Jul 21, 2023 Brian Tervo, CEO

Why Human Touch Still Matters in the Era of AI-Based Retail Chatbots

Human Touch Still Matters in the Era of AI-Based Retail Chatbots

Are chatbots really the end-all solution for customer support? The short answer: No.
With their rise in popularity, it's easy to assume that they have taken the place of human customer service representatives. However, anyone who has dealt with the frustration of chatbots misunderstanding their questions knows that this couldn't be further from the truth.

In this blog, we'll highlight the differences between chatbots and conversational AI, and explain how they can be used as tools to help, not replace, human agents.

Chatbots Aren't Dead, Just Getting Smarter

Remember when the word 'chatbot' used to make you cringe? In the early days, these digital assistants were notorious for slow, robotic responses that were, at best, irrelevant, and at worst, completely wrong. As a retailer, if you'd pinned your hopes on these bots easing your customer service headaches, you probably found yourself grappling with even more issues.
Fast forward to today, and chatbots are a far cry from their predecessors. They've evolved from simply parroting pre-programmed responses to engaging in almost human-like conversations. This is the key difference between traditional chatbots and the newer, more advanced conversational AI tools: while the former are bound by scripts, the latter use machine learning to continually improve and offer more authentic, natural interactions.
In the retail world, this shift has made a huge difference — and not just in customer service. Now, chatbots are assisting customers in product selection, guiding them through complex procedures, and — like in the case of Whole Foods — even helping customers discover recipes, locate food items in-store, and find suitable replacements for dietary restrictions.
But the real breakthrough, which we'll cover later, is the marriage of AI and human interaction. Since conversational AI handles routine questions, it frees up human agents to tackle the more complex issues. This fusion of AI-powered and human-led service not only boosts efficiency, but also enriches the customer experience.

How AI-Based Chatbots Benefit Retailers

Patience is a virtue that few possess, especially when it comes to customer service. In fact, 53% of customers find waiting too long for replies is the most frustrating part of interacting with a business — and businesses that fail to respond quickly risk losing out on sales.
Here's how AI-based chatbots can act like an extension of your customer service team: 
Your 24/7 Support Hero 
Imagine it's peak hours, your agents are swamped, and there's a surge of queries coming in. It's a situation that could quickly turn into a customer service nightmare, but with a chatbot, you have a reliable ally. They provide instant responses to basic questions, fulfilling the modern customer's desire for immediate gratification. They're always available to offer 24/7 support, and they have the ability to handle multiple customers simultaneously.

A Seamless Bridge Across Platforms 
Your customers are everywhere — browsing your website, scrolling through your social media, checking out your mobile app. With chatbots, you can ensure a seamless experience across all these channels. They can be integrated with various platforms and even marketing software to ensure continuity, preventing customers from having to repeat information or steps.

Consistent Support at Scale
Consistency is key in building trust. With chatbots, you can guarantee the same level of service and information across all platforms. Unlike human agents whose responses may vary, potentially diluting the brand experience, chatbots maintain a uniform tone and content, reinforcing your brand's identity. 

Your Silent Salesperson
Chatbots aren't just about providing answers; they're also about asking the right questions. By analyzing website visitors' behaviors, chatbots can effectively qualify leads, filter out the unqualified ones, and focus on potential customers. They can send automated follow-up messages, provide timely reminders about abandoned shopping carts, and even suggest products based on user behavior to gently nudge prospective customers down the sales funnel.

An Economical Solution
Chatbots are not only efficient but also cost-effective. They don't require extensive training like human agents do, which can lead to substantial savings. Plus, they can handle multiple conversations simultaneously, enabling businesses to manage large volumes of queries without necessarily needing to increase the size of their customer service team.

Chatbots vs. Humans: Limitations in Customer Service

The choice between deploying chatbots or relying solely on human agents isn't binary, but rather a nuanced decision that requires careful consideration of the costs, benefits and limitations of both. For chatbots, these limitations include:

  • Transition to Phone Calls: If a customer prefers switching from online chat to a phone call, chatbots are unable to transition between different modes of communication.

