Automated Customer Service Could Crush Your Business

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automated customer service

Automated customer service has many customer experience (CX) professionals giddy with delight. That’s because advances in artificial intelligence (AI) and generative text — think ChatGPT — mean that bots may soon be able to handle many customer support conversations.

However, just because we can, doesn’t mean we should.

There are subtle signs as to why ChatGPT and using automated customer service may crush your business. In this article, we’ll explore the potential downsides of automated customer service and provide tips on how to avoid common pitfalls.

What Is Automated Customer Service?

In today’s fast-paced world, automation has become a significant part of the customer service industry. With the rise of chatbots, automated emails, and self-help knowledge bases, companies are moving away from traditional customer service methods.

Over the years, customer service has evolved, and companies have adopted new technologies to provide better service. One such technology is automated customer service. Essentially, automated customer service is any service in which your customer can solve their problem without a human.

With automated customer service, businesses can provide 24/7 support to their customers without the need for human interaction. Sounds great, right?

This has allowed companies to …

  • Reduce their costs
  • Increase efficiency, and
  • Provide faster response times

However, automated customer service is not always the best solution for every business.

Look To Facebook For Clues

One major ripple I saw in the customer service automation space was Facebook and Kustomer. Initially, Facebook bought Kustomer for one billion (yes, with a B!) dollars to improve their customer service tools.

From the TechCrunch article announcing the deal:

… Kustomer and other CRM companies … describe what they do is “omni-channel” customer relations. That is to say, it gives the Kustomer business users a complete picture of the many disparate places where “conversations” might be happening with customers — be it on apps, on social media, in websites, via chatbots, or email, etc. The logic is that this makes the agent more efficient and gives him/her a better picture of both how the business is faring across those channels, and more context about a specific user contacting the company from one of those channels, as well as a more complete picture of the customers themselves.

Exciting, right? Coincidentally, or not, that same month Snap acquired, which makes customer support voice bots.

But, the story doesn’t end there.

Fast forward to early March of this year (2023) and Meta is planning to divest Kustomer as it looks to refocus on its core business, citing the company and people familiar with the planned deal.

A quote from one source said, in part:

Facebook shut down its AI system while it was still in development. Although the company had already generated the bots necessary to produce an AI system, there were increasing concerns from Facebook’s AI teams over how those bots were communicating.

If Facebook spent a billion dollars to just shut something down, I don’t think I have to tell you anything else about the risks of automated customer service.

But of course, I will. 😉

The Problem(s) With Automated Customer Service

There are several potential downsides to automated customer service that you need to be aware of.

1) Lack of Personalization

Automated customer service can lack the personal touch that customers crave. Many customers want to talk to a real person who can empathize with their problem and provide them with a personalized solution. Automated solutions can make customers feel like they are just another number and that their problem is not important. [Read our human scripts for aligning with empathy]

2) Inability to Handle Complex Issues

Automated customer service solutions are great for handling simple queries and complaints, like FAQs. However, they often struggle to handle more complex issues that require a human touch.

automated customer service chatbot fail

3) Risk of Technical Issues

Obviously, automated solutions rely on technology, which can sometimes fail. If your automated customer service solution goes down, your customers will be left without support, which can be a disaster for your business.

4) Alienating Customers

If customers feel that they are not being heard or that their problems are not being addressed, they may become alienated and look for other businesses to provide them with the support they need. This can lead to a loss of customers and a decline in in CX. Or worse, revenue.

5) Reduced Customer Loyalty

Customers who have negative experiences with automated systems are more likely to switch to a competitor who offers a more personalized experience. 80% of customers said they have switched brands because of poor customer experience. Eek!

From personal experience, the customer care clients we serve do not use any automated solutions for their customer service program. The reason being is that their customers expect a human to help them and their issues tend to be more complex.

How To Avoid Losing Customers

Look, I get the allure of using bots to handle the influx of customer support issues. Really, I do!

So, if you insist on going that route, here are my best tips for doing it the right way.

  1. Balance Automation with Human Interaction. As noted, automated customer service solutions should be used to handle simple queries and complaints, but businesses should also provide a way for customers to speak to a real person if they have more complex issues. Providing customers with the option to speak to a human can help them feel heard and valued.
  2. Provide Personalized Solutions. Automated solutions should be designed to provide personalized solutions. This can be achieved by gathering customer data such as purchase history and using it to provide tailored solutions, or what we call “situational personalization” — which customers LOVE.
  3. Test! Before implementing an automated AI solution, it’s important to test it thoroughly. Testing can help identify any technical issues and ensure your solution is able to handle a variety of customer queries and complaints.
  4. Monitor Customer Feedback. Monitoring customer feedback can help you identify any issues with your automated customer service solution. If customers are consistently complaining about the same issue, it may be time to reassess how you’re approaching customer care and make necessary changes.
  5. Continuously Improve. Any/all of your customer support solutions should be continuously improved to ensure that they are meeting the needs of your customers. This can be achieved by gathering customer feedback and using it to make necessary changes.

