Great customer service keeps people coming back. But too often, long wait times, generic responses, and unresolved issues push them away. 65% of consumers switch brands due to poor service, costing businesses billions every year.
Traditional chatbots were meant to help, but they often miss the mark. However, owing to the evolving complexity and the volume of customer enquiries, they struggle with context, can’t handle complex questions, and often frustrate customers.
In this scenario, customer service AI agents offer a better way.
Unlike basic chatbots, they understand intent, remember past interactions, and provide helpful answers instantly.
The result?
Faster responses, lower costs, and happier customers.
If you’re looking to improve your support without sacrificing quality, AI agents might be the answer.
Let’s take a closer look at how they work.
What is a customer service AI agent?
Customer service AI agents, particularly those utilizing agentic AI, represent a significant advancement in artificial intelligence. Unlike generative AI, which focuses on creating new content, agentic AI is designed to autonomously understand, plan, and execute specific tasks without human intervention.
So, they understand context, intent, and even tone, making their responses more accurate and human-like.
How customer service AI agents work
AI agents work in a systematic manner that includes the following steps:
1. Perception and data collection
Customer service AI agents gather information from customer interactions, purchase history, and social media. This helps them understand customer needs. Advanced AI processes data in real time to provide accurate responses.
2. Decision making
AI analyzes patterns using deep learning. It selects the best response based on past interactions and the current context. Over time, it improves by learning from previous experiences.
3. Action execution
Based on its assessment, the AI responds, processes, or escalates to human agents, delivering fast and relevant customer support.
4. Learning and adaptation
Lastly, AI refines its responses with each interaction. It updates its knowledge base and adapts to customer needs. This helps businesses stay responsive and efficient.
Key benefits of customer service AI agents
About half of the customers in a Salesforce survey are comfortable with AI improving product quality and delivering better service.
Let’s have a closer look at some of its benefits:
24/7 availability and instant response
Customers expect support anytime, whether early morning or late at night. AI agents ensure your business is always accessible, providing instant, timely responses. Unlike human teams, they don’t need breaks or shifts, making round-the-clock support effortless.
Faster resolutions, happier customers
Long wait times can frustrate customers and lead to unsatisfactory interactions. Customer service AI agents process queries instantly, reducing response times and improving satisfaction.
Whether answering FAQs or troubleshooting simple issues, they help customers get solutions without waiting.
Handles high query volumes efficiently
During peak hours or seasonal spikes, customer service teams struggle with high volumes. AI agents can handle thousands of queries at once and reduce wait times.
Data-driven personalization
AI agents analyze past interactions, preferences, and behaviors to tailor responses. For example, if a returning customer inquires about an order, the AI can retrieve details instantly, providing a smooth experience.
Reduces workload for human agents
Repetitive questions like order status or refund policies can take up a lot of time. AI agents handle these, freeing human agents to focus on issues that need empathy or expertise.
This improves efficiency and prevents burnout in your customer service team.
Human-like conversations with context retention
Basic chatbots often give generic answers, forcing customers to repeat themselves. AI agents remember past conversations, understand context, and provide relevant responses. This makes interactions feel natural and seamless.
How are customer service AI agents different from chatbots
AI agents are the latest innovation in automated customer service, while chatbots have been around for quite a while. Let’s look at how they compare:
Use cases of customer service AI agents in ecommerce
A Salesforce study highlights the perceived “blistering pace” of AI advancement. Nearly half of customers expect AI to match human cognitive abilities within the next decade, and almost a quarter predict this by 2029.
With AI agents performing many cognitive tasks, such as logical reasoning and decision-making, we can only expect them to become more sophisticated.
Here is how ecommerce businesses are currently using AI agents to amplify their potential in customer service:
Automated order management
Amazon, one of the largest e-commerce platforms globally, handles millions of customer transactions daily with AI agents. Its customer service AI agent helps customers check order status and estimated delivery times. Here’s how:
- Order status tracking: Customers can use Amazon’s AI assistant via the “Your Orders” section on the website or app. The AI agent provides real-time updates on order status, such as whether the item is shipped, in transit, or delivered.
It can also clarify issues like delayed shipments or missing items by accessing detailed shipping data.
- Estimated delivery times: The AI assistant provides accurate delivery estimates based on factors like shipping method, location, and current logistics conditions.
Personalized shopping assistance
According to 2023 Salesforce research, 81% of consumers can rethink their budgets to get more personalized experiences. This data is enough to push big brands like Sephora to invest in AI agents for hyper-personalization.
