AI customer service is such a vast topic that many small-to-medium-sized (SMB) business owners aren’t sure where to begin. By understanding the fundamentals and identifying key areas you want to enhance, you can cut through the noise and confidently choose the right tools.
In this article, you’ll learn everything you need to know to make AI a powerful and practical part of your customer service strategy.
What is AI customer service?
AI customer service means using artificial intelligence technology to support buyers before and after they purchase from you (e.g., answering questions, solving problems and improving overall experiences).
For example, AI customer service solutions can include a website chatbot that answers FAQs instantly. It could also be a system that pinpoints different emotions (i.e., customer sentiment) in feedback to help agents resolve issues more efficiently.
Intercom’s Finn is an example of an AI chatbot that learns from customer responses and improves over time.
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For small-to-medium business owners, AI in customer service helps you do more with less. It’s like having a digital assistant or co-pilot available 24/7 to help give your customers quick and accurate support when you’re focused on other business matters.
When Intercom reports that 87% of support teams have seen customer service expectations increase over the past few years, you can’t afford to be left behind. Two-thirds of teams from the same study say AI has directly influenced these expectations.
Fast and reliable customer service can set your business apart in a competitive market. AI also allows you to provide high-quality support without hiring a large team, helping you save time and money while attending to customers’ needs.
What are the data-backed benefits of customer service AI?
AI can help you create seamless experiences across all support channels, from behind-the-scenes data capture to frontline customer engagement.
Here are five main benefits of AI and customer service, backed by recent studies.
Available 24/7
AI tools, like chatbots, can provide support around the clock. For example, a customer can ask about your store’s return policy at 2 AM and get an instant response.
Fast replies keep customers happier and ensure you never miss an opportunity to help. 67% of UK respondents in CM.com’s global study expect 24/7 availability. McKinsey research also found that two-thirds of millennials want brands to offer real-time customer service.
Self-service options (like chatbots) are becoming crucial to answer customer queries. According to Tidio research, 88% of consumers expect companies to offer online self-service support.
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Instant quality support can enhance your brand reputation and attract more buyers or subscribers.
Saves time and resources
AI handles repetitive tasks automatically (e.g., answering common customer questions or updating order statuses).
For example, an AI system linked to your knowledge base can answer simple product queries and reduce the need for human intervention. AI email generators also help reps craft more personalized responses in less time.
In a poll by rental management software Hospitable, 61% said they prefer AI’s faster responses than waiting to speak with a human agent. Handing routine tasks to bots also frees your team to focus on problem-solving or more complex issues.
Scales with your business
AI can handle more customer interactions as your business grows without hiring additional staff. For example, a chatbot can communicate with multiple customers simultaneously.
It’s no wonder that Forbes Advisor research indicates customer service as the most popular use of AI in business.
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The previously mentioned Intercom study observed that teams already use AI to resolve 11–30% of their support volume.
AI technology allows you to scale your help desk without initially increasing costs or staff. With consistent service handled, you can focus on growing other business areas.
Ensures consistent responses across channels
In addition to reducing human error, AI ensures all customers get the same high-quality service.
AI delivers the same answers to customer inquiries through email, live chat or social media. For example, an email generator can provide every customer with a consistent, clear explanation of your pricing or policies.
While the human element is important, many consumers prioritize speed and accuracy. The CM.com study also suggests that 54% of global consumers prefer quick, curt assistance over a longer wait time for more empathetic responses.
Helps you understand customer behavior better
AI tools can regularly analyze customer data to identify trends, preferences and pain points.
For example, AI might pinpoint that many buyers ask about shipping times. With this knowledge, you can update your website or marketing materials to make these details more obvious and reduce customers’ need to reach out.
This analytical use of the technology is becoming more popular. Gartner predicts that by 2025, 80% of support teams will apply AI to improve customer service experiences and agent productivity.
The state of sales and marketing 2024
8 crucial AI customer support applications to understand
Before implementing AI customer service tools, you must understand how they work. This foundational knowledge will help you choose the right software for your business’s unique use cases.
Here are eight AI technologies and applications you need to know about.
Natural language processing (NLP) | The foundation of how AI understands and processes human language. Without NLP, AI-powered chatbots couldn’t understand and create text. |
AI tools use data and algorithms to improve themselves, making responses more accurate and personalized. | |
Large language models (LLMs) | Advanced AI models trained on vast amounts of text data understand and generate more natural, nuanced, human-like text. |
A type of AI that can create content (e.g., images, text or even music) to interact with customers. | |
Sentiment analysis | AI uses NLP and machine learning to determine emotions within text for more empathetic and context-aware responses. |
Predictive analytics | AI leverages historical data and machine learning to predict future customer behavior, respond proactively and personalize interactions. |
Chatbot | A type of conversational AI that uses all of the above technology to respond appropriately to customers and route queries to the right human agents. |
Omnichannel support | AI can handle inquiries across multiple channels (e.g., email, chat and social media) or contact centers to ensure a seamless customer experience (CX). |
Understanding these terms and technologies means you’ll be better informed when searching for AI solutions – and more likely to choose those that will have a positive impact.
How to implement AI customer service in your SMB
Implementing AI customer service might seem daunting, but it doesn’t have to be. With the right approach, you can use it to save time, improve efficiency and enhance CX without breaking your budget.
Here are five steps to use AI-powered customer service as an SMB owner.
1. Identify key customer pain points
Start by analyzing your current customer service process and support tickets. Where are the bottlenecks? What questions or customer issues come up most often? Answering these questions ensures that your AI solutions first address the most impactful areas.
