AI bots could soon become your new customer service agent

If you thought getting through an automated voice system was annoying, you could soon try getting through an AI bot.
Written by Maria Diaz, Staff Writer
AI chat support
Francesco Carta fotografo/Getty Images

Artificial intelligence is often seen as a sort of "big bad wolf" of technology, largely because of its potential to disrupt humanity as we know it. One of the biggest theories that trigger apocalyptic fears is the idea that AI will steal the jobs currently performed by humans, triggering mass layoffs and a shift in the economy. That theory isn't too far-fetched.

About 28% of the current jobs can be automated by AI, and companies like IBM have already begun replacing part of their workforce with AI-powered tools. AI can easily perform many jobs in human resources, though not all, and it can also be a helpful tool to automate many mundane tasks, but businesses are also using it for customer service. 

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According to a report by Gartner, worldwide spending on conversational AI technology in customer service centers for 2023 is projected to increase by 16.2% from 2022, totaling $18.6 billion. The investment is evident in the projected growth of conversational AI in customer contact centers by 366% by 2027.

"Longer-term, generative AI and growing maturity of conversational AI will accelerate contact center platform replacement as customer experience (CX) leaders look to simultaneously improve the efficiency of customer service operations and the overall customer experience," according to Megan Marek Fernandez, director analyst at Gartner.

Conversational AI includes chatbots like ChatGPT and virtual assistants like Siri and Alexa. It's a technology that uses machine learning and natural language processing to understand text and speech input and respond accordingly. 

Companies are already turning to conversational AI to improve their customer service experience. Zoom announced earlier this year that it would add Anthropic's AI chatbot, Claude, to improve customer interactions. Quiq is a company that specializes in adding conversational AI to customer experience departments across retail and hospitality brands, used by companies like Brink's and Lane Bryant. 

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"Companies are beginning to understand how much more powerful the latest AI is and how it can improve their CX departments. They are turning their attention to the implementation of an AI-based customer service solution in the next few years," said Mike Myer, CEO of Quiq. 

Gartner, the research company behind the report, says that the conversational AI market is the fastest-growing segment in the customer service or contact center forecast, driving 24% growth in 2024. 

"This means that while many IT investment areas will be weakened as budgets tighten, customer service and support initiatives that have the potential to differentiate the customer experience or streamline customer service operations could receive easier investment 'buy-in," explained Marek Fernandez. "These factors will help contact center as a service (CCaaS) projects receive funding associated with broader corporate digital transformation budgets."

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Of course, the current economic uncertainty certainly drives at least some choices to shift strategies to AI over humans. Conversational AI like chatbots can be far cheaper than hiring people, after all. 

"Companies are simply looking for ways to do more with less. This has accelerated the interest in AI solutions faster than expected. The timing of the market conditions in combination with the revolution of AI technology has gotten the attention of brands across the board," added Myer. 

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