Sephora’s virtual artist uses AI-driven insights to suggest beauty products tailored to individual users. This is how it works:
- Virtual try-on: The app uses augmented reality and facial recognition technology to allow users to virtually try on makeup products like lipstick, eyeshadow, and cheek colors.
- AI-powered product recommendations: With ModiFace’s AI technology, Sephora analyzes uploaded photos or live camera feeds. It detects facial attributes and matches shades to suggest compatible products from its inventory.
For example, users can upload a photo or select a color from an image, and the AI engine identifies matching lipsticks, eyeshadows, or blushes available for purchase. - Shopping integration: After trying on products virtually, users can instantly add them to their shopping basket within the app for seamless purchasing.
24/7 customer support
H&M’s chatbot is available 24/7 to help customers pick their favorite outfits. Whenever a customer has any doubts about their size or style, the chatbot steps up to help. It analyzes customer preferences and measurements to recommend sizes based on past purchases or general sizing charts.
Their virtual stylist gives perfect suggestions by asking customers about their preferred styles, favorite styles, or occasions they are shopping for. It also provides real-time information on product availability when customers inquire about specific items.
AI-powered returns & refunds processing
Zappos, known for its outstanding customer service, utilizes AI chatbots to handle a wide range of customer queries, including returns and refund processing. It guides the customer through a step-by-step process for a seamless experience.
The AI agent directs customers to sign in to their Zappos account and navigate to “view orders/return items.” Users can select the items they wish to return and choose their preferred return label or carrier.
The brand also uses AI to automate the creation of pre-paid return labels or QR codes, which can be printed or used digitally for drop-off.
Customers can use the chatbot to check the refund status post-return, which typically takes up to 30 days for inspection and processing.
Abandoned cart recovery
Another popular e-commerce platform, Shopify, uses AI agents to simplify customer service. It impressively leverages AI chatbots to send personalized emails or SMS to recover lost sales.
The AI identifies customers who leave items in their cart without completing the purchase. It then automatically sends personalized follow-up messages to remind them of the items, often including exclusive discounts or limited-time offers to encourage checkout.
The chatbots can also analyze customer browsing behavior, purchase history, and preferences to create personalized recommendations or tailored messages.
Fraud detection & prevention
AI has upgraded the customer service landscape. But on the flip side, its rapid rise is fuelling a fraud surge in e-commerce globally, exceeding US$48 billion in losses in 2023.
To tackle this, PayPal uses sophisticated AI agents to flag unauthorized transactions and assign risk scores to each transaction to identify suspicious activity. If any unusual activity is detected in accounts or merchant sites, it notifies users immediately to prevent costly transactions.
Voice-activated shopping assistance
Walmart uses AI agents to make shopping a breeze. Customers tell Google to place their order, and the Google Assistant will add items directly to their cart. The technology looks through prior purchases to ensure the appropriate items are added to the shopping cart.
For example, if a customer asks Google Assistant to add milk to the cart, it will add the one the customer has purchased.
This makes the process so much easier, as customers don’t have to name the product brand or type; just saying the word ‘milk’ is enough. It also works well on iOS, including iPhone, iPad, and Apple Watch. Customers simply need to pair their accounts, and they are good to go.
Offer hyper-personalized customer support with Plivo CX’s AI agents
Plivo CX is an omnichannel customer service platform that leverages AI to help businesses deliver smooth and seamless customer service. It delivers fast, accurate responses, ensuring customers always get the help they need.
With continuous learning and seamless integrations, it improves efficiency while staying true to your brand’s voice.
Here’s how Plivo CX’s AI agents can help you:
- 24/7 support: Provides round-the-clock assistance without downtime
- Smart integrations: Connects with CRM, billing, and support systems for precise answers
- Open AI-powered agents: Manages sales, retention, and customer engagement with specialized AI
- Conversational AI: Uses verified company data to provide clear and reliable responses via a self-service chatbot that is developed by OpenAI
- Omnichannel support: Engages customers via voice, WhatsApp, chat, and more
- Sales & engagement boost: Sends AI-driven cart reminders, offers, and proactive messages
- Real-time insights: Monitors resolution rates, pain points, and customer satisfaction
- Enterprise-grade security – Ensures GDPR compliance, bank-level security, and 99.99% uptime
Start building better customer experiences with AI. Book a demo today.
