Feature
The Gist
- AI empowerment. Brands use AI to automate tasks, enhance insights and provide personalized service.
- Data-driven insights. Predictive analytics in AI helps brands understand and anticipate customer needs.
- Streamlined operations. AI automates routine tasks, enabling employees to focus on strategic activities.
Artificial intelligence (AI) is revolutionizing customer interactions, offering businesses unprecedented opportunities to enhance customer experience (CX). By integrating AI, brands like Target, with its Store Companion, empower employees to automate routine tasks, gain deep insights into customer preferences, and deliver more personalized, efficient service.
This blend of AI and human expertise enables faster, more accurate service, attuned to individual customer needs. Consequently, employees are better equipped to craft experiences that build lasting customer satisfaction and loyalty.
This article explores AI's transformative role in CX through employee enablement, showcasing how technology and human creativity are shaping the future of the customer experience.
Target Recognizes AI’s Potential for Enhancing EX and CX
AI is already impacting the way businesses operate, profoundly enhancing how they interact with customers and streamlining operations. Companies are improving efficiency and elevating the overall customer experience by empowering employees with AI-driven tools.
A prime example of this trend is Target's recent deployment of an AI tool called "Store Companion," which is designed to assist store employees in managing daily tasks more effectively and enhancing customer service by “answering on-the-job process questions, coaching new team members, supporting store operations management and more.” This tool streamlines team operations, enabling quicker and more efficient service, enhancing guest engagement, and improving the shopping experience. It's a key component of Target's strategic use of generative AI to empower employees, elevate customer interactions and drive sustainable growth.
In the announcement, Brett Craig, executive vice president and chief information officer at Target, said, "We know technology will continue to play an outsized role in the future of retail — for our team members, our guests and our business. With that in mind, we're continually experimenting with new tools to make it even easier for our team to do their jobs and to bring more of what guests love about shopping at Target to life."
Mark Schindele, Target’s executive vice president and chief stores officer, stated that generative AI is a game-changing technology, and Store Companion will make daily tasks easier and enable Target's team to respond to guests' requests with confidence and efficiency. "The tool frees up time and attention for our team to serve guests with care and to create a shopping destination that invites discovery, ease, and moments of everyday joy," he said.
Target isn't the only retailer leveraging generative AI. Walmart adopted the technology late last year to enhance mission-based customer searches and equip frontline employees with real-time information, improving their ability to serve customers effectively. In recent years, the connection between an organization’s employee experience (EX) and its CX has become increasingly evident.
With evolving labor force dynamics and advancements in technology that connect companies, employees and customers, many leaders now view EX as a key driver of CX. This recognition has led to a strategic focus on integrating EX and CX initiatives, leveraging smarter approaches to simultaneously enhance both.
Related Article: Subscription Models: CX Lessons From Target's Circle 360 Program
The Role of AI in Understanding Customer Needs
AI has become instrumental in decoding the complexities of customer behavior and preferences through sophisticated data analysis, predictive analytics and sentiment analysis. This capability not only enhances how businesses understand their customers but also enhances the way they meet customer needs proactively.
AI excels in its ability to sift through vast quantities of data to extract meaningful insights, a task unfeasible at such scale and speed for human analysts. By applying machine learning (ML) algorithms and data mining techniques, AI systems can identify patterns and trends that escape the naked eye. For instance, AI can analyze purchase histories, browsing behaviors and social media interactions to offer a granular view of customer preferences and satisfaction levels.
Pablo Sánchez, global CMO and ESG director at business transformation outsourcing provider Atento, told CMSWire that AI is revolutionizing customer interactions by enabling businesses to deliver personalized experiences for each inquiry.
"For instance, advanced AI and analytics tools can analyze voice and text interactions across various communication channels, allowing companies to predict consumer expectations and demands, thereby offering a unique experience for each user,” said Sánchez. “This personalization translates into improved customer satisfaction, increased loyalty and a deeper relationship with the brand."
Beyond just understanding current trends, AI leverages predictive analytics to forecast customer behaviors and needs. By analyzing past interactions and behaviors, AI models can predict what customers might need next, sometimes even before the customers themselves are aware of the need. This aspect of AI enables businesses to provide proactive service, such as recommending products, anticipating customer issues before they become problematic, or automating replenishment of goods based on predicted demand.
