The emergence of generative AI is transforming the way businesses operate, ushering in a new era for productivity and efficiency. This year, one of the most impactful shifts taking place is how the technology is changing the way businesses can connect with and serve their customers.
While AI and automation in customer experience is not particularly novel, having existed for years, what is novel is the dramatic improvements of these applications through generative AI. As the AI sector continues to mature, it holds enormous potential for transforming the realms of customer experience and marketing, providing companies with a competitive edge in the digital era and customers with an increasingly seamless experience.
By harnessing the power of large language models (LLMs), companies are discovering how AI can provide them with a deeper understanding of their customers and help them deliver personalized experiences that enhance satisfaction and foster loyalty. Whether it is through virtual assistants or hyper-personalized marketing strategies, generative AI is empowering businesses to anticipate and cater to customer needs more effectively. The positive effects will filter through to not only customers, but businesses too.
GenAI is enabling chatbots to finally live up to expectations
According to recent research from IBM, improving customer experience is a powerful incentive for businesses looking to deploy AI, with 43% of business leaders in EMEA identifying it as a key AI priority within their organization.
In our fiercely competitive commercial landscape, providing customer experience and care is becoming critical for businesses. From banking to food deliveries apps, our hyper-digitized world gives customers and consumers a plethora of alternative providers at their fingertips, meaning that outstanding customer experience is vital for retention.
Generative AI, therefore, is providing companies with the tools they need to stay competitive in today’s market and provide the solutions that consumers demand. Chatbots have existed for years, but we are now seeing dramatic improvements of these applications through generative AI, creating platforms more akin to a ‘virtual customer agent’ than merely a chatbot.
Through LLMs, we are now able to garner a better understanding of intent and enrich our knowledge base, with companies having the ability to integrate policy, product data and user manuals into applications. With this wealth of data, these ‘virtual customer agents’ now have the power to craft responses based on learned patterns and data, while considering the conversation’s context and their training data to give accurate replies.
In fact, according toIBM client data experience, chatbots powered by generative AI can achieve a success rate of up to 90%, compared with the 60% average of traditional chatbots.
An effective virtual assistant application also translates freeing up more staff members who can then re-direct their time and efforts into more high-value work and focus on the customer enquires that require additional investigation.
GenAI is Transforming Marketing too..
So far, much of the conversation around AI and the customer have been focused on service, but there is a step earlier in the customer journey that generative AI is also transforming – marketing. In fact, according to IBM’s latest Institute for Business Value CEO Guide, 76% of CMOs say generative AI will change the way marketing operates and is becoming critical in remaining competitive.
There are two core ways that generative AI is changing marketing: content creation and hyper personalization.
Content Creation
Content creation has been one of the most prolific and awe-inspiring areas of generative AI, with new applications consistently pushing the boundaries of what we can create. With content creation being a cornerstone of marketing – and indeed an incredibly time consuming one – generative AI provides a key opportunity to dramatically boost productivity in the area.
It is important to note that there are ongoing debates around the regulations of AI in content creation, particularly in relationship to ownership and declaration of usage. However, companies deploying the technology in a transparent and trustworthy way can enjoy the creative benefits the technology brings.
There are also incredibly useful strategic uses of generative AI in content creation. Content transcreation, for example, is rising in popularity whereby AI models based on organizational data can localise content not only through language, but through tone and meaning for a specific culture or geography, allowing organizations to connect more effectively with customers across markets. Generative AI powered content can also be leveraged to automatically assess brand and regulatory compliance of content and images, boosting efficiency for the user and mitigating risk.
Hyper-Personalization
This enhanced ‘personalization’ is a major benefit of AI and is now being harnessed for marketing outreach and targeting.
We live in a world where data is king and in 2024, most businesses have amassed a significant amount of proprietary data about their customers and potential customers. Whilst traditional analytics have already transformed marketing tactics, LLMs are elevating these strategies further. The ability of LLMs to analyse large data sets across different business functions and departments unlocks a wealth of insights that were previously hidden.
Harnessing these insights can provide a clear, detailed view of the customer journey and behaviours, allowing marketeers to create hyper-personalised efforts for outreach and capture. For example, generative AI can support dynamic personalisation of product descriptions when users are browsing catalogues driving higher engagement and conversion, and provide specific nudge offers to the customer, boosting customer loyalty. In one example, IBM has been collaborating with a consumer retail business, using AI to help create personalized promotional offers to drive sales. This has successfully grown the business by over 30% year-on-year.
Embracing the GenAI Revolution
For business leaders looking to capitalise on these opportunities, it is critical that they re-align priorities and teams with the digital era. Unlocking these capabilities securely and at scale will require the right underlying building blocks and infrastructure. Customer Identity and Access Management, Digital Asset Management systems, Content Management Platforms, Customer Data Platforms, and CRM systems are all key pieces of the puzzle, all of which must be underpinned by a robust data governance framework that can ensure the security and accuracy of data and outcomes.
The arrival of generative AI will only further revolutionize customer experience and marketing in 2024, enabling businesses to better connect with their customers in exciting and creative ways. By embracing the technology, organizations can streamline their operations and redirect efforts to more strategic and creative outputs. This paves the way for tailored customer experiences, delivering relevant content and recommendations that enhance satisfaction and drive business growth.
Welcome to a future where AI isn’t just a tool; it’s the driving force behind businesses’ innovative ascent.
About the Author
John Sullivan is the Managing Partner for IBM iX EMEA. Within his role, John leads a team of dedicated experts who help clients adopt digital technologies and capabilities to create new experience-led digital processes, products, and services to deliver growth and productivity.
