Retailers warned: Don’t rely on AI to deliver customer service
Recent advancements in generative AI support productivity and streamline business processes. However, experts warn against relying too heavily on technology for customer service.
Emotional intelligence, they argue, remains irreplaceable when it comes to delivering meaningful customer experiences.
Richard Valente, EVP of Business Solutions at TP, a customer support company, addressed the limitations of AI in the customer experience space.
When asked whether AI could replace human staff, his response was clear: “No.”
“AI enhances efficiency and helps meet customer needs, but it can never replicate the emotional intelligence (EI) that fuels trust, connection, and loyalty,” Valente explained.
He highlighted that AI has been used in customer service for years to handle routine tasks like answering FAQs, providing order updates, and offering basic support.
“AI tools like chatbots and automated responses are great for high-volume inquiries and are available 24/7, which makes them incredibly useful for businesses,” he said.
Valente pointed to examples of AI in action, such as central banks using virtual assistants for basic inquiries and Australian retailers deploying AI-driven chatbots to track orders and returns. But he was quick to emphasise the limits of AI.
“What it can’t do is replicate emotional intelligence. Humans have empathy and creativity, which are critical for addressing sensitive or highly personalised customer requests,” he added.
He cited a recent example involving Australian retailer Country Road. A chatbot had suggested a refund or credit to a long-term customer whose special occasion outfit hadn’t arrived on time.
When a human agent stepped in, they recognised the emotional weight of the situation and arranged for express delivery and a discount as a goodwill gesture – an empathetic response that secured the customer’s loyalty.
Valente shared actionable advice for retailers on how to balance AI and human interaction:
- Personalised responses: Address customers by name to demonstrate care and attention.
- Walk in the customer’s shoes: Test customer service processes to understand the client experience.
- Cultural sensitivity: While AI may misinterpret nuances, human agents can adapt naturally.
- Strategic AI use: Deploy AI for routine tasks and free up human agents for more complex, emotionally charged interactions.
- Timely engagement: Ensure short wait times to make customers feel valued.
“AI plays an important role in improving efficiency, but it works best as a complement to human agents—not a replacement,” Valente concluded.
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