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How AI Is Used to Improve Customer Experience in Today’s Business World

This article was updated on November 10, 2022

Smart business leaders have always tried to deliver best-in-class customer experiences. After all, satisfied customers are loyal customers who make more (even bigger) purchases and encourage their friends to do the same. But in today's hyper-competitive marketplace, the customer experience can make or break your business.

Illustration of a group of happy, excited customers standing in front of a large brain, representing AI.

Consumers' expectations have never been higher, but there also have never been more tools to help you engage customers, personalize communication across channels, and deliver superb customer service — all with the help of AI customer experience technology from leading cloud communication providers.

What Is the Role of Artificial Intelligence in Customer Service?

Intelligent customer experience is the use of artificial intelligence (AI) technologies to create a seamless, personalized customer journey — from a prospect's initial online search to your follow-up marketing to the first sale, and every interaction that follows. All the behavioral data you collect along the way gets integrated and used to remove friction at every touchpoint.

Simply put, a well-designed AI customer experience helps you better understand and engage individual customers. So whether a customer is consuming your marketing content, contacting customer service, or making a purchase, your message is consistent and personalized, and your team knows exactly who they're talking to and why.

Intelligent customer experience doesn't just make your buyer's journey more seamless. It also makes your team more efficient, thanks to AI-powered chatbots and voice assistants that help lighten the load, and more effective, thanks to intelligent routing and AI-derived insights and prompts.

Why Customer Experience Matters

When customers have a great experience with your company, you earn their repeat business and perhaps even their referrals — but only if you keep engaging them and delivering consistently great service. According to the Vonage Global Customer Engagement Report 2022, 46% of consumers will switch to another business after a frustrating customer experience, 46% will complain to the service provider, and 24% of customers will post to social media or write online reviews about the poor experience. Consumer expectations have skyrocketed as technology develops, but multiple studies show that a large majority of customers feel that brands are failing to deliver the customer experience they expect. Thus, it’s more important than ever to make sure you optimize the customer experience to meet those expectations.

Specific Ways That AI Improves Customer Experience

Enterprise use of AI has expanded rapidly in recent years. NewVantage Partners' Big Data and AI Executive Survey 2021 found that 77% are using AI in some capacity, and 96% say the technology has helped them achieve successful outcomes, up 25% from 2020. When you build an AI customer experience, your business gains several advantages:

Save Customers Time and Money

Chatbots, virtual assistants, and in-app communications APIs make the customer experience more convenient. Our latest Global Customer Engagement Report emphasizes that AI can help businesses create more winning customer experiences. For example, the report reveals that 63% of customers express frustration with long wait times to speak to an agent. With AI, businesses can use virtual assistants to eliminate long hold times for common requests — saving customers time and frustration.

Engage Customers With New Sales Opportunities

AI can help inspire more purchases with personalized product recommendations and special offers. It can remind customers when it's time to reorder products based on buying history. And by adding communications APIs to your website and apps, customers can ask questions about products without leaving the product page and complete purchases via chatbot.

Improve Customer Retention

The Global Customer Engagement Report 2022 reveals that 53% of customers will become more loyal to a business after a great customer experience. Likewise, 36% of customers are likely to purchase additional products.

While you might be inclined to think that customers are more likely to complain after a bad customer experience, the Global Customer Engagement Report also shows that they’re eager to spread the word after a positive experience! After a great customer experience, 53% of customers will become more loyal to a business or service provider, 58% will tell their friends and family about the company, and 34% of customers said they would post to social media or write online reviews.

Increase Employee Productivity

By intelligently routing customers, qualifying sales leads, and offloading customer service tasks, AI frees up human agents to focus on their core competencies and insights that help them work more efficiently. Accenture predicts that introducing AI will increase enterprise productivity up to 80% by 2035.

Make Data-Driven Decisions That Improve the Customer Experience

While your AI-powered solutions are enhancing the customer experience, they're also gathering and analyzing data that can help you better understand the customer journey and identify pain points that could lead to customer churn. This information helps you better train your team, remove friction at various touchpoints, and streamline workflows.

Tools Needed To Create An Intelligent Experience

When it comes to creating best-in-class customer experiences, the bar is high, and so are the stakes. Fortunately, cloud-based AI customer experience technology has leveled the playing field, making it possible for businesses of all shapes and sizes to compete based on customer experience.

If you’re not sure where to start, you might consider leveraging Communications APIs, your CRM, and a low-code AI solution to start delivering intelligent omnichannel customer experiences.

Communications APIs 

Communications APIs let you integrate different communication channels and add new ones.

When building your communications stack, you can piece together apps from different vendors, using APIs to integrate them. Or you can invest in a unified communications platform, like Vonage Business Communications, which has already combined all the standard communication channels — voice calling, video conferencing, and instant messaging — into one unified user experience. That means your team can switch seamlessly from one to another based on customer preferences.

Then you can use communications APIs to build those communication channels directly into your website, mobile apps, and contact center platform. Customers will be able to call or message you in one click without closing their browser or leaving the app.

