AI and Customer Loyalty

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Artificial intelligence and machine learning have taken the industry by storm. Some say they will usher in a new age of better business processes and customer orientation, while others fret that automation will kill jobs. Both might be true.

There definitely will be jobs that no longer make sense for humans to do, thanks to automation. Generally they're entry level and not much fun, but that begs the question of what, then, becomes an entry-level job.

I took a briefing last week with Conversica, a company that uses AI to do general-purpose triage for early stage sales leads. I am not affiliated with Conversica and I am simply reporting, but the technology seems pretty cool.

Conversica is essentially a bot that responds to things like email with appropriate information and then follows up. When a customer indicates a need to interact with a human, the bot makes the transfer. The bot is tireless and can work 24/7, so there's a lot to like.

This is a good example of automation replacing a human, but I am told the bot simply makes it possible to redeploy the human to another job that requires real human thinking. I am sure it can.

When I see something like this, it's often a new technology applied to an old problem -- and truth be told, that's generally how new technology gets disseminated.

For example, it has taken a long time for social media to establish a niche different from being a cheaper email platform. Some people haven't made the leap in understanding, but generally we're there.

So I fully understand employing modern AI technology to support the sales effort; sales is one of the first stops for new technologies.

However, I'd like to divert your attention for a moment to some business processes that are nearly neglected where AI and ML could make real contributions. They likely would not replace anyone, because a job isn't being done in many cases.

Customer loyalty is an area that could use some help -- even the help of bots. Loyalty always has been a passive thing -- customers are expected to do something that demonstrates loyalty in the moment -- rather than an active thing that businesses pursue.

We expect customers to do something loyal, usually make another purchase, for which we then give out rewards. That's OK, but it misses the point. Rewards are by their nature backward-looking, and loyalty ought to be something of the present and future.

Say I advocate on behalf of a favorite product that may drive future business for the company. Often that's not part of a business' idea of loyalty and so it goes unrewarded, even though it is a good loyalty indicator. Too bad.

Now imagine if you tuned some of your AI muscles toward loyalty. What if you had a bot that caught customers engaging in good behavior and then you rewarded them for it? The reward, not associated with a purchase, might inspire more loyal conduct, and all of this could be done without human intervention.

So, this little exercise just 1) invented a job for a bot, 2) replaced no humans, but 3) improved business performance.

My point is that there are lots of incremental improvements like this example waiting to be discovered as we contemplate using AI. Many of AI's early deployments will be like this -- not very sexy, but useful.

That's what happens on the far side of the hype cycle, after everyone's tried applying the hot new technology to the oldest of problems. It's maybe even after a lot of people have become mildly disenchanted with the failed promises that the new category couldn't deliver.

I've seen this hype cycle movie before, and I am wondering if we might be able to speed up the process. It's really nothing more than imagining new processes rather than being happy pursuing a well-worn path.

Denis Pombriant is a well-known CRM industry researcher, strategist, writer and speaker. His new book, You Can't Buy Customer Loyalty, But You Can Earn It, is now available on Amazon. His 2015 book, Solve for the Customer, is also available there. He can be reached at [email protected]

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