AI - The Secret Recipe Of Future CX

AI – The Secret Recipe Of Future CX

What can AI do for improving CX in the future?

The way consumers interact with businesses is changing dramatically. Organizations are using Artificial Intelligence (AI) for a range of activities such as achieving more sales, improving customer engagement, and speeding up operations. For example, airports around the globe are investing in mobile robots that assist customers with directions. Another example is “Xaiolce,” a Microsoft chatbot in China that already has a user base of 200 million with more than six hundred thousand calls during the first ten months of its launch.

In this article, we will explore the various ways in which Artificial Intelligence can be just the right armour for winning the battle of customer experience. We will start with consumer insights about the use of AI by a particular organization followed by assessing how organizations use AI for improving CX and what strategies can be implemented to augment customer experience in an AI world.

Consumers want AI interactions powered by human empathy

According to a report of Capgemini, in which many consumers were interviewed on being AI-aware, about 73% of the consumers stated that they are aware of having interactions powered by artificial intelligence and more than 69% were satisfied with such interactions.

While consumers prefer AI only interactions in certain scenarios and human only interactions in some other, 55% of them reported that they would prefer to have a combination of both. While AI is a big hit with consumers, 64% would like AI to have more human-like attributes while 62% are comfortable with human voice and intellect.

From this data, we can safely conclude that AI surely enhances the consumer experience.

Now that we’re clear with the what part – what consumers want from AI – it’s important to understand how organizations can implement the consumer demands in their processes.

As quoted by Enrico Maria Bagnasco, Head of Technology Innovation at Telecom Italia,

There is reasonable fear that if the interaction is not natural enough, people will skip virtual agents and look for the human agents all the time. This would be a failure for the project. Thus, the bar is raised quite high towards a good level of natural interaction, so that the customer is at ease with the robot.

To cater to the consumer demand of AI systems having more empathy, human-like intellect, and personality, organizations are investing by acquiring startups that are working in this domain. For example, in May 2017, Microsoft acquired Semantic Machines, an organization that does research on building conversational robots. Though a robot with cognitive and emotional features of a human will be welcomed, human-like physical features are unwanted. In the research cited above, 66% of the respondents also expressed their desire to be aware of whether they are communicating with a robot. Thus, organizations have a huge responsibility towards ensuring transparency in not just letting consumers know that they are interacting with a robot but also in the treatment and use of data collected via robots, which often includes sensitive personal information.

Consumers prefer a mix of human and AI conversations while making a high-end purchase decision. However, they look for an AI-only conversation while making a low-end purchase decision and both of them stand equally important while making a mid-range purchase decision. Thus, companies need to understand their products and their respective consumers to be able to integrate AI systems accordingly.

ROI vs pain points

Though most organizations are able to gauge customer expectations, very few of them focus on designing their AI systems around them. According to Michael Schrage, Research Fellow at the MIT Sloan School’s ‘Initiative on the Digital Economy,’

For many organizations, the AI implementation approach is more “capabilities out” than “customer in.” That is to say, the organization looks primarily at its core competencies, its capabilities, and the skills and talents of its people. It invests in AI mainly to improve the efficiency and effectiveness of those things without, frankly, bringing much of a customer.

A survey by Capgemini found out that, while only 9% of the organizations pay heed to consumer preferences while implementing AI, most of them consider automation as just another technology project and not the pillar around which many core functions of the company grow. As many as 62% of the organizations prioritize cost of implementation and as many as 59% prioritize ROI over consumer comfort while implementing AI.

If AI is the future of CX, then organizations should be cautious while laying down the grounds for it. Let’s have a look at how an efficient AI system can define the success of CX in the future.

How to efficiently implement AI to improve CX?

Greater customer advocacy and loyalty

According to the research by Capgemini, more than 53% of the customers prefer to share their positive experiences on social media. Further, more than half of the people with repeated positive experiences will stay loyal to the company thereafter and about 51% will go back to the same brand while repurchasing. Also, more than 38% of the consumers are ready to pay for a better experience.