For example, an AI system could alert a customer service representative to reach out to a customer who is likely to need support, or it could suggest additional products to a customer online based on their buying patterns and predicted needs. This proactive approach not only enhances the customer experience by making it smoother and more personalized but also helps in building a stronger, more trusting relationship between the customer and the brand.
“AI tools are providing significant support to agents, leading to more effective interactions and conversations,” said Sánchez. “This technology provides them with real-time information, analytics and recommendations to deliver a unified and consistent customer experience. The combination of virtual and human agents allows for more accurate, efficient and personalized experiences, integrating multiple communication channels, even automatically sending protocols and updated process information to consumers.”
Sánchez suggested that ultimately, a better EX translates into a better CX, creating a virtuous cycle of continuous improvement and satisfaction for both customers and employees.
Related Article: How AI Integration Can Power Better Human Experiences
Streamlining Operations and Improving Efficiency
AI is increasingly crucial in streamlining operations and enhancing efficiency within organizations, especially in contexts that directly affect customer experience. In customer service, AI is capable of automating routine tasks and optimizing resource allocation, improving operational workflows and enhancing the ability of employees to focus on more strategic and complex activities.
Joe Alim, VP of product and operations at employee benefits software company Compt, told CMSWire that AI has had a transformative impact on both the employee and customer experience. "Since integrating AI into our operations, we’ve streamlined many routine tasks. I've seen firsthand how it empowers my teams (customer success, product and engineering) to focus on more strategic and creative aspects of their roles,” said Alim.
AI excels in automating routine, repetitive tasks that traditionally consume a significant portion of employees' time. This includes processes such as data entry, scheduling, inventory management and basic customer query handling through chatbots. For example, AI-powered chatbots can handle a large volume of routine customer inquiries such as tracking order status or answering FAQs, allowing human agents to focus on more complex and sensitive customer issues that require human empathy and judgment.
In retail environments, AI can automate stock level monitoring and reorder processes, ensuring that products are always available for customers without manual stock checks. By removing the burden of these mundane tasks, employees can dedicate more time and energy to improving customer service and tackling challenges that require deeper insight and personal touch.
Craig Crisler, CEO at SupportNinja, a customer experience and back-office support services provider, told CMSWire that integrating AI can help CX departments deal with increasing pressure to deliver exceptional service quickly and efficiently.
“AI can enhance the customer experience seamlessly integrating with human support teams," he said, "providing always-on assistance while advanced sentiment analysis allows CX agents to better understand customer needs and tailor interactions accordingly.”
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AI also plays a pivotal role in optimizing resource allocation, ensuring that the right employees are in the right place at the right time, and equipped to handle the tasks for which they are best suited. Through predictive analytics, AI can forecast peak periods of customer activity, enabling businesses to allocate additional resources proactively. Additionally, AI can analyze employee performance data to match service agent strengths with specific customer service inquiries.
By leveraging AI to automate routine tasks and optimize resource allocation, businesses can significantly enhance operational efficiency and focus more on strategic initiatives that enhance customer satisfaction. This not only drives productivity but also empowers employees to contribute more effectively to business goals and customer needs, establishing a more agile and responsive business environment.
AI Is Being Used for CX Improvement Across Industries
Target’s Store Companion was designed to enhance its retail operations and customer service. Store Companion enables employees to quickly locate products within the store, check inventory in real-time and access product information and promotions, which they can then relay to customers to improve their shopping experience. This AI implementation demonstrates how technology can bridge the gap between digital convenience and in-store service, enhancing both efficiency and customer satisfaction.
While the introduction of Store Companion is likely to bring significant benefits, it also presented challenges that Target had to address. One major challenge was integrating this new technology seamlessly with existing systems and workflows without disrupting daily operations. Employees needed training to adapt to the new tool, ensuring they could use its features effectively without diminishing the quality of personal customer interactions. In addition, as with the majority of AI applications, there was a need to balance the use of AI with human judgment, especially in handling complex customer queries that require a personal touch and deep product knowledge.
