Top 5 AI Customer Service Strategies for Elevated Retail Experiences in 2024

Picture this: a shopper trying on lipstick virtually, visualizing a necklace just below their collar, or examining a handbag across 360 degrees. This is the immersive world of AR-enabled retail, poised to revolutionize the shopping experience. But what happens when that shopper comes with a query or needs personalized guidance? Here's where artificial intelligence (AI) in retail steps in.

market research reveals that the adoption of AI in retail across continents will balloon about 3X from 2024 through 2028.

In today’s fast-paced economy, one truth remains constant: excellent customer service is the cornerstone of a thriving retail business. As a brand owner, you understand the significance of ensuring long-term customer stickiness while delivering shopping experiences driven by augmented reality (AR) in retail. Now, imagine taking your customer service within the AR-enabled setting to a whole new level, making interactions smoother, more immersive, and genuine.

The solution lies in unleashing the power of AI in customer experience.

But how can you ensure your AR strategy isn't just visually stunning but also intelligently supportive? Discover the top 5 AI-powered approaches to elevate your AR experience and turn virtual interactions into loyal customers.

The Current Retail Landscape: A Customer-Centric Challenge

The retail industry stands at a crossroads, with both challenges and opportunities abounding. Decades ago, success in retail primarily depended on a store’s ambiance, the product range, and the staff's politeness. Fast forward to today, and while those factors still matter, the landscape has drastically changed. Now, retail brands are on the battlefield of high customer expectations.

Today, with a whopping 94% of people buying from the same brand offering favorable customer service, retailers clearly can’t afford to settle soon. The digital era has ushered in new channels, expectations, and a heightened need for personalization, lightning-fast service, and unmatched convenience.

This pressing situation has underlined the urgency to incorporate AI in every retail touchpoint, whether online or in-store. Combining that with cutting-edge technologies, including natural language processing (NLP), machine learning (ML), and predictive analytics, retail brands are ticking all those checkboxes. In fact, about half of retailers believe these technologies will shape the industry over the next 3-5 years.

AI in Retail: Time to Look Into the Key Strategies

Chatbots & Voice Assistants For Instant Support

Whenever we think of AI in customer experience, chatbots and voice assistants usually pop into our brains. That's because they're one of the first shopping AI tools to be used to serve shoppers.

Chatbots use ML and NLP to understand and respond to real-time customer inquiries. While virtually trying on an eyeshadow shade or draping a dress, customers can chat with these AI-powered machines to get details on size, materials, care instructions, or even similar product recommendations.

Plus, AI in retail will explain to shoppers how to use AR features and troubleshoot technical difficulties with a more human-like, conversational approach—unlike traditional scripted chatbots. The best part: chatbots perform swiftly and efficiently these tasks without human intervention.

Hence, deploy the retail technology to provide shoppers with hassle-proof, round-the-clock support. That way, they can connect with your brand any time—day or night—and receive real-time assistance, even outside store hours or if your support agents are done for the day.

When launching an AI chatbot, ensure it seamlessly blends into existing customer service databases and CRM systems. Moreover, regularly update and train the customer support AI models with new data chunks and customer interaction scenarios to enhance the chatbot’s performance over time.

Apart from that, you can leverage AI-enabled voice assistants for a hands-free and convenient in-store customer experience. These retail technology solutions enable shoppers to ask questions, search for products, and even complete purchases through voice commands. No need to leave the AR world.

As brands aim to go global, always-on support is critical to maintaining exceptional AR shopping experiences.

But The Human Touch Remains Irreplaceable

Don't replace human customer service agents entirely. Instead, use AI-powered chatbots and voice assistants to handle routine inquiries and basic troubleshooting. Let these retail technologies free up your human agents for complex issues and situations requiring empathy and personalized attention. So, create a fine balance between human expertise and AI in retail.

Make It Personal

Earlier, price and product features drove customer acquisition and sales. While that’s still the situation, personalized customer experience has also emerged as a considerably crucial factor. In fact, nearly half of the customers prefer retail brands that deliver shopping experiences tailored to each individual.

Deploy AI in retail to dig into how shoppers engage with AR features such as virtual try-ons or product placement in real-life settings. This data reveals shoppers’ product preferences, sizing needs, and even style choices. Moreover, customer support AI tools monitor what products shoppers virtually check from all angles, zoom in on, or interact with.

