Massive but real.

Did you know?

You can actually increase your revenue by a whopping 80% by focusing on customer experience.

80 is not a small number; it is large, especially for emerging startups. But what we say, you can go beyond that.

Yes, it’s possible, but you need to understand your customers better.

People like a better customer experience than discounts and deals.

You need to understand them from different angles – psychological, social view, financial and more.

That’s a hell lot of data, right?

How do you convert that huge chunk of data into actionable insights?

The answer is Artificial intelligence or AI.

AI is not yet widely implemented to improve CX. But biggies like Amazon, Spotify and Starbucks have leveraged the power of AI to transform their customer experience and have seen overwhelming results.

Want to embrace AI to drastically improve your customer experience?

We share some actionable strategies to do it right.

Let’s dive right in.  

Key takeaways

  • Customer experience includes everything from signing up for a service to taking a desired action.
  • AI is the next game changer in CX
  • Personalisation reaches next level with AI in customer experience
  • You can enhance your CX and transform marketing with AI

Why is customer experience so important?

Customer is the king of your business. What happens if you have a good product, but no one buys it?

Your business will hit rock bottom.

I bet you don’t want that to happen.  

But improving your CX to impact your business is not rocket science.

Here’s the deal:

You treat customers better, and customers treat your business better.

Microsoft survey shows that 96% of customers say better customer experience is the main reason for loyalty to a specific brand.

Customer experience starts from signing up or subscribing to shopping to logging out or placing that order.

How is AI for customer experience connected?

63% of consumers state that, they will leave brands with poor personaliaation.

AI in customer experience is the practice of using artificial intelligence technology to understand customer behaviour and provide an enhanced experience in every touch point of your customer journey.

Artificial intelligence merges well with machine learning, deep learning and the Internet of Things to provide more analysed and personalised data for a massive number of customers.

Within 2023, 40% of the customer interactions are expected to be done through automated AI and ML.

Also, $641 billion is invested by companies in Customer experience technologies in 2022.

An example of using AI in customer experience

Sarah, a working professional in California, used to order nourishing hair shampoo from a website. The website provides a personalised shampoo experience for its customers.

One day, when she woke up and checked her phone. She had a message in her inbox – Time to refill, hair day is real important!

When she takes a bath, she notices the shampoo is about to be over and needs a refill. Then clicks a link which leads to her favourite shampoo’s product page and makes a purchase.

That’s how AI makes CX work for you. It takes care of everything happening behind the scenes – from data analysis to recording behavioural patterns to generate personalised recommendations.

Different ways of using AI in customer experience

When one technology comes in, you’ve many possibilities of leveraging its potential.

Even though AI and ML can make decisions, they are not here to replace humans, but maximise the customer experience to grow your business.

AI for customer experience primarily focuses on extreme customisation and rapid responses. Let’s see how AI in customer experience will change businesses in the long run.

different ways of using AI in customer experience

Personalisation for every individual customer

Customers shops what they need, not what you offer. So showing them what they need itself attracts more customers and sales than any other strategies.

But how you can see in your customer’s mind and also for a million customers. Let’s look at the example.

Ever searched Bluetooth speakers on Google? Then you willl also start seeing many bluetooth speaker ads wherever you browse. You can see similar ads popping up on your social media.

AI looks for many parameters and understands your customer’s needs and places ads strategically to boost your conversion rate.

When you implement AI for customer experience, it learns what the customer is looking for and provides it in their hand. Amazon uses the “Customer also bought” section to improve its sales by providing what the customer needs.

You can increase the chance of making sales by providing a personalised experience based on the location, trend and what other customers opt for. Even Amazon uses AI to change prices for a better customer experience.

You can also analyse specified patterns to understand why certain customers leave your website without placing an order.

AI also makes this work in streaming services. For example, Spotify provides a playlist at the end of the year with the most played songs by you in the year. This is precisely a customer’s need.

More Targeted Marketing

Marketing is not just ads nowadays. You have different channels to target and various types of customers to acquire.

You can use WhatsApp, Facebook, Instagram, Youtube, emails and more to reach your customers. Making the messages more personalised for every individual is not a simple task.

AI writes for you and can add names to all the emails you are sending. You can categorise customers based on their psychological factors and write messages for a specific group of customers.