Another example of the use of AI for CX is Bank of America's AI-powered virtual assistant, Erica, which helps customers conduct transactions, locate financial information, and manage their banking activities via voice and text commands. For employees, Erica offloads routine tasks like account balance inquiries and transaction history requests by handling them directly with customers. This allows human agents to focus on handling more complex customer issues that require human intervention.
Like Store Companion, the initial rollout of Erica required significant training for both employees and customers to effectively interact with Erica. There was a learning curve associated with trusting an AI tool for personal banking needs, and employees had to learn how to intervene when customers had issues beyond Erica’s capabilities.
In the healthcare industry, Cleveland Clinic effectively used AI to enhance patient care by analyzing vast amounts of data from electronic health records to predict patient risks and outcomes. This tool assists healthcare providers in making faster, more informed decisions regarding patient care plans. AI algorithms help flag at-risk patients before severe symptoms occur, allowing for preemptive treatment planning and better resource allocation.
Despite the benefits, the reliance on AI in healthcare raises concerns about privacy and the accuracy of AI predictions. Ensuring that the AI systems are continuously updated with accurate data and that employees understand the limitations of AI predictions remains a significant challenge.
These case studies demonstrate that while AI can significantly enhance customer experience and employee efficiency, careful implementation, continuous training, and an understanding of AI's limitations are crucial to maximizing its benefits. The integration of AI should complement, not replace, the human elements of customer service, ensuring that technology serves to enhance human capabilities and customer satisfaction.
Challenges and Considerations
As businesses continue to integrate AI into their customer experience strategies, several challenges and considerations must be addressed to ensure successful implementation and sustainable use. These include integration issues, training needs and ethical considerations.
One of the primary challenges in implementing AI is the integration of new technologies into existing business systems and workflows. Often, legacy systems are not designed to interface seamlessly with the latest AI technologies, which can lead to data silos and disrupted workflows. Effective integration requires a robust IT infrastructure and a strategic approach to system redesign, where compatibility and scalability are key considerations. Additionally, AI systems must be constantly updated and maintained to cope with evolving customer needs and technological advancements, requiring ongoing investment and attention.
For AI tools to be effective, employees must be proficient in using them. This often requires comprehensive training programs that not only teach the technical skills needed to operate AI systems but also create an understanding of how AI can enhance their roles and the overall customer experience.
“One of the key challenges you'll find in introducing any new software, let alone AI, is ensuring that your team feels comfortable and confident with the new tools,” said Alim. “There can be a learning curve, and some initial resistance, especially if people worry about the implications for their jobs and workflows.” In addition, training should be iterative to accommodate updates in AI technology and to refine the skills that employees need as they grow more accustomed to working alongside AI.
Employees should be reassured that AI is not coming for their jobs, as it’s the combination of AI and the human touch that provides the most benefits.
"The fear is that AI will take over but the conventional way of doing things is not as efficient as it should be,” said Crisler, who like many of the experts we spoke with, reiterated the importance of the human connection. “The AI boom will help significantly, but it can’t do it alone — it also needs human help. It's time to reframe the narrative. AI isn't the enemy — it's a powerful tool that, in the right hands, can transform the way we do business and serve customers.” Crisler emphasized that the endgame isn't a world with no human involvement — it's a future where AI and people work in harmony to elevate the customer experience.
The use of AI in customer interactions brings several ethical considerations to the forefront. Privacy and data security are major concerns, as AI systems often process vast amounts of personal information to personalize customer interactions. Ensuring that this data is handled securely and in compliance with privacy laws is crucial.
Additionally, there is the risk of bias in AI algorithms, which can lead to unfair treatment of certain customer groups. Businesses must strive to implement AI solutions that are transparent and accountable, with regular audits to check for and correct biases.
Final Thoughts
Incorporating AI into customer experience strategies significantly enhances employee capabilities, streamlines operations and improves decision-making processes. Target’s use of AI with its Store Companion and Walmart’s implementation of AI for mission-based searches and real-time employee support are prime examples of how brands are equipping employees with AI-driven tools for data analysis, personalization and decision-making, leading to more efficient, responsive, and tailored services, a better employee experience, and, in the end, an exceptional customer experience.