Finally, my last tip is to consider using a tool like social listening to help you with customer care and acquiring new customers through digital channels. This is where I think AI can be used most intelligently.

Soapbox Moment: Personalization

One of the biggest reasons I think automated solutions fall short for digital customer care is personalization. Personalization in digital customer service is not just important – it’s critical.

In today’s competitive marketplace, companies are constantly looking for ways to stand out and provide a superior customer experience. And one of the most effective ways to do this is by personalizing your interactions with your customers.

When customers feel like they are being treated as individuals, rather than just another number in a database or in a chatbot queue, they are more likely to feel valued and appreciated. This, in turn, can lead to increased loyalty and repeat business. In fact, studies have shown that customers are willing to pay more for a personalized experience.

Ultimately, personalization in digital customer service is about creating a relationship with your customers. By treating them as individuals and catering to their unique needs and preferences, you can build trust and loyalty that will keep them coming back for more.

Use Automated Customer Service At Your Own Risk

Finally, automated customer service has been around for quite some time, and it’s not going away anytime soon.

In fact, according to a study conducted by Chatbots Journal, during 2021, more than 50% of enterprises spent more on bots and chatbot creation than traditional mobile app development.

automated customer service conversational AI


However, the question remains, is this technology the right solution for every business? The short answer is no. While automated customer service may work for some businesses, it could be detrimental to others.

Automation has its benefits. Nevertheless, businesses need to be careful about how they implement automated customer service solutions. Poorly implemented automated can hurt your business by alienating your customers, damaging your reputation, and ultimately reducing your profits.

Balancing Automation and Personalization

In conclusion, automated customer service can be a double-edged sword for businesses.

While it may seem like a smart move to cut costs and improve efficiency — something we’re all keen to do this year — it can actually lead to reduced customer loyalty and damage to your brand’s reputation. Automated systems can be useful for handling simple tasks and reducing wait times, but it’s important to have a human representative available for more complex issues. This ensures that customers receive the level of personalization and empathy that they desire.

By striking a balance between automation and personalization, testing your systems regularly, and listening to customer feedback, you can avoid the pitfalls of automated solutions and provide a positive experience for your customers.

FAQs for Automated Customer Service

  1. What is Automated Customer Service? Automated Customer Service refers to the use of technology, such as chatbots, AI-driven response systems, and automated phone systems, to handle customer queries, complaints, and other interactions without human intervention.
  2. How can Automated Customer Service negatively impact a business? While automation can streamline processes and reduce costs, over-reliance or poor implementation can lead to impersonal interactions, misunderstandings, and frustrated customers. Ultimately, cases where personal touch, empathy, or complex problem-solving is required, automated systems might fall short.
  3. Are there benefits to using Automated Customer Service? Yes, when used appropriately, it can offer 24/7 support, handle high volumes of routine queries efficiently, and free up human agents to deal with more complex issues. The key is finding the right balance between automation and human touch.
  4. How can businesses ensure their Automated Customer Service doesn’t harm their reputation? First, businesses should regularly assess and test their automated systems for user-friendliness, and ensure there’s always an option for customers to reach a human agent. Additionally, they need to gather regular feedback on the automated service experience to make continuous improvements.
  5. What are some signs that a business’s Automated Customer Service might be doing more harm than good? Most importantly, look for an increase in customer complaints. Then, look at indicators such as high dropout rates from automated systems, negative feedback on social media or review sites, or a decline in customer satisfaction scores.
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Brooke B. Sellas is an award-winning Customer Marketing Strategist and the CEO & Founder of B Squared Media. Her book, Conversations That Connect has been recognized nationally and is required reading for a Customer Experience class at NSU. Brooke's influence in digital marketing is not just about her accomplishments but also about her unwavering commitment to elevating the industry standard of digital customer experience and customer marketing.
Conversations That Connect
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Category: Customer Care, Customer Service
Tags: AI, artificial intelligence, automated customer service, automated customer service solutions, automation, B Squared Media, Brooke B. Sellas, Brooke Sellas, chatbots, customer care, customer care strategy, customer loyalty, customer service, customer service chatbots, , Kustomer, Personalization, support voice bots
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