Let’s take the example of Volkswagen. The German automaker has started to adopt AI-based capabilities for social media and text analytics. It rolled out Sales Cloud, Service Cloud, Marketing Cloud and Community Cloud about 18 months ago and has integrated the services across various stakeholder platforms, from dealers to the headquarters to keep them informed of the CX results. According to the CX Director Australia, Jason Bradshaw, the great benefit of gathering all the data is not getting completely different pictures each time, but having a thorough understanding of the customers’ feelings about the brand. It helps in obtaining nuanced information and then educating the dealers to explore the best path for better customer experience.

The research further delves deep to segment the customers based on their likelihood of showcasing a positive attitude towards an organization based on a good AI-enabled experience. Some of this attitude is in the form of increased purchase, increased frequency of purchase, good word of mouth both offline and online, and higher trust and loyalty. 25% of them are high benefit customers i.e most of whom have AI interactions on a daily basis, followed by 22% of medium-benefit customers i.e who preferred interactions enabled with a mix of AI and humans. 53% are low benefit customers, most of who preferred mainly human interactions. Following showcases the results,

Taking the next step forward

For organizations, it is important to utilize the full potential of the high benefit customers by aligning the offerings to the customer needs. Some of the characteristics of companies that are getting this right are:

  • Providing privacy and security of data
  • Putting consumer comfort and satisfaction before ROI
  • Adding features that would make AI more compelling to the customers

Following is an excerpt taken from the Capgemini report showcasing ways to build an effective customer experience strategy for an AI-driven environment.

The most important thing is, keep consumers at the centre of the AI initiatives. AI should be a strategic priority and should be implemented as a core business process and not as an added feature.

One fine case in point is Google. Sundar Pichai, CEO of the tech-giant, speaking at a town hall event in San Francisco stated, “AI is one of the most important things humanity is working on. It is more profound than, I dunno, electricity or fire.”

Also, it’s important for businesses to understand that AI is no longer a technical topic. Rather, it is a business need that needs to be treated as a strategic imperative.

How should companies deploy AI?

Organizations are implementing AI to streamline processes, increase operational efficiencies, and reduce cost. This process has led them to realize the importance of AI in the context of customer experience. Customers are becoming more and more aware of the context in which AI is being deployed, but they expect transparency on the organization’s side and also expect an AI-human enabled interaction. The few organizations that understand the finer nuances of customer expectations put CX as their first priority and tap into more consumer insights using the technologies at hand. By doing so, organizations make sure that no matter how intelligent the technology is, human touch still remains a key ingredient in the recipe of successful customer experience.


While consumers are more open to interacting with AI-driven robots and systems for a better experience, organizations still need to be careful about how AI is presented to customers. Following points summarize the key takeaways from this article:

  1. Based on the cited research, 73% of consumers are aware that they are interacting with AI-powered systems and almost 70% of them are even satisfied with such interactions. This shows that consumers are definitely engaging well with the right AI solution.
  2. Despite the high engagement, consumers still expect human-like behaviour from AI systems. On some interactions, consumers would rather interact with a human and not AI system at all. Therefore, organizations must carefully plot the right strategy for implementing AI for consumer interactions and seek regular customer feedback to be aligned with their expectations.
  3. Interestingly, ROI and cost is a major decision making factor when organizations are sanctioning implementation of an AI solution. What is important in such cases is to keep the customer in perspective too. An organization that has the clarity of how an AI solution would improve its customer experience would reap higher ROI in the long run.
  4. Organizations must drive customer advocacy and loyalty by making it easier for customers to achieve their goals. Make customer-centric decisions when implementing any AI system and you should reap the benefits of increased purchase, increased frequency of purchase, good word of mouth both offline and online and higher trust and loyalty.

How do you think AI will impact CX in the future?


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