64% of customers are preferring to converse with chatbots for simple queries. This growing trend shows us the high demand for faster and more efficient customer support. Customers across all sectors are expecting immediate and personalized customer service, no matter when or where they reach out for support. To make this a reality, businesses around the world are turning towards Artificial Intelligence (AI) for answers and positive results.
Such a tech product which has come to assist in this pursuit is AI chatbot. These small tools are designed to handle customer queries through text or voice. They are powered by Natural Language Processing (NLP) and Machine Learning (ML) and can understand customer inquiries very well to provide instant responses. Simultaneously, they handle a number of tasks while assisting customers as well. This allows businesses to provide 24/7 support and also handle large volumes of customers coming in for support. We’ll see how these AI chatbots work for the betterment for customer support across all industries and the limitations that come along with their benefits.
What is an AI Chatbot?
AI chatbot is an intelligent conversational system that is designed particularly to get engaged in human-like conversations with its assigned users. NLP helps these AI chatbots to actually understand and interpret human language and ML allows them to get trained from these interactions to improve their responses over time. With all the tech behind the screens, these chatbots can analyze the real intent behind the input that is being provided to them to give back context-aware replies, which makes them more advanced than other simple automated chat systems.
These AI chatbots can be divided into two – rule-based and AI-driven. You can use your imagination to decipher its nature from their names. Rule-based chatbots completely rely on the predefined scripts and give our responses to specific keywords or commands which will offer limited functionality. These kinds of AI chatbots are perfect to handle simple queries like FAQs. AI-driven chatbots are what we have already discussed. They use machine learning to understand the intent of the users and learn from each interaction they have, making them more dynamic and useful.
All AI chatbots are moving from the simple automated tool to more sophisticated conversational bots which can work and pose as support agents. Early chatbots that we witnessed a couple of years back were very basic and only focused on repetitive tasks. But with new innovation coming in, these chatbots are now capable of handling very nuanced and real-time customer interactions.
Benefits of AI Chatbots in Customer Support
24/7 Availability: One of the many reasons behind all the buzz of businesses running behind AI chatbots to offer customer support is the 24/7 availability feature that they possess. Unlike human agents who are limited by their working hours, these chatbots are available 24/7 providing customer support at any time regardless of time zones. There are AI voice chatbots too which can provide constant availability and customer satisfaction.
Instant Response Time: AI chatbots can deliver fast and immediate responses to the customer interactions they handle. They can do a lot of things like answer questions about products, solve any logistics problem or provide and much more. This reduces the wait times significantly and the prompt service makes the customers happy as they get quick resolutions.
Cost Efficiency: As all the repetitive tasks can be routed to AI chatbots, the need for human agents are reduced. This doesn’t mean that human workers are on the verge of being put out of work. All these benefits help businesses to assign more important tasks to human agents, which improves productivity and increases business growth. With the right AI chatbot development services, you can make your own chatbot to handle a large volume of queries and minimize the need to hire additional staff for peak periods.
Scalability: When times of high demand come, such as any holiday season or other sales events that you plan, all businesses face some sort of struggle to manage the influx of customer queries coming in. By integrating AI chatbots to your operations, you can handle the surge in interaction which allows you to scale your operations without the need for extra human resources.
Personalization: Finally coming to the point for which we are switching to chatbot AI development from traditional old chatbots. The personalization that is offered by AI chatbots is surreal, they make their interactions with users to be emotionally connected and relevant to the issue they are dealing with. They do this by accessing the data of customers like the past purchases, app browsing history and previous support requests. And, don’t worry, all this is done with absolute protection of privacy for your customers.
Real-Life Applications of AI Chatbots in Customer Support
AI chatbots are becoming indispensable tools across all industries they have been implemented in. The customer support they offer have streamlined operations for businesses and the user experience has been seen to improve a lot too. Here are some of the real world applications of AI chatbots:
E-commerce and Retail: E-commerce and retail industry was the first one to see tangible results from implementing AI chatbots in their operations. The applications that these have to provide in this industry are immense. They help to navigate the product catalogs, answer questions about product features, their availability and pricing too. These chatbots can create custom and personalized product recommendations based on the customer data that is being fed. They also handle and resolve queries regarding refunds, replacement and any logistics problem that might come along the way.
