Three steps to improving customer engagement with AI
Last year, InsurTech Rising’s editor-in-chief, Oisin Merrins, discussed the recent surge in interest in artificial intelligence (AI). Merrins noted a whopping 300% increase in investment compared to 2016, and made the great point that AI is nothing new.
Thanks to the falling cost of computing power and the rising capability of memory capacity, it’s undergone a rapid evolution in recent years. Yet, it also has a long history. Humans have spent years trying to find that magical formula. How exactly can we imbue man-made machines with human intelligence?
2017 looked like the year those efforts would translate into tangible change, and 2018 follows on a similar vein. Here are three powerful steps to improving customer engagement with AI, and a note on what AI can do (and what it can’t):
Step one: design new customer-centric experiences
For years, companies have been amassing personal and behavioural data from their customers. Until now, much of this data has been stuck in computer systems. However, as Forrester summarises in their October 2016 report, that’s all set to change: “2017 will be the year the big data floodgates open, driven by a voracious appetite for deeper contextual insights that drive customer engagement.”
The usage of sophisticated AI technology will allow companies to build their services around the customer. Generic products and marketing strategies will soon become redundant as the customer grows to expect a product tailored around them, and their individual set of wants and needs. Services, particularly in the banking and insurance industries, will be forced to become customer-centric.
That’s what moved the team behind SPIXII. The three founders set out to rethink the relationship between insurance companies and their customers. Their chatbot aims to place the customer at the centre of the experience.
Step two: use this understanding of the customer on social media
How did businesses traditionally start? You know the answer. They started selling their product face-to-face, knocking on doors, handing out leaflets and setting up market-stalls. After that, they might open a shop or agency on the high street. Then some companies started selling products and services by phone, while others saw their sales move online.
And now? Social media is where the majority of businesses are starting.
After all, it’s where:
- Customers source their news;
- Chat to their friends;
- And see what brands they’re engaging with.
According to The Ambassador, 71% of consumers satisfied by a brand’s customer service on social media are likely to recommend it to others. And 95% of adults aged 18-34 are most likely to follow a brand via social networking (MarketingSherpa).
Brands must develop relationships with the customer through social media, via storytelling and creating opportunities for dialogue. It’s crucial that they feel as human as possible. No-one feels warmth or indeed loyalty towards a corporation.
So how does AI come into this?
AI will bridge the gap between social media and face-to-face engagement. Using AI and customer data, companies will be empowered by knowing vital points such as:
Who the customer is;
- What they want;
- What they can afford;
- Their pain-points;
- And even something as small (but significant) as their tone of speech.
This new strategy of conversational commerce works across industries. In fact, it’s already been used to sell everything from luxury fashion to stuffed-crust pizza.
Step three: optimise chatbots and virtual assistants
As everyday interactions become increasingly digitalised, more and more companies will use virtual assistants and chatbots for customer service. These are likely to be built with plenty of personality: a key ingredient to customer engagement.
However, the media has often over-hyped AI’s role in these technologies! It’s important to remember, good chatbots can (and do) operate without AI.
AI can instead predict the next best action for a company, through the gathering of data mentioned in Step One. Let’s take SPIXII as an example. Someone might start talking to the SPIXII chatbot without knowing much about insurance. SPIXII’s aim is that they’ll leave knowing which product will provide them with the right coverage, according to their specific needs, concerns and budget.
While AI can optimise the process of moving a customer from A to B, it will not happen overnight. It takes a firm groundwork of planning, data acquisition, algorithms and customer education.
Ultimately, 2017 will be the year we see customer engagement revolutionise, and get more personal than ever.
However – as with any movement – these advances in AI technology are not without their challenges. It’s essential that businesses use AI to improve customer engagement without infringing on their privacy. Currently, that privacy may seem a digital luxury. Yet, protecting it has never been more vital.
This article was first published on InsurTech Rising (FinTech Futures’ sister company)