Vonage APIs also let you add new communications channels and AI functionality, such as:

  • Voice: The Vonage Voice API lets you create automated, personalized customer interactions powered by sophisticated machine learning algorithms. This includes virtual assistants that intelligently route customers to the right contact center representative or voice bots that answer customers' questions, qualify sales leads, and enable 24/7 self-service. The Voice API also enables multichannel recording, interactive voice response (IVR), text-to-speech, and sentiment analysis.

  • Video: The Vonage Video API lets you build a custom live chat experience into your website or mobile app. In this way, customers can communicate with you without downloading or signing into third-party apps, and you can capture the communication history and integrate it with other customer data for deeper analytics.

  • Messaging: The Vonage Messages API lets you build private, two-way SMS into your apps and website so customers can safely and seamlessly book appointments, check order status, and even complete transactions via text message. It also lets you send automated, relevant messages at the right time to the right users, including appointment reminders, sale notifications, and delivery confirmations.

APIs also enable you to integrate all these communication channels with your CRM.

illustration of hand holding phone with chatbot on the screen GLOBAL RESEARCH STUDY
Maximizing the Omnichannel CX with AI
Despite recent rapid digital transformation efforts, only 45% of consumers are "very satisfied" with their business communications. That means big opportunities for the companies who get it right. Get the data and learn how AI can help with our 11th annual Global Customer Engagement Report.

Customer Relationship Manager (CRM)

When you integrate your communications apps and APIs with your CRM, you also integrate their data, which creates new opportunities to apply and leverage AI functionality.

When a customer reaches out to your business, the call or message can be routed to the correct agent based on customer history. Before the agent joins the conversation, they see screen pops with customer history data and AI-generated predictions about why they might be calling. It also alerts the agent to other business that could be handled during the call — for example, information that needs to be updated or anticipated future needs. That conversation, and all the data derived from it, are then automatically logged into CRM to be used for marketing, sales, and the next customer service interactions.

Low-Code AI Solutions

While the prospect of implementing AI to enhance your customer service may seem daunting, it doesn’t have to be. AI once seemed futuristic, but now low-code AI solutions make it easier than ever to get started. 

If your business is just starting to dive into the world of AI, consider how a low-code/no-code AI solution can help. Offerings like Vonage AI Studio offer low-code conversation design solutions that empowers developers and non-developers to create and deploy customer service experiences that operate in natural language across channels.

Other AI Customer Experience Solutions

What are the most valuable AI customer experience solutions?

Virtual Assistants

AI-driven virtual assistants can replace phone trees with conversational, intelligent routing, so customers don't have to listen and respond to lists of options to (hopefully) find the right agent. Instead, they simply tell the virtual assistant what they need, and the AI uses that information and customer history data to connect them with the appropriate person. The virtual assistant can also answer simple questions and, depending on your integrations, provide support and complete purchases.

With an advanced virtual assistant like Vonage's, the AI analyzes customer sentiment and feedback in real time, using words and content to respond more effectively. If at any point the customer wants to talk to a human, the virtual assistant can pass them to an agent with a full summary of what was already discussed so the customer doesn't have to repeat themselves.


Chatbots are like virtual assistants but in writing. They can direct inquiries, answer questions, and enable self-service. You can add them to your website, app, and social media properties, allowing customers to engage with your brand anytime and get quick answers to their questions without leaving your content or product listings.

Chatbots are a great part of a conversational commerce strategy, particularly for in-channel engagement. After all, you’ve gone through the effort to reach customers on their favorite platform — and nothing can negate that experience faster than asking them to go elsewhere. So consider integrating chatbots to:

  • Nix the hold time: AI-powered chatbots can help eliminate long hold times, particularly for common requests.

  • Create 24/7 sales and service: Chatbots anticipate questions and suggest appropriate products and options. Think of it as being a step ahead to provide shipping info, confirm inventory/size/color, or perhaps route customers to a personalized in-store visit. The constant in-channel engagement can help nurture customers through the purchasing cycle.

Sentiment Analysis

Sentiment analysis AI bots listen in on conversations and give you real-time insight into a customer's emotions. This can help you know when they're engaged or when they're annoyed. If the AI detects escalating frustration during chatbot or virtual assistant interactions, it can automatically engage a human representative. And if customers are unhappy with the agent's service, it can loop in an expert supervisor. Vonage’s Sentiment Analysis solution also provides agents with clear, real-time feedback they can use to improve their skills and provides managers with insights they can use to better coach their teams and improve the customer experience.

Speech Recognition

Speech recognition AI uses natural language processing to better understand customers and respond conversationally. It powers everything from IVR to virtual assistants and chatbots to call transcription. Speech recognition can also be used as a security measure to verify customer identity and let them access account information and self-service options.

Employ AI In Your Business to Start Seeing Results 

Not long ago, AI was reserved for large tech companies with large budgets. Now it's everywhere, powering the apps and services we all use every day. Delivering an AI customer experience is within reach for all businesses, but the use cases vary from one company to another.

Which solutions do you need to deliver a convenient, personalized omnichannel experience? Check out Vonage’s Conversational AI solutions to learn more about AI built for businesses just like yours.

Tim Kimber
Tim Kimber

Director of Product Marketing at Vonage

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