Several brands like H&M and Macy’s have successfully integrated AI chatbots into their business operations and have improved shopping experiences for their customers and reduced their operational costs.
Banking and Finance: Banking and Finance sector has to handle multiple routine inquiries which takes a toll on their human workforce. AI chatbots have jumped in and act as life-savers for this, as they are equipped with the right capabilities to assist customers with checking their balances, review the recent transactions that have been made, to transfer funds and manage account information. And, all this is done with several security and privacy policies in place, to keep customer information safe from fraud.
Bank of America’s AI chatbot, Erica, assists the users with everything like bill payments and account analysis. This drastically improves their institution’s operational efficiency and also makes the security strong and increases convenience of financial transactions.
Healthcare: Healthcare is an industry where every minute is of critical importance as lack of efficiency can lead to fatal things. In order to improve patient support and efficiency in other operations, AI chatbots are implemented. These chatbots help with scheduling the appointments, which offers patients the ability to book theirs easily, reschedule or to cancel them too. With the right data fed with a lot of medical policies in place, they can also provide preliminary medical advice by answering very basic health-related queries.
Babylon Health uses AI chatbots to provide remote consultations and health assessments to their patients. This has helped to reduce the burden on healthcare providers while offering more accessible services to their patients.
Telecommunications: AI chatbots are being widely used in telecommunication companies to manage the customer queries which are related to account management, billing and other troubleshooting issues. They help customers by handling billing questions, helping them to view their bills, understand the charges and make payments too. The troubleshooting they provide is efficient and they effectively guide the users to resolve issues such as network connectivity or other device malfunctions.
Vodafone and Verizon have deployed AI chatbots to provide faster, more efficient customer support to their users. They have witnessed a reduction in the need for human intervention to improve service delivery.
Challenges and Limitations of AI Chatbots for Customer Support
Complex Queries: AI chatbots excel at handling straightforward questions but can struggle with highly technical or nuanced inquiries. For complex problems requiring deep domain knowledge or detailed explanations, chatbots may provide inaccurate or incomplete responses. This can sometimes lead to customer frustration and may require any escalation to human agents for resolutions. This means, it also poses the risk of losing your customers.
Lack of Emotional Intelligence: Despite the advancements that come in AI, chatbots still lack the emotional intelligence that only human agents can bring to customer support. They are still unable to completely understand or express empathy in a way, which can be critical when handling sensitive or emotionally charged issues with customers, such as complaints or support especially for distressed customers. This makes it very difficult for AI chatbots to build a genuine rapport with your customers and to offer comforting responses.
Dependence on Data Quality: An AI chatbot’s effectiveness depends on the quality of the data that is used to train it. If the AI chatbot that you integrate is trained using incomplete or biased data, there are several risks involved in operating them. This can also lead you to a situation in which the responses it creates may be misleading to your customers. Continuous training and data validation need to be done to maintain the performance you desire, which can be resource-intensive in the long run.
Privacy and Security Concerns: When AI chatbots are made to handle sensitive customer data like customer’s personal details, payment information and medical records, there is always a little risk involved in securing the privacy of this information. While this may seem a big risk, with the latest innovative tech being integrated in AI chatbots, businesses can implement strict security measures like encryption and strict access controls to lessen the risks of data breaches.
Wrapping Up
The benefits that AI chatbots bring to the table are nothing short of a marvel. Businesses around the world are continuing to report better outcomes after implementing them into their operations. They reduce costs, improve efficiency and improve customer satisfaction through instant and personalized service. The ability to provide 24/7 support and handle repetitive tasks also make them very attractive to businesses. While enjoying the benefits, companies who use AI chatbots should be well aware of the challenges that come with them.
To create your own AI chatbot consider working with an AI chatbot development company with a wide range of expertise in developing AI chatbots for several industries. We at Shamla Tech offer innovative AI chatbot development services for businesses who are looking to improve their customer engagement and experience. Our AI chatbot developers are experienced in developing AI chatbots for businesses around the world.
Contact us today, to get a free consultation and a quote to develop a custom AI chatbot for your business!
