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Artificial intelligence (AI) will completely transform customer service in the coming years—and retail businesses can benefit from this emerging technology more quickly than you might think. That’s according to a report by Forrester that explores the impact of AI on customer service.

In fact, many customers have already brought some form of intelligent system home with them. Nearly half of customers happily chat with virtual assistants like Siri and Cortana and they’ve come to expect smart interactions, like personalized recommendations from Netflix, or down-to-the-minute arrival times from rideshare services, Forrester says. With all of these personalized, convenient, and targeted experiences powered by AI, customers now expect intelligent and predictive services across the board—including in the retail space.

Thankfully, what’s good for customers is also good for retailers. By applying advancements in analytics, cloud computing, and intelligence technologies to large volumes of data, companies can increase engagement, discover new income streams, and empower customer service representatives to connect with customers in ways that foster loyalty and drive growth.

AI deepens engagement

The more data that AI touches, the smarter it becomes. Cloud computing brings a consistent platform to combine systems and departments, bringing improved visibility across multiple areas of the business. And with the ability to rapidly collect, track, and sift through information, retailers can use AI to pinpoint trends and pain points that may affect customer satisfaction and retention—often before humans are even aware of them.

Armed with this insight, retailers can preemptively plan for changes, like embracing digital disruption and discovering new income streams. By marrying in-store and digital experiences, like IoT-enabled home shopping and buy online pick up in store (BOPUS), retailers can create a cohesive commerce strategy that will appeal to an ever-larger part of their customer base.

Algorithms can also help retailers make real-time decisions as business needs change. They can streamline onboarding, predict customer satisfaction, optimize inventory, and even schedule maintenance appointments post-sale. Models can determine the best times to educate and incentivize customers, giving retailers deep insight into how to facilitate positive customer relationships and boost sales.

Today’s customer expects a consistent and personalized experience, whether in-store or online. Forrester cites that nearly 80 percent of consumers said they won’t buy from a brand until it demonstrates that it understands and cares about its customers. AI offers extreme personalization throughout all stages of the customer journey, making it a critical part of delivering innovative and individualized experiences that exceed customer expectations and incentivize customers to shop in a physical store.

AI augments people

As AI gains a foothold in everyday customer experiences, human interaction means more than ever before. While organizations increasingly rely on automation for repetitive and predictable tasks, customer service representatives have more time for deeper and more meaningful customer interactions. Instead of collecting rote information, they can solve complex problems. In a digital-first world, nurturing better (and more profitable) customer relationships will be a key differentiator for retailers.

With the right tools in their hands, customer service agents can use data, like buying propensity and transaction history, to recommend targeted products that augment a customer’s base purchase and demonstrate an understanding of individual needs and desires.

It’s time for a strategy

AI is here, and it’s evolving rapidly. As more tech-savvy customers prefer to shop at their convenience—whenever and wherever—retailers must consider new ways for customers to order, purchase, and receive merchandise. To meet customer expectations, retailers must invest in new tools that help them to create personalized products and experiences for customers (online and in store) and drive business decisions with the associated data.

If you’re just getting started with your AI strategy, consider what your data resources look like, and how they are managed.  Customers are, of course, creating more data than ever before.  Once your data is in order, choose one or two processes that you’d like to improve and analyze. Use these small wins as a springboard for larger initiatives. Finally, invest in people who have the knowledge and skills to help you set long-term goals for your strategy, like preparing models and acting on insights. After all, AI is a tool, not a catch-all solution.

To learn more about these insights from Forrester and to start building your roadmap for AI-driven customer service, read the free report.