Let’s say you’re a small software-as-a-service (SaaS) company that offers project management tools. Common customer pain points might include:
Difficulty onboarding as a new user, with a high number of support queries around setup and features
Frequent questions about integrations with other tools, such as customer relationship management (CRM) software or calendars
A backlog of tickets during peak times (e.g., end of the quarter) that delays response times
By identifying these issues, your company could prioritize AI solutions like:
Chatbots or email generators to help support agents manage workloads effectively
Predictive analytics to anticipate and respond to new issues before they become widespread
You can pinpoint areas for improvement by searching through historical customer conversations to find common issues. You can also send out surveys asking both agents and users for feedback.
2. Choose the right AI tools for your needs
Evaluate tools based on your specific requirements and start small. For example, implement AI on a single channel or for a specific task (e.g., order tracking or appointment scheduling).
Researching and testing one AI solution at a time minimizes risk and helps you assess the tool’s impact before scaling up.
For example, the small SaaS company in our previous example might consider:
A chatbot that can automate onboarding and offer instant assistance for common questions, improving CX while easing the load on support agents
Predictive analytics that unearth how users navigate the tool’s digital experience and provide insights to improve it
AI-powered knowledge base tools that store and manage company data to streamline file and data sharing
Here’s how one AI tool answers user questions by referring to a brand’s knowledge base:
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Experiment with multiple free trials to gauge a tool’s fit before committing to a subscription. This approach ensures you’ll get value from your AI solution before scaling to other channels or tasks.
3. Leverage AI in existing tools
Many tools you already use may have built-in capabilities to save you time and effort without additional software. These embedded or upgradable features can help you avoid extra costs or streamline integration.
Here are three examples:
Your AI CRM can help customer service teams save time and pinpoint more valuable insights when analyzing data
Your email marketing software may have a feature that uses AI to send the right message to the right contact at the right time
Your customer feedback platform may offer AI-powered insights that can analyze survey responses and provide actionable recommendations
Research your current tech stack and search for AI-powered features or add-ons. Opt for free trials (if available) or ask customer support if you can demo them before committing to an upgrade.
Note: We’ll cover Pipedrive’s AI customer service features in more depth later in the article.
4. Train and optimize AI over time
To get the most accurate, relevant data from your AI software, you need to train it to your specifications. Upload FAQs, customer inquiries and past support requests to help the AI understand your business’s needs.
Tailoring the AI ensures it’s both accurate and valuable. However, you must avoid inputting any sensitive or private data.
AI tools are self-learning, using all content as training data to improve the technology. In theory, another user could ask the same tool to divulge your sensitive information.
Making this mistake is more common than you think. According to Cyberhaven, 11% of data that employees paste into ChatGPT is confidential.
Once your tool is up and running, remember to test and optimize it regularly. Monitor performance, gather customer and employee feedback and tweak the system for continuous improvement.
5. Balance automation with human support
While AI agents can be helpful for routine queries and data analysis, customers must be able to escalate complex or emotional issues to human service agents.
According to Callvu’s study, consumers rate live agents higher than AI on more customer service criteria (e.g., understanding complex challenges, resolving issues first time and venting frustrations).
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Although Five9 research suggests that younger consumers view AI bots as helpful and efficient, other studies indicate that 80% of US consumers find them frustrating.
While AI assistants are fast and helpful, they can’t empathize or strategically think yet. Balancing a mix of bots and human team members can help keep operations running smoothly and ensure that your customer satisfaction (CSAT) scores remain high.
How to use Pipedrive’s AI customer service software and automation
Pipedrive’s CRM solution extends beyond sales management, offering multiple AI-powered tools and automation to enhance customer service interactions and operations.
These features help smaller businesses stay organized, respond promptly to inquiries and create personalized experiences for customers.
You can watch this video to learn about each AI feature:
For instance, Pipedrive’s AI email writer includes two valuable tools for support teams:
AI email creation helps agents craft quick, personalized emails from simple prompts (e.g., “Write an apology email for a long wait time and order delay”)
The email summarization tool creates short, actionable summaries of your email conversations to save time and pinpoint crucial information
Here’s what these email recaps can look like:
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Pipedrive’s intuitive, user-friendly interface makes it easy for small teams to get up and running quickly without the steep learning curve of more complex platforms.
You can also use Marketplace’s AI search engine to find third-party integrations that best fit your CRM automatically. Use these apps to enable seamless CRM customer service enhancements like chatbots, ticketing systems and analytics tools.
Pipedrive’s Marketplace includes two powerful time-saving tools:
AI-powered Marketplace search allows you to find apps using natural language, such as “What apps can I use to track time?” instead of exact terminology
SmartApps suggests tailored and personalized apps based on your company’s size and industry, your current apps and those similar companies use
Here’s an example of what tool recommendations can come up:
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Pipedrive’s scalability means it grows with your business, allowing you to add these features and integrations as your customer service needs evolve.
While not an AI tool, Pipedrive’s workflow automation feature is another powerful resource for streamlining customer service tasks. For example, you can set up automated workflows to:
Notify your team when a customer submits a new inquiry
Update ticket statuses as they move through your pipeline
Send follow-up emails automatically after resolving an issue
These automations save time, reduce human error and ensure your team stays on top of every customer interaction.
With its AI and automated customer service tools, Pipedrive empowers SMBs to deliver exceptional customer support in less time while maintaining that personal touch.
Final thoughts
AI customer service is accessible to businesses of all sizes. You just need to invest the time to research best-fit tools that align with your needs and budget.
You can also take advantage of free plans and trials to ensure you’re making the right choice before committing. Try Pipedrive free for 14 days and discover how it can help you build stronger relationships with customers and attract new ones.