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AI Customer Engagement: AI-Enhanced Customer Communications Predictions 2024

This article was published on January 9, 2024

2023 may have been the year of AI — but only the first one of many to come. With so many advancements and refinements coming down the pipeline, you can expect the technology to take an even larger share of the stage in 2024. How will AI transform customer engagement, exactly?

For customers, that means greater functionality, less waiting, and more reasons to engage with your company via multiple channels. For businesses, it'll mean more opportunities to build AI customer engagement directly into what they do best, with fewer of the integration pains and hurdles that tend to come along with disruptive new technology.

Intrigued yet? Here's a look at anticipated trends and developments in AI-enhanced customer communication, with a focus on the impact of AI on customer engagement and satisfaction.


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Prediction 1: Generative AI will revolutionize personalized communications

Generative AI, which learns from existing data and content, has seen major breakthroughs in the past 12 months. It's leaped so far so fast that experts like McKinsey call 2023 a "breakout year" for the technology. Looking at the research leader's numbers, it's hard to disagree with the takeaway: Early AI adopters plan to use it to reduce core business costs (19%), create new revenue sources (23%), and increase revenue from the core business model (27%).

In terms of AI for customer engagement, the technology's benefits are clear. Because it learns from data the business already has and generates, the options available to AI-powered tools are many from the get-go. And because the tools can pull information from multiple systems at once, it's easier to present personalized communications offerings — everything from on-the-spot guidance to deeply nuanced marketing materials and ad copy — across channels.

In a time where segmentation-based outreach rules sales and marketing, it shouldn't come as a surprise that more customization leads to greater engagement. However, being able to automate the activity with some careful forethought and planning is a huge next step in any context. Look for more companies to take advantage of this tremendous potential at their fingertips in 2024.

Prediction 2: "Flowing" AI-powered customer relationships will become the norm

Personalization doesn't occur in a vacuum. Providing it in a way that entices customers to keep coming back requires a deep insight into numerous background data points, and many such discoveries are so subtle or hard to link that entire teams of humans might overlook them.

Some leaders, like Starbucks, covered in a recent Harvard Business Review (HBR) piece, have already shown us what an AI for customer experience can look like. Their app is deep with personalization offers based on the customer's past shopping activities and numerous other data points. Starbucks also runs weekly randomized trials on their customers to learn more about them and further focus their marketing.

Now, with the technology democratizing and becoming easier for smaller businesses to harness, it's only a matter of time until tailored experiences become the norm or take a large step toward being the norm. The same HBR piece notes that Starbucks has seen a 300% increase in net incremental revenue. This is promising for the future of the AI customer experience.

Prediction 3: AI will become a valuable fraud-fighting tool

Verification and fraud-fighting often have a customer communication component (think: a verify API using SMS or WhatsApp to send one-time passwords in a two-factor authentication setup). A proper fraud detection scheme improves the customer experience and engagement without making customers jump through too many extra hoops to get where they're going. And we already know how AI can pull from — and make unique insights out of — data from highly disparate sources.

Those factors together point to AI as a strong fraud-fighting tool, and industries like finance and banking have already bought in. In those fields, institutions use AI to detect and deny fraudulent transactions based on factors like geographic location. 

In 2024, plan to see more AI-backed fraud detection tools discovering fraudulent patterns. Likewise, it's fair to assume more businesses in banking and beyond will use similar tools to detect and fight off costly exploits like toll fraud. Companies need to walk the line between a great customer experience and true protection for their users, and a properly configured AI is perhaps the fastest way to hit the sweet spot.


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Around the World with CX Insights
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Prediction 4: AI-based APIs will proliferate AI customer engagement opportunities

Returning for a moment to the idea of AI democratizing — we see a strong trend toward exactly that in 2024 and beyond, just as HBR does in another AI-focused piece from 2023.

As with a lot of major new technologies, the biggest hurdles with AI customer engagement tools come down to figuring out how to utilize the potential at play and figuring out how to implement or develop tools that will get you there. API-based development, which gives businesses advanced capabilities in a highly configurable format, allows for both while speeding time to market, rolling out in a matter of hours or days instead of months or years.

For AI customer engagement, that means a faster track to happier, more enthused customers with far less heavy lifting. Advanced chatbots and AI-based customer service agents that pull from existing data sets to make personalized suggestions and intelligently route customers to the right human agents are just one example.

Relatively few companies have the resources available to develop AI-backed technologies from scratch, and even fewer can get those capabilities to market fast enough to make a dent in early adopting competition. In that regard, API-based development tools should serve as a strong equalizer for businesses of all sizes in 2024 and beyond, helping everyone level the playing field with the most disruptive new technology since smartphones.


Prediction 5: AI-powered customer engagement will kick-start productivity 

We've all heard the worrying news about AI disrupting the job market, but there's reason to believe things could shift in another direction. Companies that make smart use of the technology will be able to drastically increase productivity without adding to their current employees' workloads.

How will AI change customer experiences? Intelligent AI-powered customer engagement agents will step into the spotlight in 2024, solving an increasingly complex array of problems in customer communication, answering even more complex questions, and managing tasks that directly increase engagement and productivity (e.g., giving customers someone to talk to for simple questions and intelligently routing them to the right desk the first time).

Look for more companies to find ways to empower their existing workflows and boost productivity as AI becomes more accessible to all businesses in 2024.

AI can level up your customer experience 

With technology as powerful and omni-capable as AI, our predictions are just the start of what AI will do to boost customer engagement in 2024.

Check out Vonage AI Studio for some of our AI-powered customer engagement capabilities.

headshot photo of Steven Giuffre, Senior Product Marketing Manager for Vonage Voice API
By Steven Giuffre Senior Manager, Vonage APIs

Steven Giuffre is a Senior Manager for Vonage APIs. He leverages his Conversational AI and Voice expertise to promote personalized communications across channels for brands to deliver richer conversations and context to their customers. Steven lives in Los Angeles, where he enjoys beach life, films of most genres, Rams football, and his dog, Roxy.

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