Customer Service

The need for empathy in CX: Why chatbots can't cut it

Retailers are seeing the value in prioritizing empathetic, human-led strategies that can provide comfort, and the innate human skills that a transactional AI chatbot simply lacks.

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April 7, 2022 by Roger Beadle — CEO, Limitless

If the disruption over the last two years has taught us anything, it is that customers crave human connections and empathy, particularly during busy periods, or for urgent matters. This is backed up by an Accenture report, which found 58% more customers prefer to solve urgent issues by calling for support rather than using other channels. It also cites the fact that having compassionate customer service can have a positive effect on brand perception and customer loyalty.

The battle between chatbots and humans

AI-powered chatbots were first seen as a solution to some customer service challenges, such as speeding up resolution times, reducing wait time, improving self-service, and driving cost optimization. However, businesses are beginning to reconsider their automation strategies following shifts in consumer demands.

Focus on empathy and human connection were two keywords that were often mentioned in our recent research, which features interviews from 15 global customer experience leaders from the likes of Microsoft, Genesys, eBay, Infosys, Deloitte, Boston Consulting Group and Sage.

Businesses are now seeing the value in prioritising empathetic, human-led strategies that can provide comfort, and the innate human skills that a transactional AI-chatbot simply lacks.

These strategies give brands an opportunity to not only enhance the consumer lifecycle, but also differentiate themselves from companies that aren't getting this part of the customer experience right. With so many similar products on the market, this is now crucial if you want to keep new (and long-standing) shoppers.

Customers talking to customers

Consumers are more likely to buy from brands that have customer-led service, where they can communicate with people who actually use the products rather than chatbots or contact centre agents. In fact, our survey reported 70% of consumers would trust customer service agents more if they were fellow customers themselves.

This model is well suited for several industries, including consumer electronics, which can be complex and have varied usage among consumers. It is hard for a customer contact center employee to be trained on all these variances, and on the flip side, big electronic brands usually have lots of advocates and people who like the brand.

As they already have a deep product knowledge of the brands they serve, the customer advocate approach means companies can go way beyond transactional interactions. Not only that, but they are also more trusted and can assist throughout the customer journey. Consumers have voiced the importance of receiving empathetic, genuine responses and best practice knowledge on using the product or service, so getting this part of the customer journey right is essential.

When you consider that context and understanding are key for genuine and useful exchanges, it's no wonder automation can sometimes come at the mercy of customer satisfaction. According to Forbes, chatbots can lead to an 80% decline in satisfied customers. That's why brands will need to evolve and tune into what consumers are really looking for by putting great communication and empathy at the heart of their CX strategies.

New KPIs

Incorporating more empathy into the customer experience may mean re-evaluating customer service KPIs. For example, if agents need to spend more time with customers to establish personal connections, provide the right information, and solve the case, average handling time will surely go up and it may take longer to close tickets. Letting go of old success metrics requires a strong commitment to a new path and new ways of measuring.

Measuring on a KPI that focuses on the value of a long-term relationship between company and customer can align resources and change processes and behavior across the company. This is where customer lifetime value will come to the forefront, as it puts the customer at the center of customer experience and creates an opportunity for brands to redesign their operations. Determining customer lifetime value is all about estimating an entire future relationship with a customer — 'relationship' being the key word.

A shift in consumer behavior

We saw how the pandemic started a shift in the customer service industry that showed a preference for human connections compared to chatbots or online self-service options.

A Daily Mail report noted a change in consumer behavior as one of the motives for the boom of call centers during lockdown: More people taking up DIY projects and looking for advice, more people doing late night shopping, and more people working from home or on furlough, having more time to contact contact centres.

Add to that the desire for connectedness that many of us have been looking for during isolation.

Customer success

Focusing on the idea of customer success will be key, and something that automation alone will struggle to achieve.

No doubt, a shift in consumer behavior has led many companies to source their most knowledgeable and experienced customers and brand advocates (otherwise known as GigCX experts) to help other customers get more value from their products or services at every point in the customer journey. In a recent survey, Limitless found 72% of customer service managers have added or plan to add gig talent to customer service or sales operations within the next two years.

If you are coaching someone on how to do something or helping them get set up, for example, it is best done by a human who can provide authentic responses. Of course, you can use automation for the simple tasks, but brands need to humanise the conversations that are most valuable.

These human interactions are much more likely to keep a customer longer, extend their lifetime value, and increase their spending over time.

What lies ahead?

So, as we enter the post-pandemic era, what can we expect from customer service? Are we going to see a rise of chatbots again, or will businesses continue to focus on the human touch of customer service?

It is clear from the research mentioned that while AI can play a key role in customer experience, consumers prefer personal, human interactions, and relying on chatbots alone won't work.

Roger Beadle is CEO at Limitless

About Roger Beadle

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