In the rapidly evolving world of AI, the question isn’t just about embracing technology but about doing so in a way that truly benefits the customer. The recent White House announcement that talks about legislation to help American consumers receive better customer service, particularly by addressing negative chatbot experiences, underscores a growing concern: Are we enhancing customer engagement or simply automating frustration?
Whether new legislation will be passed or not is irrelevant at this point. What is relevant though is that poor customer experiences and frustration stemming from such experiences has percolated to the top. So the key question is what can institution operators do to get the best of both worlds: improved efficiency through deployment of chatbots and AI based systems, and improved customer experience.
In this post I will provide 5 practical suggestions that can have a major impact on improved customer experience without limiting the effectiveness of chatbots/AI. If deployed correctly and regardless of upcoming legislation, it will put your institution in a great position going forward.
- Provide an escape hatch. This one seems obvious but is often overlooked by the vendors and institutions alike. Chatbots work great when they work but they have limits in what they understand and what they can achieve on behalf of the customer. In some cases, the limits can be reached quite easily and customers are left frustrated by trying to bypass the overly persistent (but not very capable) chatbot. In order to reduce frustration, it is imperative to provide an easily accessible escape hatch – a mechanism that allows the customer to get out of the chatbot experience and transfer to a more interactive (human) one. It should be available on every screen/prompt/listing and completely break out of chatbot control.
- Focus on task completion, not deflection. Too many institutions measure success by how many interactions the chatbot handles without human intervention. This is a misguided metric. What truly matters is whether the customer achieves their desired outcome. By focusing on task completion rates instead of deflection, you can ensure that your AI is genuinely serving customer needs, not just pushing them away from human support.
- Prioritize customer effort reduction, not cost reduction. Cost reduction (and deflection) are primary goals for deploying chatbots in an institution. Nonetheless, they measure impact from the institution’s perspective. A better measure would be to consider the customer experience. I believe the best metric is customer effort reduction; in other words, how much time or steps did the chatbot save the customer, and is it getting better over time. When you prioritize customer effort reduction, you naturally create a better experience, which will, in turn, lead to long-term cost savings and customer loyalty.
- Continuously evolve your chatbot solutions. Technology, and chatbots in particular, are advancing rapidly. The consequence is that even when you deploy a state-of-the-art system, it will be outdated as soon as it is deployed. And if it is not adapting, it will be obsolete. Not to mention that customer expectations are also evolving as better systems and better services are offered by other companies (even outside the financial institution industry - think Amazon and Netflix). Treat your chatbot solution as a living, evolving system that requires constant updates and improvements. Incremental advancements will ensure that your AI remains relevant and effective.
- Choose vendors who acknowledge technology limitations. Even as technology is advancing at a rapid pace, there are limitations and regulations to how it can be deployed and how useful it is. The best partners are those who understand the limitations of current AI technology and are transparent about it. These vendors will not only help you avoid unrealistic expectations but will also guide you toward practical, effective implementations that offer real value. Working with such partners ensures that your chatbot deployment is both effective and realistic, maximizing ROI while managing risk.
The future of service in banking isn’t about choosing between AI and human interaction—it’s about integrating the two in a way that maximizes benefits while minimizing frustration. By following these strategies, you can ensure that your institution is not only compliant with any forthcoming regulations but is also leading the way in delivering a superior customer experience.
Embrace the future, but do so with your customers in mind. The best AI strategy is one that keeps the human element at its core.