AI in customer experience will let you understand your customers’ behavioural and psychological understanding.

Interesting read for you – Challenges in AI marketing.

Above-the-line customer service

80% of American customers state that speed, convenience, knowledgeable help, and friendly service play a perfect role in a positive customer experience.

Customer service is really important, but time is precious too. Many people don’t like to spend much time returning a product.

AI in customer experience has a helping hand in the name of AI chatbots to achieve that positive customer experience.

Let’s talk about the factors:

  • Speed – Chatbots are available 24*7
  • Convenience – You can just text
  • Knowledge – Know how the customer behaves

You can rely on chatbots to provide service for that binge shopping at midnight.

Also, chatbots can analyse and categorise the issue on psychological terms – Angry, good, cool.

Many people like to talk to customer service executives when they feel chatbot can’t resolve their issue. When that happens, it will automatically divert it to a call to customer service.

Chatbots can make a summary for the customer service executives about what issue they are going to face by chatting with the customers. It will also prioritise the tasks or complaints that need immediate attention and allocate the tasks to the customer service.

So that the executive can be ready with the details beforehand and will understand the customers’ mood to address the issues well.

Discover the root causes

Companies can understand the root cause of many different problems. When you need to resolve an issue, you need to understand it better.

AI for customer experience will determine why your customers are not feeling good about the brand from different channels like social media platforms, chatbots, messages and customer service feedback.

When the data is analysed, you may find where the actual problem exists and how to get rid of it.

Customer engagement at its peak

When you are a service-based company, when a business opts for your service, guiding them from scratch is made easy with AI.

When someone signs up, AI can predict where they feel confused and guide them on what to do next r directing them to a tutorial video.

Every step of the customer journey will be guided till the end by AI. When there is guidance, the experience will be better.

Prevent issues earlier

AI is used to predict the issues earlier by analysing data. When there is a delay in delivering food or package, it can easily detect the problem and send a mail regarding the expected delivery time.

This ends a lot of issues between the customer and the company. AI can predict even before the pack really gets delayed because it will work on the cause; for example, if there will be rainy weather, it can predict delays due to severe weather conditions.

More than text – Voice and visual understanding

AI for customer service goes beyond limits when paired with virtual reality (VR). With this, they can easily predict the customer’s reaction with their voice and facial expressions.

AI can understand the expression; if the customer is angry or in a rush, which will help tackle almost every problem of the customer.

7 Steps to execute AI for customer experience

Before implementing AI for customer experience, ensure you have a better understanding of the AI tools and techniques. Steps to implement AI in customer experience.

  1. Create a customer journey
  2. Analyse the customer behaviour
  3. Find out the basic issues customer encounters
  4. Understand the AI solutions
  5. Decide which suits you
  6. Discuss whether to create/buy
  7. Analyse, implement and succeed

Suggested read: Mobile App or Website: Which is Better For Your Startup?

Industries which will have a high impact by using AI in customer experience.

Here is a list of industries that are massively impacted by AI-driven customer experience.

  • E-commerce
  • Video streaming
  • Audio streaming
  • Social media websites or apps
  • Healthcare
  • Finance
  • Marketing agencies
  • Advertisement


Many companies compete over customer experience. AI will be the catalyst to improve customer experience to retain customers with ease.

No matter what kind of business you do, from small to large businesses, everyone can provide a better customer experience with Artificial Intelligence.

Still looking for a way to figure out how to incorporate AI into customer experience for your business? You can rope in  AI software solution companies to design an AI-powered customer experience.

Looking to build an AI-based solution for your business? Book a free consultation with NeoITO’s AI team today.

Bonus FAQs

1. What are some personalised customer experience examples?

Improved customer experience with tailored message, personalised feed or ads, showing unique offers to every individual customer are some examples.

2. What is customer artificial intelligence?

Assisting customers with artificial intelligence technology to provide 24*7 support and enhanced service is referred to as artificial intelligence in customer experience.

3. How can AI change customer interactions?

AI works 24*7 and it can understand the psychological factors to provide the customers with better experience.

4. How does AI improve customer service?

AI helps understand big data and analyse numerous key metrics to provide a tailored, personalised experience. Incorporating a lot of data into decision-making and helping customers throughout the journey for a hassle-free experience.

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