Striking a balance between AI adoption in customer experience and the need for the ‘human touch’

The rapid rise of technological advancements, such as AI, has proven to be transformative for different industries, including the consumer and retail sectors. But as the business landscape continues to evolve, businesses will not only need to stay at the forefront of technological trends to be competitive, but must also ensure that they keep pace with customer needs. Delivering on personalisation and demonstrating empathy through the customer experience will be the key differentiators going forward. 

Offering valuable insights is Guillaume Sachet, an advisory partner at professional services firm KPMG in Singapore. With more than 25 years of experience in the technology, government and financial services sectors, he has developed deep digital and customer experience expertise across the Asia Pacific region. Currently, he leads KPMG in Singapore’s Customer Practice.

Prior to his role at KPMG, he has held leadership positions at multinational corporations, where he spearheaded strategies for digital transformation and innovation for clients across Southeast Asia. Sachet has written multiple thought leadership articles and whitepapers on tech and innovation for various organisations and publications and is also a regular keynote speaker. 

As a judge at the Asian Experience Awards 2024, Sachet discussed the benefits of leveraging technology and AI tools to gain deep insights into customer pain points, emotions, and needs, while highlighting the importance for these to be used as complement to human interactions rather than as a replacement.

Customer experience trends in the region are evolving rapidly, especially with robust post-pandemic recovery in recent times. Whilst opportunities are aplenty, businesses are also having to contend with the more volatile global economy, with challenges such as inflation, higher cost-of-living, and supply-chain related instabilities. KPMG’s recent report on ‘Navigating the future of seamless commerce in Asia Pacific’, found that the Asia Pacific region has been at the forefront of retail transformation as compared to the rest of the world, especially with its early and extensive adoption of online platforms.  

Retailers are also embracing artificial intelligence (AI) at unprecedented speed, leveraging its potential to create more personalised customer experiences. The report, which surveyed 7,000 respondents across 14 markets in the region, noted high levels of satisfaction with AI-based product recommendations. Other common uses of AI applications, beyond customer-facing touchpoints, include demand forecasting, supply chain management, and the development of marketing content. As a result of this, nearly every company interviewed for the report has noted that it is either actively exploring or implementing AI in various areas of its operations. 

Underpinning this desire for AI solutions and transformation is the deliberate shift towards seamless commerce strategies, which focus on the brand’s integrated customer journey across multiple platforms and services. These could include customer interactions with the brand on social media, apps, websites, automated messaging, and other digital innovations. However, in their haste to keep up with the trends, businesses are also facing a delicate conundrum – how can they stay at the forefront of technology whilst meeting the needs of businesses and consumers for empathy and the ‘human touch’? It will be important to recognise that forging meaningful connections with customers and adding a personal touch to the brand will also be a key differentiator. Businesses with a nuanced understanding of the trends and their customer needs will be able to strike the right balance needed to achieve success in a complex market.

Digital transformation and data go hand-in-hand. As organisations move towards tapping technology to integrate and analyse data across their teams, it will be critical to also ensure that steps are taken to protect the security and sanctity of the information. Whilst customers today may be more liberal about sharing their data online with businesses in exchange for more personalised experiences, there are still strong concerns about data privacy, which have also been exacerbated by the rise of generative AI. Organisations thus need to be equipped to address the complexities and risks around AI clearly and responsibly and be able to uphold ethical standards when it comes to AI adoption. For instance, KPMG’s global report on Trust in Artificial Intelligence found that people expect organisations to deploy AI systems that uphold high standards to data privacy, security, and governance. 

At the same time, it is important to not let the fear of emerging technology take away from AI’s vast potential to improve efficiency and transform the overall customer experience. Often, organisations are sitting on a wealth of data, which is where AI algorithms can be tapped to provide in-depth analyses and insights quickly and accurately. AI systems can also learn from past interactions and customer feedback to improve their problem-solving abilities over time. 

Given the focus on data-driven strategies, organisations need to ensure that they are implementing AI responsibly and thoughtfully, with a focus on transparency, data privacy and ethical use. By demonstrating this, they will be able to positively impact customer trust. Ultimately, organisations that can demonstrate their commitment to customer well-being and empowerment through AI technologies are more likely to build long-term trust and loyalty.

As businesses strive to enhance their customer experience strategies amidst a competitive landscape, they would do well to keep KPMG’s Six Pillars of Customer Experience Excellence in mind, as these often form the basis for which customers evaluate their interaction with brands: integrity, resolution, expectations, time & effort, personalisation, and empathy. Whilst each pillar is crucial, leading companies often excel when they are able to deliver customer experiences that cut across a combination of all six. However, the first four pillars should almost be seen as hygiene factors, and the emphasis going forward should be on the last two pillars of personalisation and empathy in order for businesses to truly differentiate themselves. 

Companies or brands that are able to demonstrate personalisation do more than just tailoring their content or products to customer needs. They are able to create a deep connection with customers, allowing them to feel valued, important and unique. Through their delivery, they are also able to empower their customers to be in control and better educated to make the right choices that suit them the best. This is where AI can play a role in augmenting personalisation strategies. For example, AI technologies can be used to analyse customer data and behaviour patterns in real-time so that the right information can be delivered to the customer at the time of need. AI can also be leveraged to offer these products and services on the customer’s platform of choice, based on their location or browsing behaviour.  

On top of this, there is a greater need to also build meaningful relationships with customers and to be able to foster understanding and emotional intelligence. This is where empathy comes into play, and companies that are able to strike a balance between AI-driven automation and maintaining a human touch will find success. Through this, they are able to create compassionate experiences and drive deep rapport. Technology and AI tools can still prove to be beneficial in empowering employees with insights into customer pain points, emotions, and needs, but these must be used as complement to human interactions rather than as a replacement.

Often, the most successful organisations are the ones that invest in building a connected enterprise for greater impact. This means having a customer-centric, tailored-by-sector approach to digital transformation, where the strategies, operations, and technology development are all aligned towards achieving the same objectives. 

The Six Pillars of Customer Experience Excellence hence also need to be extended to the employee experience, as empowered employees are a critical force in delivering on customer expectations. Businesses can leverage these six pillars to build engaging employee interactions, foster an innovative culture, and strengthen their business proposition. 

For instance, personalisation could mean designing a competitive capability framework and customised training programmes to provide employees with the skillsets and agility to adapt to changing business needs.

Expectations around generative AI are rising, and brands able to tap its transformative potential whilst skillfully managing the risks will be the ones that reap the greatest benefits. Striking a good balance between these two fronts will enable brands to drive greater hyper-personalisation of customer experiences, more seamless interactions, and enhanced productivity in a “human-like” manner whilst doing so in a trustworthy and ethical manner.

Satisfaction levels from customers and employees would be one of the yardsticks for measuring impact and success today. However, at the heart of this would be the ability to demonstrate empathy. Even with advancements in AI and emerging technologies, the human touch should not be underestimated, and brands that are able to build valuable connections with their customers are more likely to differentiate themselves from their competitors.