Generative AI (GenAI) adoption within enterprise organizations is surging. A 2024 McKinsey global survey found that usage jumped from 33% in 2023 to 65% in 2024, and Gartner now predicts that by 2026, over 100 million people will engage “robocolleagues” to assist with their work. And what will those AI assistants be doing? Many of them will be deployed with a clear purpose: to improve the customer experience.
McKinsey identified 63 GenAI use cases spanning 16 business functions across industries and determined that in total, they could deliver $2.6 trillion to $4.4 trillion in economic benefits per year. Examples include using AI to streamline supply chain management, using AI for legal risk assessment, and using AI for talent recruitment, but these examples rank on the low end when it comes to business impact. The vast majority of GenAI’s value is predicted to come from introducing the technology to four business functions: customer operations, marketing and sales, software engineering, and research and development, with the biggest impact as a percentage of functional spend coming from customer operations. In fact, McKinsey estimates that applying GenAI to customer care functions could increase productivity at a value ranging from 30 to 45% of current function costs.
Customer experience (CX) leaders have taken note of the potential benefits of using GenAI, as well as its risks, which include the potential for bias and inaccuracies in the content it generates. Many are testing the GenAI waters while keeping an eye on the regulatory environment, which may place limits on how AI can be used in the coming years.
Here, we examine four ways customer-centric brands are leveraging GenAI today to improve the customer experience.
AI can speed up and improve data processing
Traditional AI has been used in customer journey mapping for years to evaluate large data sets, locate patterns, and make data-based predictions. The game-changing aspect of GenAI is that it can deliver this type of analysis conversationally.
Instead of requiring data analysts and a substantial time investment to crunch the numbers, anyone—regardless of technical ability—can now ask questions in natural language and receive everything from insights to charts. Conversational reporting has the ability to shorten the time from data gathering to analysis to action. This technology also has the potential to make customer journey mapping more accessible to small and medium-sized businesses.
AI can increase the efficiency of customer service teams
The public release of OpenAI’s ChatGPT in November 2022 was met with some concern about job loss due to GenAI, but a recent survey of business executives indicates that the majority don’t expect to significantly decrease customer service team headcounts because of AI. Rather than replace human agents with AI, organizations are deploying AI in a way that enables and empowers CX teams.
By implementing AI chatbots to handle simple requests, using GenAI for first drafts of customer communications, and utilizing conversational AI to amplify internal knowledge bases, customer service can be streamlined in a way that improves the experience for both customers and employees. McKinsey cites one case study that yielded impressive results:
“Research found that at one company with 5,000 customer service agents, the application of generative AI increased issue resolution by 14 percent an hour and reduced the time spent handling an issue by 9 percent. It also reduced agent attrition and requests to speak to a manager by 25 percent.”
The natural language processing ability of the latest AI tech is capable of what Forrester calls “real-time emotional intensity analysis,” which can help automate escalation and lead to quicker resolutions. This can in turn help to increase overall satisfaction (OSAT) scores.
AI can deliver more personalized customer experiences
GenAI promises hyper-personalization of the customer experience, but what exactly does that look like in practice? Here are few ideas based on what leading service organizations have implemented:
- 24/7 conversational support in any language
- Product or service recommendations and offers based on past purchases
- Assistance within signup and checkout flows
- Upsell and cross-sell assistance throughout the customer journey
These AI capabilities don’t just help to improve the customer experience; they can also contribute to the bottom line, especially in e-commerce contexts. For example, AI-generated content and messaging within cart and check-out flows have been found to reduce cart abandonment and increase revenue by 3 to 5%.
AI can help foster brand loyalty
Converting new customers is not the only way GenAI can help; engaging existing customers is also an avenue for leveraging AI for a better customer experience. Customer-centric brands are using AI to not only tailor loyalty programs and rewards to individual behaviors and preferences but also to offer those rewards conversationally.
AI isn’t going anywhere
GenAI is here to stay, and research shows that enterprises with greater levels of AI maturity will gain greater benefits to their revenue. There are still, however, questions to be answered and risks to be mitigated. SMG is the partner to help you adopt a strategic use of AI and other technologies to enhance the customer experience.
Download our white paper How generative AI is revolutionizing customer experience management for guidance on using AI effectively—without losing the human touch.
