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How Chatbots Have Revolutionized Customer Service

June 25, 2022
in Tech
chatbots in customer service
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In a Norwegian paper published in the Journal of Internet Commerce, researchers found that nearly 30% of companies surveyed planned, or had already at the time implemented customer service chatbots on their digital platforms.

The same research paper estimates that by 2022, more than 70% of all online customer interactions will either involve or be conducted by Artificial Intelligence or AI-based technology.

Compared to figures from 2018, this is an increase of more than 55%, revealing the true magnitude at which customer service-centric chatbots are increasingly making themselves more present in the digital world.

Although a wide array of research has concluded that many consumers are somewhat reluctant to make use of chatbots, or perhaps willing to interact with AI-based chatbots to help solve mundane issues; some studies suggest that the use of chatbots can negatively impact retaining customers, and decrease company credibility.

We’ve reached a crossroad in our journey to modernize and revolutionize customer-focused interactions. But although many will steer clear from the use of modern technology to resolve customer issues, but how have chatbots improved and revolutionized customer service, we explore some questions below.

What Are Customer Service Chatbots?

Chatbots can wear many different hats, ultimately we can understand that chatbots are machine-driven, or AI-powered bots that can interact and communicate with humans through a process of machine learning and natural language acquisition.

This means that whatever software engineers program a chatbot to learn, study and obtain will be conducted via information available on the internet, and through natural human dialogue.

Are Chatbots Effective For Customer Service?

Chatbots have become increasingly helpful, especially throughout the height of the global pandemic in 2020. Chatbots have made it easier for companies, and large corporations to interact with clients daily, without the need for any human intervention. This means that customer service operations will be automated and fully functional 24/7.

A 2019 report by Cap Gemini revealed that not only are chatbots useful on sites such as Amazon, Google, Spotify, or food delivery services, but can also now be implemented in retail banking, insurance, and health sectors.

These virtual and non-human assistants have made it easier for companies to focus on larger issues, and minimize the need for mundane tasks.

How Do Chatbots Improve Customer Experience?

The results can swing both ways, as research has shown us. In some instances, it’s clear how chatbots can positively improve the customer experience, but on the other end of the spectrum, the results are not quite similar.

Pros Of Chatbots

  • Increase and improve customer convenience.
  • Effective and on-demand assistance, without the need for human intervention.
  • Well implemented chatbots can be a more affordable long-term solution.
  • Improved accessibility and immediate support.
  • More informative solutions are provided.

Cons Of Chatbots

  • Not all chatbots are created equally and can vary across each industry making it difficult to create a standardization of sorts.
  • Chatbots can negatively impact the trust and reliability of the company or business.
  • Failure in AI-based implementation rates varies between 25% and 50% for certain companies.
  • Chatbots and their technology aren’t yet affordable enough to be accessible to most or all companies.

What Type Of Company Uses Customer Service Chatbots?

Nowadays it’s certainly commonplace for a large array of companies and businesses to make use of chatbots. The integration of modern technology and software has made it easier for these companies to monitor customer experience, and find solutions to regularly occurring customer problems.

Companies That Make Use Of Chatbots Include, But Are Not Limited To:

  • Lemonade Insurance
  • Kasisto KAI Financial
  • Marriott International’s Hotel
  • Apartment Ocean Real Estate
  • Feebi Restaurant
  • Woebot Therapy
  • Babylon Healthcare

These companies were selected as the top seven best performing companies with chatbots of 2020 as reviewed and selected by Business Insider.

company uses customer service chatbots

To Conclude: Will Customers Like Chatbots?

It’s not a question that will always receive a positive outcome, but certainly, academic research and consumer data have proven that customer service chatbots have increased overall company productivity, and helped resolve customer-related issues faster and more conveniently.

For some LLC formation companies, customer service chatbots are a lot more efficient, helping to mitigate the use of human intervention – but on the other end of the spectrum, we can see how these chatbots will not always get the job right the first time. Thus, successful and well-rounded AI implementation is required from the very first step.

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