Boosting Customer Loyalty With AI

Jun 20, 2019

Artificial Intelligence (AI), blockchain, machine learning, bitcoin – these are all words that many consumers shy away from and are actually turned off by in many instances. But, the reality is so many brands are using these types of technology for good. AI in particular remains on shaky ground. Nearly four out of 10 (39 percent) customers worry about the overall impact of AI, while 49 percent believe AI will lead to diminished privacy.

Additionally, customers are often unclear about what AI even is. While 72 percent of customers across six countries say they understand AI, only 41 percent knew products like Google Home and Amazon Alexa rely on the technology.

AI has improved loyalty programs by leaps and bounds, enabling brands to create engaging, memorable and personal experiences for their most loyal shoppers. But, it’s important to be cautious when implementing AI so that catastrophes or perceived privacy infringements don’t occur and your customers continue to have the best overall experience.


Perfect AI tactics with machine learning and human oversight


Most fraud-type instances can be prevented by better and smarter algorithms. Brands with AI strategies need to use machine learning technology to constantly improve algorithms, so that mistakes can’t happen. Relying on human oversight to make smarter judgments can help catch potential mishaps AI technology might otherwise miss.

For example, an algorithm could detect potentially fraudulent activity and flag your VIP members so that real employees could do further investigations before immediately shutting people out of their accounts. Any time AI is involved, the human touch is still critical for success.


Personalize, but don’t take away choice


When is too much personalization a bad thing? When it takes away choices from your shoppers. Accurate product recommendations, promotional discounts based on past behavior and individualized rewards are always a good thing. However, brands that go too far in trying to craft personalized experiences for customers risk getting it all wrong. Instagram learned this the hard way after it changed its algorithms so that social posts no longer displayed chronologically. Users perceived this move as a controlling one from the platform, and felt they were missing the content they wanted to see. The brand has since responded by tweaking its algorithms to return to a more chronological approach.

Understand that your loyal customers love your brand for what it is. While you should tailor your program to individuals, don’t go overboard or you’ll risk restricting how customers engage with your brand.

Remember: AI is a tactic that allows you to craft better experiences for your customers, but it can’t take center stage. Personalize experiences to the best of your ability, while still allowing your customers to experience your brand organically and on their own terms.

Read more about choice in the customer experience here.