Customer Service Automation – What Risks Are There for the Customer Experience?

Customer Service Automation, especially chatbots and AI-based solutions, is spreading rapidly even in smaller organizations. And it's no wonder, as automation offers attractive advantages: faster responses for customers and labor cost savings for organizations. A good example of the latter is Klarna’s announcement in August, where they revealed plans to reduce their workforce from about 5,000 to 2,000 employees and let AI handle part of the workload. Pretty staggering numbers, right? I am keenly following how Klarna will implement these changes and how they will impact the customer experience, both in their client companies and for end-user customers.

But is customer service automation always the best solution from the customer's perspective? I have years of experience in customer-facing roles and am passionate about customer experience, so I want to also explore the challenges and risks of automation that organizations should consider and reflect on in relation to their desired brand image.

The most frustrating part is when the bot doesn’t understand

One of the biggest risks in automating customer service is the loss of personal connection. Customers value human interaction, especially when they are dealing with complex or emotionally charged issues. AI can feel impersonal and leave the customer alone in the process.

If (and with current solutions, WHEN) the customer feels that their needs are not understood and the chatbot continuously gives incorrect, inaccurate, or vague answers, this easily leads to frustration and a negative customer experience. This inevitably harms the brand and weakens customer relationships.

Recently, the widespread outages in Nordea's online banking service have caused a lot of harm and frustration for users, but I must mention that, personally, I have been really satisfied with their chatbot. I would almost say it's the only chatbot I've used that has quickly and easily given me answers to my questions without sending me into a nerve-wracking loop where the bot repeats the same useless answers and my blood pressure starts to rise.

If a chatbot can't answer the question or provides overly general instructions, the customer has to wait to be transferred to a human agent. This slows down the service process and once again causes unnecessary frustration. Chat services can also be a slow way to handle things, even when you finally reach a customer service agent. Did you know that in companies, customer service representatives often handle several chat conversations with different customers simultaneously? This alone causes delays in responses, and in addition, typing takes time for both parties. Often, things would be resolved more quickly by talking, but I still wouldn’t wholeheartedly recommend calling customer service either. The minute-long "If your issue concerns X, press 2" is all too familiar!

Emotions at play

Artificial intelligence is unable to recognize a customer's emotions or interpret the nuances of a situation in the same way a human can. When a customer is stressed, irritated, or anxious, a robot's flat response can worsen the situation. This can easily cause the customer to feel that their problem is not being taken seriously. At worst, AI can give the impression that the customer is not important to your organization. A poorly trained bot can even drive your customers to a competitor who can offer better service! The fact is that even in the most well-considered purchasing decision, emotions are strongly involved throughout the entire process, and the process doesn't end when the customer's money reaches your account.

It is therefore important to find the right balance between automation and human contact. Excessive automation can lead to customers feeling isolated or unvalued, and they may not receive the service they want. This can easily happen when customers have urgent or personal questions that require human empathy and flexibility. Customers desire a smooth opportunity to transition from automation to human assistance when the situation demands it. For this reason, I do not recommend fully automated customer service, even if it may seem to save time and resources in the short term. Whether it's a bot or not, the most important thing is always to build services so well that their use is as clear and easy as possible.

Automation in customer service is an excellent tool, but at this stage of development, it should still be used cautiously, ensuring that customers always have the option to speak with a real person when necessary. Technology is important, but it still can't replace human interaction. I am quite excited about technological development, but a part of me still hopes that humans will never be fully replaced. What do you think?!