Based on these AR interactions and past behavior, the shopping AI tool suggests complementary items or accessories to customers. For instance, imagine your customers trying on your earrings virtually and seeing AI-enabled recommendations for a necklace that matches them.

For at-scale personalization, have a solid data collection and analysis system at your disposal. Ensure that the data is relevant and up-to-the-minute. Further, be transparent with shoppers about how their data is being used and provide them with options to control their data-sharing preferences.

Go Beyond Reactive Support Using Predictive Analytics

AI-driven predictive analytics pulls out actionable insights from large quantities of data to stay ahead of customer asks and solve potential issues. Here, ML is at the heart of anticipating shopper behavior through AI in retail.

As shoppers virtually try on clothes, the advanced retail technology suggests complementary items based on their style, size, and past purchases. This staves off their need to search further and creates a more cohesive shopping experience. This proactive approach will help you address potential hurdles, provide timely solutions, or even tailor your offerings to meet evolving demands.

For instance, let’s say a customer is struggling with a shirt’s size. Based on body dimensions captured through AR tools, AI in customer experience identifies fit issues and offers suggestions for alternative styles or sizes. Similarly, when a shopper lingers on a specific product, AI triggers a virtual chat or displays relevant information, anticipating their needs and providing instant support.

For optimal predictive customer service, gather and evaluate several data points—from transaction history and customer-facing conversations to social media feedback. The richer the data, the more accurate the predictions. More importantly, abide by data protection regulations to maintain customer trust.

Data-driven Insights for Continuous Improvement

Artificial intelligence in retail tracks how customers interact with virtual elements in your AR app—time spent, items chosen, and customization options. This information reveals preferences, browsing patterns, and areas for improvement. Understand what aspects of your AR experience confuse or frustrate shoppers to optimize features and address usability issues.

Use AI-powered engines to compare multiple iterations of your AR experience and see which ones resonate best with customers. Analyze how customers respond to variations in sizing tools, product visualization, and social sharing options.

Measure the effectiveness of the AR offering through AI-enabled feedback surveys, considering factors like resolution effectiveness, response time, and customer satisfaction. These objective insights are valuable for continuous improvement.

When deploying AI in retail for testing AR-enabled experiences, balance AI-produced insights with human judgment. Use AI to extract data-driven insights but keep the human element in decision-making, especially in complicated situations.

Peek Into Shoppers’ Brains

What’s going on in people’s minds? This has never been an easy thing for brands to figure out.

Emotions are a double-edged sword. They are ultimately what connects shoppers to your retail brand — or shoo them away from it. If you aren’t capturing and examining this data in real-time, you will likely fall behind.  

As customers immerse themselves in AR shopping experiences, AI in retail detects emotional cues at the moment through facial recognition and sentiment analysis of voice notes. Use these inputs to understand how customers react to virtual products, sizing, or the overall AR experience. Measure satisfaction, frustration, or confusion to pinpoint areas needing refinement.

Based on this real-time emotional intelligence, AI-driven retail technology solutions provide tailored product recommendations or support. Case in point, shoppers get alternative product suggestions if they frown while virtually trying on a pair of sunglasses.

We all know how powerful emotions are—when analyzed well, customer emotions can take customer service in retail to new heights. Unfortunately, very few industry players even capture this invaluable data, let alone evaluate it in real-time--don’t be among those laggards.

That’s a Wrap

The wide world of retail is evolving, and brands must welcome it open arms to keep up. By implementing these five customer service artificial intelligence strategies, you’ll unlock a new level of customer satisfaction and engagement. From seamless support within the AR environment to data-driven recommendations and sentiment analysis, AI in retail helps you anticipate customer needs, address concerns proactively, and, ultimately, build long-lasting customer relationships.

That being said, some retailers might turn to AI-powered in-store retail technologies in times of high inflation and tight economics only to cut costs and boost efficiency. While AI promises to bend the cost curve in several retail sectors, brands that keep customers at the center will realize the greatest value.

As you fine-tune your augmented reality in retail experiences with AI's help, you'll be well stationed to outshine the competition and deliver a truly immersive shopping journey for customers.