71% of retailers invest in AI to attract online shoppers this Christmas as in store sales drop to their lowest levels for a decade

This article is brought to you by Retail Technology Review: 71% of retailers invest in AI to attract online shoppers this Christmas as in store sales drop to their lowest levels for a decade.

With November reported to have the lowest shopper footfall since the 2008 recession and in store sales predicted to get worse in December, a new in-depth research study into how retailers are gearing up their online customer service this Christmas has found that nearly three quarters are investing in Artificial Intelligence in the call centre, driven by consumer demand and changing shopping habits - saving over 1 in 3 retailers £100,000 or more a year. 

The use of AI is also radically transforming where customer service operators can work from. 60% of operators now work from home either in their bedroom, kitchen or study, whilst around a quarter of operators work from locations such as hotel lobbies, cafés, friends’ or parents’ homes, and student accommodation. One in five work from home 100% of the time. 

According to latest figures , 14 high street stores close a day with the possibility of further stores collapsing in January 2019. John Lewis, Marks and Spencer and Primark recently posted a fall in like-for-like sales, House of Fraser has closed more stores, while the boss of M&S warns of “challenging” trading conditions for the remainder of the financial year. 

The new study, by the UK’s fastest growing managed cloud communications provider, Olive Communications interviewed 500 call centre operators, 1,000 consumers and 500 Heads of Customer Service in retail and ecommerce. It found that 59% of the 500 retailers questioned have invested in Virtual Call Centre Agents (chatbots that handle minor queries before passing to a human agent) to radically transform their customer service and productivity. 

Forty-two per cent use Virtual Agent led Live Chat (live chat managed by a chatbot rather than a human) and 22% utilise Agent Assist technology –which transfers an unresolved enquiry to a human agent with full context of the Virtual Agent conversation, and continues to support with real-time coaching, research and call analytics. 

By using natural language processing (a branch of artificial intelligence that helps computers understand, interpret and manipulate human language) the Virtual Agent understands what customers are saying, chatting or texting without requiring specific phrasing, and responds in real-time. In addition, services such as Agent Assist (which provide insight, content and assistance to the live, ‘human’ agent) helps the agent to be more accurate, informed and responsive, thereby delivering a cognisant response and superior customer experience.

According to a quarter of retailers polled, AI will add another layer of intelligence, data and insight that online customer service agents can use for smarter, more personalised interactions while 56% said customer queries are resolved at greater speeds.

Consumers driving AI demand

Olive Communication’s study also discovered that a massive 82% of the 1,000 customers polled prefer the speed and 38% the convenience of virtual customer service agents. 80% of busy working parents and 88% of students highlighted how ‘it’s much quicker’ to speak with a virtual agent, and it’s not just the instant generation driving this demand. 87% of Baby Boomers, compared to 85% of Gen Z’s commented on the speed of using chatbots in call centres. 

Martin Flick, CEO of Olive Communications comments on the findings. “With customer experience predicted to overtake price and product by 2020, retailers must be prepared to evolve to offer a more personalised experience, which our research has proved must be quick and convenient for the customer across all channels.

“Customers get frustrated if they need to repeat their issues to multiple representatives. The latest advanced AI powered contact centre technology removes this frustration, empowers the agent and the retailer while delivering a seamless customer experience.” 

Dr Tim Denison, Director of Retail Intelligence at Ipsos Retail Performance added, “We’re all part of a ‘now’ society, in which consumers expect a personalised, instant and frictionless experience in which we buy on demand at our convenience. Retail is constantly pursuing new initiatives to push the envelope, from grocery deliveries within the hour to chatbot technology opening up a smarter, rapid-response  communication channel between consumer and retailer. We cannot underestimate the future importance of AI to improving customer service and experience, particularly for fielding on-line shopping queries.

“Ipsos MORI’s recent Captains of Industry survey highlighted that right across UK boardrooms the customer experience is gaining importance,” continued Dr Denison. “To deliver service excellence, business processes need to be aligned with the customer journey and any structural constraints that diminish the customer experience removed. It’s not solely about technology though. Valuing and empowering staff is key to getting this right.”

More operators needed, but their role is changing

And it’s not just the customer and retailer benefiting from an AI Christmas. With greater investment in AI comes greater investment in people. 

81% of retailers said they will be hiring more operators this year compared to last Christmas. The enhanced insight and data on customer buying behaviour from AI means greater targeted customer offerings, resulting in higher call volumes. 

According to half (52%) of the UK retailers, AI in customer service centres is also improving the role of the contact centre operator, making it more challenging and rewarding - and operators agree. 

Nearly a quarter (23%) of the 500 contact centre operators questioned by Olive Communications, say they’re more motivated and challenged since AI was installed in the call centre. Because Virtual Agents handle the repetitive, general customer queries 85% of operators say this frees up their valuable time to focus on more challenging tasks – of which 56% of retailers also acknowledge. 65% of operators have more time per customer yet resolve their queries quicker, and 42% feel much more productive.

Remote call centre operators – saving retailers £100,000+ a year

Thanks to the evolution of AI enabled cloud contact centre solutions Olive Communication’s research also found that more than 1 in 3 (39%) retailers allow their operators to work remotely, with more than a third (35%) claiming that it saves them £100,000+ a year.  44% of retailers will introduce a remote working policy this Christmas.  

More than half (59%) of operators said they feel more empowered with being able to work outside of the call centre, and 42% love the freedom and flexibility it offers. Over a third of working parents particularly highlighted the flexibility as a benefit, with 43% saying how it allowed them to see more of their children and pick them up from school. As a result, over half (51%) of operators are more motivated and engaged with nearly a quarter (22%) feeling greater job satisfaction.   

Martin Flick continued: “AI empowered technology, delivered through a secure, cloud based platform is taking the customer experience to a whole new level of intelligence and transforming the ‘traditional’ contact centre as we know it. Everyone benefits, the customer, the operator and the retailer. It’s a great example of how bots and humans are working side by side to improve the role of the live agent, to transform the customer experience and ultimately boost the retailers’ bottom line.”