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Understanding the power of AI in customer service

Automate

1 min read

Understanding the power of AI in customer service

Automate

1 min read

Understanding the power of AI in customer service

Learn how businesses are combining AI and human agents to meet rising customer expectations.

The why is simple — your team will be able to do more with less and keep up with customer needs by incorporating AI into your support processes.

Customer service expectations have never been greater. Almost 60% of people have higher expectations for customer service than they did a year ago while the number of digital customer interactions around the world increased by 38%. All things considered, companies can no longer rely on the traditional methods of customer service.

More and more companies are turning to AI technologies in customer service to meet expectations and handle the influx of tickets. In fact, according to a survey by Deloitte Digital, 79% of contact centers plan on investing in greater artificial intelligence capabilities within the next two years.

What are the benefits of employing AI in customer service?

The return on investment for AI-powered customer service automation is substantial. Here are a few different ways in which it can help your business:


  1. Faster, self-serve resolutions

More than 30% of customers expect their problems to get resolved in a single interaction and 81% prefer self-service over speaking to a representative. 

By communicating with an AI chatbot or a conversational IVR system, customers can get faster resolutions to their inquiries. When integrated with third party systems and knowledge bases, AI chatbots or IVR systems allow customers to find answers to questions and even execute actions, like initiating item returns or managing appointments and bookings, all on their own, without the need to speak with an agent at all.

By empowering more customers to self-serve, your business can achieve faster resolution times and higher customer satisfaction.


  1. Lower costs

When customer support tickets increase, you need more agents to handle the additional volume. However, hiring new headcount can be costly, not to mention unscalable. Conversational AI solutions have been known to reduce customer service costs by up to 30% so your team can do more with less.


  1. Increase live agent capacity

AI-powered systems like chatbots don’t replace your entire support teams. Instead, they assist agents with handling high volume and repetitive customer requests and questions, so your team can spend more time on complex issues and high-value activities that build customer relationships. 

Live agents are more productive with chatbots simply because they can resolve more customer issues faster. 

Aramex, an international logistics and transportation company, implemented chatbots on several messaging apps like WhatsApp and Facebook Messenger. After implementation, Aramex's agents could automate recurring customer requests, almost tripling the number of customer conversations across platforms. 


  1. 24/7 availability

An AI-powered system never takes a day off. It’s available around the clock to respond to customer questions. Customers can contact your business at any time and always get a response. Without AI, businesses are either forced to hire 24/7 support teams (not always a feasible option) or make their customers wait until regular business hours.


  1. Personalization at scale 

When handling large volumes of customer inquiries, delivering personalized experiences can be challenging. However, AI systems can analyze customer data, purchase history, and previous interactions to provide tailored responses and recommendations. By leveraging AI, businesses can offer personalized support to every customer without increasing headcount or compromising on quality.

Understanding AI in customer service

Customer service entails listening to, understanding, and empathizing with your customers to resolve their issues and inquiries. Relying on technology to handle this process sounds counterintuitive at first. However, today's AI solutions have evolved far beyond simple automation – they can now engage in natural, meaningful conversations that rival human interactions.

Modern customer service AI leverages advanced technologies like Large Language Models (LLMs) and deep learning to understand context, generate human-like responses, and even detect emotional nuances in customer communications. These systems can maintain conversation history, understand complex queries, and adapt their responses based on the specific situation and customer needs.

Here are some ways that modern AI systems understand and process customer inquiries:


How language models power modern customer conversations 

At the heart of this evolution are Large Language Models (LLMs), which have revolutionized how AI systems interact with customers. Unlike traditional chatbots that rely on pre-programmed responses, LLMs can understand context, maintain coherent conversations, and generate human-like responses in real-time. This means they can handle complex queries, adapt to new situations, and even understand subtle nuances in customer communications – capabilities that were unimaginable just a few years ago.


How AI understands customer intent and context 

Working alongside LLMs, advanced Natural Language Processing (NLP) and Understanding (NLU) systems form the foundation of how AI comprehends customer communications. Modern intent recognition systems can now identify multiple requests within a single message and understand implied needs without explicit keywords. 

For instance, when a customer says, "I received my order yesterday but the size isn't right and I'm going on vacation next week," the system can simultaneously recognize the return request, the product issue, and the time sensitivity of the situation.


How voice AI enables natural conversations 

Perhaps one of the most exciting developments is the emergence of real-time Voice AI. These systems can now recognize speech with near-human accuracy, synthesize natural-sounding responses, and even detect emotions from voice patterns. 

Major retailers like Apple are already using this technology to handle customer service calls more efficiently, with their AI systems processing complex queries and switching seamlessly between multiple languages and accents.


How AI recognizes and responds to customer emotions 

Sentiment and emotion analysis has also evolved significantly. Modern systems don't just categorize messages as positive or negative – they can detect multiple emotions within a single interaction, understand cultural nuances, and identify urgency levels. 

This sophisticated emotional intelligence allows businesses to prioritize urgent cases and respond with appropriate empathy. For example, when a frustrated customer messages, "This is the third time I'm trying to resolve this!" the system can recognize the escalating frustration and route the conversation to a senior support agent.


