve the customer experience, Elevate decided to digitally transform itself by incorporating AI into its business operations.

One of the first things they did was to implement a chatbot on their website and mobile app to assist customers with finding the right products, such as recommending items based on previous purchases and browsing history.

They also used computer vision to power a virtual fitting room, allowing customers to upload photos of themselves and "try on" different clothing items to see how they would look. Additionally, the company successfully used natural language processing to analyze customer reviews and feedback, identifying common issues and using that information to improve its clothing line and other services. Their right use of AI led to increased customer satisfaction and sales.

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Individualized customer experiences have unquestionably become the foundation for competitive advantage.

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Elevate is just one example of how organizations can win by transforming and personalizing user experiences by tapping into a vast collection of customer data. Personalization now extends well beyond simply including customers' names in email pitches. It is the design goal for all physical and virtual contact points, and it is increasingly being powered by AI.

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AI In Customer Service

Artificial intelligence (AI) is rapidly revolutionizing customer service, transforming the way businesses interact with and support their customers. According to Servion Global Solutions, AI will power 95% of all customer interactions by 2025, including live calls and online conversations, including live calls and online conversations.

We are now at the point where competitive advantage lies in the ability to capture, analyze, and tap personalized customer data at scale, along with the use of AI to customize and optimize the customer journey. The obvious winners so far have been large tech companies that have incorporated these capabilities into their business models. However, small and medium businesses have also joined the bandwagon and created transformative data-driven experiences.

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Combining the physical and digital experiences of customers is the only way for SMEs to compete with digital natives like Netflix and Google.

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Let’s take a look at FIVE of the most significant ways you can leverage AI to improve your customer experience –

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Chatbots and Virtual Assistants: AI-powered chatbots and virtual assistants can interact with customers in natural language, providing quick and efficient customer service 24/7. They can handle a wide range of tasks, from answering frequently asked questions to book appointments and processing orders. By automating these tasks, businesses can free up their human representatives to focus on more complex issues while providing customers with quick and convenient assistance. Additionally, chatbots and virtual assistants can be integrated with various channels such as websites, mobile apps, social media, and messaging platforms, which allows businesses to reach and engage with customers where they are.

Voice and Language Recognition: Voice and language recognition technology can significantly enhance the customer experience by making it more convenient and efficient for customers to interact with businesses. With voice recognition, customers can use their voice to navigate menus, place orders, and make inquiries without the need for typing or manual inputs. This can be especially useful for customers on the go or for those with mobility issues.

Hyper-Personalization: AI-powered systems can analyze customer data and interactions, such as browsing history, purchase history, and search queries, to understand individual preferences and needs. This allows businesses to tailor their communication and product offerings to each customer, providing a more personalized experience.

Predictive Analytics: AI can be used to identify patterns and make predictions to anticipate customer needs, such as identifying which customers are most likely to churn. By using AI to enhance personalization, businesses can increase customer engagement, increase sales, and improve customer loyalty.

Fraud Detection: By analyzing large amounts of data and identifying patterns, AI-based systems can detect fraudulent activities such as identity theft, account takeover, and false transactions. They can also monitor customer behavior and flag any unusual activity, such as sudden changes in location or large transactions. This can help businesses to protect their customers from fraud and minimize the risk of financial losses.

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[Read More: The Future of Digital Transformation in the Modern Business Environment]

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Building a Winning Strategy

Enhancing customer experience is a complex task that requires companies to gather and analyze large amounts of accurate data about customers, their preferences, and their behavior.

Of course, all of the ways mentioned above are the best-case scenarios. The entire goal of using AI in this context is to make your customers feel known and cherished, just how Elevate successfully did.

We've all had a negative AI experience as well—AI that didn't go deep enough into our data points, didn't use the correct algorithm, or didn't have the right "emotional intelligence" to give us a personalized experience.

In those situations, AI can make things worse for your company. Thus, before jumping on the bandwagon, remember that all AI should be tested, re-tested, and tested again from your customer's perspective.