Is AI’s (in)efficiency hindering brands' connection with consumers?

Consumers want to be told, "everything will be alright" but AI quite often adds to our stress and anxiety.

How often do you visit a restaurant, a hotel, or a cafe and form a special bond with a particular staff member? You notice the name on their badge, call them by their name, and acknowledge their efforts with a smile. However, in three recent brand experiences, I found myself unable to express that gratitude—or even feel reassured that my sensitive information was being handled with human care.

For starters, an AI bot at a bank failed to understand my query involving a big transaction over the phone and eventually disconnected the call. This happened repeatedly for two days until I had to visit the branch in person to resolve the issue. In another case, activating international roaming on my phone turned into a lengthy ordeal, all because I was interacting with a WhatsApp bot that couldn’t process my request. And finally, a food delivery service failed to deliver my order, and I spent three frustrating hours trying to resolve the issue with yet another AI chatbot.

These experiences highlight a critical question: Are brands relying too heavily on AI for customer service and after-sales support and ignoring the impact it has on customer experience?

The customer service landscape is undergoing a significant transformation. AI-driven bots are becoming increasingly prevalent, offering 24/7 availability, and the ability to handle multiple queries simultaneously.

However, a report by ServiceNow research indicates that while two-thirds of Indians have increased trust in generative AI for customer service over the past year, 90% still encounter accessibility barriers when engaging with a brand’s customer service. Additionally, nearly a quarter of Indians report feeling stressed (27%), angry (24%), or anxious (22%) during such interactions.

Shan Jain, an independent director, brand strategist, and marketing transformation advisor, notes, “The key to balancing AI-driven bots and human customer service lies in understanding the delicate tripartite agreement between efficiency, customer experience, and maintaining the brand’s voice.” She cautions against sacrificing the warmth and personalisation that define a brand’s identity for the sake of efficiency. “Imagine calling up a brand you love, only to be met with a bot that has as much personality as a dial tone. If your brand is known for warmth and personalisation, letting a bot be your ambassador can feel like a betrayal.”

Gaurav Sablania, head of product at Hogarth- a WPP-owned marketing implementation company echoes this sentiment, emphasising that while AI chatbots are useful for basic inquiries in a contactless service environment, they fall short in addressing more complex issues. “During a crisis, people need more than what an AI-based chatbot can offer in terms of empathy, kindness, and coherence.”

On the other hand, Vivek Kumar Anand, chief business officer at DViO Digital- a digital marketing company advocates for viewing AI as a co-pilot rather than the captain of customer service. “AI should be leveraged as a co-pilot, not as the captain of customer service. It’s akin to having a highly efficient assistant who handles routine tasks but knows when to hand over the controls to a human when things get complex,” he explains.

The limitations of AI

The integration of AI into customer service is not premature but a necessary evolution. Vaibhav Velhankar, chief technology officer, Segumento, an AI-based data intelligence platform, observes, “As AI technology advances, we are moving from a ‘Human First, AI Second’ model to one where AI takes on more routine and procedural tasks while human agents handle more nuanced and complex issues.”

Velhankar also stresses the importance of evaluating human-bot interactions through various lenses, such as urgency, monetary value, language, and sensitivity. “For interactions involving significant monetary transactions or sensitive issues, human involvement remains essential. The goal is not to choose between a human or AI but to leverage both effectively,” he notes.

Amit Nigam, executive director and COO at BANKIT, a B2B fintech startup acknowledges the limitations of AI chatbots. “An AI chatbot might not fully understand what a customer is trying to express—something a human can easily grasp. That's why we take a balanced approach—using AI chatbots for speed and accuracy, but ensuring a human touch is there when empathy and understanding are needed,” he concludes

In conclusion, the integration of AI in customer service is both inevitable and necessary. However, as Jain wisely advises, “While efficiency is important, we shouldn’t sacrifice the soul of the customer experience for the sake of speed.” The challenge for brands lies in striking the right balance—one that leverages the strengths of AI without losing the irreplaceable value of human connection.