How AI handles multiple types of customer input 

The integration of multimodal AI has opened up new possibilities for customer support. These systems can process various types of input simultaneously – from analyzing product photos for damage assessment to scanning documents for warranty claims. 

A customer can now send a picture of a malfunctioning product along with a text description, and the AI can comprehend both inputs to provide more accurate assistance.


How AI predicts and prevents customer issues 

Predictive analytics capabilities have added another layer of sophistication to AI customer service. By analyzing patterns in customer behavior and support interactions, these systems can anticipate potential issues before they escalate and recommend proactive solutions. 

For instance, if a customer's usage pattern suggests they might encounter a specific problem, the system can proactively provide guidance or initiate contact before the issue occurs.


How AI connects with existing business systems 

What makes modern AI truly powerful is its ability to integrate seamlessly with existing business systems. Today's AI solutions can simultaneously access customer histories, inventory data, shipping information, and knowledge bases to provide comprehensive support. 

When a customer inquires about an order, the AI can instantly access their purchase history, check current stock levels, and provide accurate, contextual responses.


How AI and humans work together in customer service 

This ecosystem of AI technologies works together to create a support experience that feels natural to customers while being highly efficient for businesses. We see customershandling 50% more customer inquiries after implementing these advanced AI systems, while maintaining high customer satisfaction scores. 

The key is that these technologies don't replace human agents – instead, they augment their capabilities, handling routine tasks while allowing human agents to focus on complex issues that require a personal touch.

What are some use cases of AI for customer service?

There are a lot of different applications of artificial intelligence in customer service. The most common ones include:


Conversational AI assistants 

Today's AI assistants are far more sophisticated than traditional chatbots. Powered by large language models, they can engage in natural, context-aware conversations across multiple topics. These systems can:

  • Handle complex, multi-step customer requests

  • Remember conversation context and previous interactions

  • Switch seamlessly between different tasks and topics

  • Provide personalized responses based on customer history

  • Generate creative solutions to unique problems

For example, major e-commerce platforms are using AI-powered assistants that can troubleshoot technical issues, process refunds, and even help customers brainstorm product usage ideas – all while maintaining a natural, human-like conversation flow.


Intelligent voice interactions 

Modern voice AI has transformed the traditional IVR experience into a natural, conversational interaction. These systems can:

  • Understand natural speech in multiple languages and accents

  • Handle complex queries without menu trees

  • Detect customer emotion and adjust responses accordingly

  • Switch between voice and digital channels seamlessly

  • Process multiple requests within a single conversation

Leading airlines now use conversational voice AI that lets customers modify bookings, check flight status, and resolve travel issues through natural conversation, without ever pressing a number or following a rigid menu structure.


AI-powered agent augmentation 

Rather than just suggesting pre-written responses, modern AI systems actively assist agents during customer interactions by:

  • Real-time translation of customer messages into agent's preferred language

  • Automatically summarizing long customer conversations

  • Drafting personalized responses for agent review

  • Providing predictive insights about customer needs

  • Identifying upsell opportunities based on conversation context

  • Fact-checking responses before they're sent

Major financial institutions are using AI to help agents generate personalized responses that incorporate specific customer history, previous interactions, and product knowledge.


Smart routing and predictive support 

Modern AI routing goes beyond basic skill-based assignment to create intelligent support experiences:

  • Predictive routing that matches customers with the best agent based on conversation history, personality matching, and predicted issue complexity

  • Proactive issue detection and automated outreach before customers report problems

  • Real-time escalation based on conversation analysis and customer sentiment

  • Automated follow-up scheduling based on issue type and resolution status

  • Cross-channel journey tracking and handoff

Global retail brands use AI to analyze customer messages in real-time and automatically route complex or high-priority issues to specialized support teams while handling routine queries through automated systems.


Visual AI support 

Modern AI can now process and respond to visual information in customer support:

  • Automated analysis of product photos to identify issues or damage

  • Real-time video assistance with AI-powered annotations

  • Visual how-to guides generated from customer photos

  • Automated document processing for returns and claims

  • AR-powered self-service troubleshooting

Leading technology manufacturers use visual AI to help customers troubleshoot device issues by analyzing photos of error messages or hardware problems, providing visual step-by-step solutions.


Automated quality assurance 

AI now plays a crucial role in maintaining support quality:

  • Real-time monitoring of customer interactions across all channels

  • Automated scoring of agent responses and customer satisfaction

  • Compliance checking for regulatory requirements

  • Identification of training opportunities

  • Pattern recognition for emerging customer issues

Global contact centers use AI to automatically analyze customer interactions, providing insights for training and quality improvement.

It’s never too late to get started!

AI has penetrated the world of customer service. Whether it’s through bots or smart ticket routing, businesses of all sizes from around the world are already using some form of AI automation to provide support. Great customer experiences, lower business costs, and higher productivity are just some of the benefits of the power of AI.

It’s good to have a partner that helps you figure out your needs and provides the necessary technology to automate your customer support functions. Bird offers a wide range of AI customer service solutions that you need to get started. 

Contact us to learn more about how we can help.

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