How Chatbots Improve Customer Service - Definite Guide for 2022

Post by
Indrek Vainu
April 19, 2021
How Chatbots Improve Customer Service - Definite Guide for 2022

1. Introduction

Improvements in customer service are necessary because people are messaging more and more. Quick back-and-forth communications among friends in social messaging apps (e.g. WhatsApp, Messenger) translates to customers’ increased expectations in how they want to communicate with companies and brands. Users expect 24/7 feedback from brands in less than 1 minute response times. 

What this means for companies is that live agents are not capable of answering every customer’s need in person. Companies with hundreds of thousands and millions of customers find it difficult to provide 24/7 support in-person. 

As such Artificial Intelligence (namely Conversational AI) offers a way to help. Automated chatbots increase customer service efficiency by providing automated answers day-and-night for people across the globe. This means that people do not have to talk to agents anymore and they can be served automatically by Intelligent Virtual Assistants.

2. The Challenge

Many companies still struggle to make the most of AI. Mostly because AI in the domain of customer service is a relatively new concept that companies have experienced in practice. And the question for many companies is the same - “How can chatbots improve customer experience?”.

Many companies are also unaware that customers' feedback is the key to improving service. Listening to customers is a key attribute in building more optimized customer support. However, the difficulty is in analyzing the large amounts of messaging data that customers provide and understanding what needs to be improved. 

3. Chatbots - The Solution

For those companies that want live agents or interactive services but are unable to do so (because of time or budget restraints), chatbots offer the solution. There are several AI customer service software companies that customers can choose from and the price of chatbot solutions varies depending on the needs.

A chatbot is an interface through which the user can obtain information from the machine. The interface is usually in written form (chat) and in many cases the chatbot presents the user information with simple Yes/No type of options. These if-else statements are essentially decision trees where the user selects a certain answer. Upon the selection of that answer the user is given a follow-up question with a choice of answers again. 

An improvement upon a chatbot is what's called a Virtual Customer Assistant (VCA). These intelligent agents are not only capable of presenting a multiple choice selection of answers to the user but also understand user intent from free text. Understanding natural language is a significant leap. Many times users are looking to articulate their specific concern to the machine in a similar manner they would do to a human. User has a question and asks that specific question from the machine e.g. “When will I receive my payment from Bank ABC?”. The main drive behind this is that users are looking for a quickest way to get an answer to their specific question.

4. Chatbots And Customer Service

So how are chatbots changing customer service? They are making it more efficient and changing it from a cost-center into a revenue-center. 

Customer service is perfect for AI because there are large numbers of users that are looking for answers to similar types of problems. Users are looking for companies to take ownership of their products and services they offer. This repeatability of similar queries makes customer service one of the perfect fits for chatbots and virtual customer assistants.

In addition some chatbots are capable of providing personalized support. Meaning that the bots can authenticate a user and then serve them personalized information based on their past purchase history and profile. Such bots are connected to the backend of the company and through APIs pull in data from the CRM about the customers. For example in the case of a telecom company, they might recommend the customer to switch to a new mobile plan that gives more data at a discounted price. 

5. Chatbots And Customer Experience

The productivity of online customer service agents is going to improve significantly with AI. These agents will not be able to handle every query that comes their way as fast as they do now because of the rise in messaging. This is where chatbots will come in. 

These AI bots will serve as the first line of response in user interfaces. Live agents will remain available for those customers that require help from human support. The chatbot solution ensures that there is a limit to the number of customers that an agent can handle at any given time. This means that live agents are not overworked and they can devote their time to more important issues and troubleshooting complex cases. 

Currently Conversational AI based chatbots are used by larger companies (such as banks and telecoms) but the no-code software trends is also making previously complex-to-build messaging automation with AI easier. In addition, many companies are using chat automation tools for collecting leads and conducting sales. 

Chatbots improve customer experience by providing a simple and quick interface into making queries -  whether it be for frequently asked questions or specific sales related item. With the development of this technology and the increasing availability of APIs, chatbots will be an integral part of our everyday life in the coming years. 

Already today advanced AI based chatbots provide 50-60% deflection rates in customer support

This translates into cost savings for companies. And well trained chatbots can increase customer satisfaction as well, provided they are well built and trained

6. Conclusion

Chatbots enhance customer experience by allowing people to interact with applications in new ways. AI chatbots are virtual assistants that can do some of the things that people expect a person to do. And through this they improve customer experience. 

If you are looking for AI chatbots for your customer service, then feel free to sign-up for an account with In just 5 minutes you can get your own natural language understanding AI chatbot that you can connect with your website. No credit card needed for sign up and a full 10-day free trial.