“There is only one boss. The customer. And he can fire everybody in the company from the chairman on down, simply by spending his money somewhere else.”
What differentiates a customer from a brand loyalist? It’s Customer Service, predominantly.
A study revealed that every year, US companies lost more than $62 billion because of poor customer service. It also found that 77% of customers were likely to recommend a product or a service to their friends after having a positive experience with the company. These stats are clear proof of evidence that prompt customer service, authenticity, and personalization are the secret to happier customers and greater profits.
For the last four consecutive years, data analytics has been identified as the main driver of customer satisfaction and customer experience (CX). Data analytics lets you visualize trends in customer behavior. Furthermore, combining analytics with intelligence (AI-powered data analytics) not just spots trends but can also make predictions about individual customer behavior with uncanny accuracy.
Customer service is getting a gigantic makeover with AI-powered analytics in providing convenient, intelligent, and informed customer experience at any point along the customer journey and here’s how –
Automation in Customer Communication with Chatbots and Virtual Assistants
It’s 4 A.M on Monday morning. James, a design engineer, is busy preparing a presentation on a new product: an ergonomic standing desk. Somehow James was busy over the weekend and now is on a time crunch to finalize the presentation for the product. James now opens the product design application to login and now the application asks for an activation code. James is in harum-scarum all of a sudden and searches for the activation code on his cloud storage and inbox but no luck. He then calls the design software company’s customer service desk assuming they offer 24×7 round the clock support. James begins to panic as a recorded response greets James. He then notices an option to talk to a Virtual agent on the website. In less than 3 minutes, the chatbot is able to decipher his question and guide him on the next steps to access the activation code. James breathes a sigh of relief as he enters the activation code on the application and retrieves all the required documents needed to finalize the presentation. He nails the presentation Monday morning and earns the much-needed accreditation for his efforts. The design company that created the application James uses clearly knows that to wind up with a happy ending, rendering round-the-clock digital support is of incredible value.
According to Gartner, 85% of customer interactions will be managed without humans by the end of 2020.
Enter the era of customer service automation!
From ordering coffee to scheduling appointments with doctors, customers are in love with automation and so are the companies. Automation in enhancing customer experience and customer communication has always been a tempting likeliness. Chatbots and virtual assistants are gaining popularity in automating customer service workforce and the stats say so too –
Gartner predicts that by the end of 2020, an average individual will have more conversations with a chatbot than their partner.
Global Market Insights reported that by 2024 the chatbot market will be worth $1.34 billion of which 42.52% will be dedicated solely to customer service.
A recent Salesforce study reported that 53% of service companies expect to make use of chatbots in the next 1.5 years – a whopping 136% growth rate.
Experts predict that chatbots will be responsible for $8 billion in annual savings by 2022.
Chatbots and virtual assistants, the ripened fruits of AI, are creating a major impact in the CX and customer service world and here’s why –
- They never sleep and provide customers 24×7, 365 days round-the-clock support
- Customers don’t have to wait on long-hold music to connect to the next live agent.
- They help foster brand loyalty by making friends and building relationships.
Once considered a technological revolution, chatbots and VA’s are today merging into a strong evolutionary stream for fantastic CX and are the future of brand engagement.
Predictive Personalization – Serving Up a Personal Touch with Analytics
60% of organizations consider customer analytics crucial to the business which is likely to reach 79% by 2020 with a major driver being personalization.
AI-powered analytics is helping organizations create experiences that naturally integrate with consumers’ day-to-day lives. Intelligent personalization and prediction will make customers feel as if every service or product experience is particularly customized for them. Personalization also helps organizations fine-tune every aspect of the marketing mix for individual customer persona in real-time. Data analysis is the magic wand to predict a customer’s next move in the business model and reap better profits. Organizations have paved more accurate paths to ROI by personalizing content to target a specific set of leads by using historical data and analyzing the past behavior of customers. Serving up a personal touch to the customers with analytics can bring in greater revenue, higher engagement, and increased conversions to the sales funnel.
No list of predictive personalization is complete without a mention of Netflix. 80% of what users watch on Netflix is due to personalized recommendations. Everything that Netflix does is based on used data, right from the TV shows it creates to the movies it promotes. Netflix collects huge amounts of user data like their watch history, preferences and ratings, demographics which is fed to an AI-powered algorithm that predicts what a user will want to watch next. A strong predictive personalization system has helped Netflix save approximately $1 billion every year in customer retention.
Predictive Analytics to Reduce Churn Rate
Churn, also referred to as customer attrition, is a measure of how many customers stop buying from your company. Customer churn is an evil that all enterprises dread because the cost of acquiring a new customer is 5x more than the cost of retaining an existing one. Predictive analytics helps reduce churn rates drastically by understanding the important factors of customer attrition, identifying the customers who are most likely to stop using a service or a product, and providing targeted insights on what kind of retention actions need to be implemented for a specific customer segment.
With the use of predictive analytics, Sprint, a tier-one US carrier serving over 60 million customers has successfully transformed the way it interacts with customers and has drastically improved the customer experience. Earlier, customer services agents would manually analyze user data which was ineffective and tedious. Sprint now makes use of an AI-powered algorithm that identifies the customers that are most likely at the risk of churn and takes charge of sending personalized retention offers. The algorithm predicts what customers want and sends them offers for the relevant product when they are at the highest risk of leaving the company. This has helped Sprint revolutionize customer experience with a 10% reduction in customer churn and an 8x increase in customer upgrades.
Analytics powered with AI is crucial to a customer service team as it helps them work less on assumptions and more on actual facts. Organizations should leverage analytics in a way that it creates amazing customer experiences and compels them to keep coming back for more.
Building the right analytics foundation is crucial if you really want to generate the biggest benefit in enhancing CX.