  • Technical Complexity: The more complex the chatbot, the higher the degree of technical expertise needed to operate it.

  • Poor Emotional Intelligence: Chatbots lack empathy, failing to perceive and respond to human emotions, making interactions feel impersonal —  especially in sensitive situations.

  • Lack of Contextual Understanding: Chatbots often struggle to understand context, especially when dealing with the subtleties of human language like sarcasm, humor, or double entendre. 

  • Impersonal Experiences: A chatbot's ability to tailor responses is largely dependent on the quality and quantity of available data. Without sufficient data, chatbots will provide generic responses.  

On the other side of the spectrum, here's where human agents fall short: 

  • Limited Availability: Humans, unlike their AI counterparts, need breaks. They can't work round-the-clock and require time off for holidays and sick leaves.

  • Inconsistent Service Quality: Quality of service can vary depending on a range of factors, from the representative's knowledge to their mood and attitude.

  • Scalability Issues: Human agents can only handle so many customers at once, which might lead to longer waiting times during peak hours or seasons.

  • Emotional Management: Dealing with irate customers is emotionally draining. This stress can impact an agent's performance and overall well-being.

  • Limited Multitasking: Despite our best efforts, humans aren't built to multitask efficiently. As tasks pile up, productivity declines, response times slow down, and errors creep in.

Why Human Touch Still Matters

There's a reason why conversational AI tools are said to produce human-like responses — while sophisticated, they still lack the nuance, emotional context, and adaptability that's innately human. That's one reason, perhaps, why a staggering 82% of customers crave more human interactions.
While AI-based chatbots can fill certain gaps, they cannot replace the unique human ability to handle complex situations, resolve conflicts with empathy, adapt to unique circumstances, and carry out physical reviews and inspections. Here's why:
Resolving Conflicts 
Angry customers are a challenge, but they also present an opportunity to demonstrate exceptional customer service. Even if customers don't directly state that they're angry, a human can detect subtle signs of frustration, understand their feelings, and offer sympathy. They can also react on their feet, offering an actionable solution or suggestion, while a bot may falter if its data is limited.

Personalizing Experiences with Empathy 
Human beings are biologically wired to understand and respond to emotions, which makes them uniquely qualified to provide a truly personalized experience. It's the warm, understanding voice on the other end of the line; the reassurance that you're not just a ticket number — these are the moments that shift customer service from transactional to transformative.

Adapting to Unique Circumstances 
Humans excel in thinking outside the box. They can adapt to new situations, respond uniquely, and solve problems that machines may not even recognize — for example, if a customer has an unusual request like arranging a surprise delivery or sourcing a hard-to-find item.

Assuring Quality with Physical Reviews 
There will be situations that demand human wisdom and presence. Whether it's inspecting a returned item for damage, visually verifying age for restricted products, or personally ensuring the quality of service delivery, human expertise is indispensable.

Brand Reps + AI-Powered Chatbot = The Ultimate Duo

Are you torn between using chatbots or human agents for your customer service? The good news is, you don't have to choose
Think of AI-based chatbots and humans as teammates rather than competitors. Here are some ways they work seamlessly in customer service:

  • Chatbots monitor and analyze feedback across all channels
  • They suggest responses to live agents, streamlining interactions
  • Chatbots route queries to the right team or department
  • They escalate issues that need immediate attention to human agents
  • After each interaction, they provide conversation summaries to live agents
When combined, AI-based chatbots and live human agents result in happier customers, a more productive team, and a thriving business. So why not partner with a company who excels at both? 
ThirdChannel's live chat solution not only optimizes chat routing, but also matches shoppers with brand reps who are passionate, knowledgeable, and dedicated to making every shopper feel valued. Want to see it in action? Schedule your free demo.
Published by Brian Tervo, CEO July 21, 2023
Brian Tervo, CEO