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Contact Center as a Service Gains AI Benefits

Enterprise leaders with large customer care organizations are exploring Artificial Intelligence (AI) applications to improve their online customer experience, increase operational efficiency, and reduce costs to improve profitability.

Trained AI can be used to automate tasks, such as answering routine questions, freeing up contact center agents to focus on more complex inquiries. AI can also be applied to personalize the customer experience by recommending new offerings.

Additionally, AI can be deployed to analyze vast amounts of existing customer data to identify support trends and patterns, which can be used to improve the overall customer experience.

Customer Care AI Market Development

Worldwide Contact Center (CC) and Conversational AI, including virtual assistant end-user spending is projected to total $18.6 billion in 2023 -- that's an increase of 16.2 percent from 2022, according to the latest market study by Gartner.

"Near-term investment growth rates for CC and CC Conversational AI and Virtual Assistants are expected to dip as business volatility creates a lengthening of decision cycles," said Megan Marek Fernandez, director analyst at Gartner.

Longer-term, Generative AI and growing maturity of Conversational AI will accelerate contact center platform replacement as customer experience leaders look to simultaneously improve the efficiency of customer care operations.

The global Conversational AI and Virtual Assistant market represents the fastest-growing segment in the contact center forecast -- helping to spur 24 percent growth in 2024.

Conversational AI capabilities are receiving greater investment as contact center decision makers look to incorporate artificial intelligence as part of a long-term strategy to reduce reliance on live agents.

While the number of customer care interactions that are touched by AI continues to increase, most of these interactions are augmented with CC AI instead of fully offloaded to a Virtual Agent.

Overall, according to their latest forecast, Gartner estimates around 3 percent of interactions will be handled via CC AI in 2023, growing to 14 percent of interactions in 2027.

Gartner expects general economic and geopolitical uncertainty to create some IT budget restrictions in 2023, resulting in a slowdown of premises-based contact center replacements and upgrade projects.

However, customer-facing projects may be viewed as an important part of revenue retention and generation strategies. Therefore, this IT investment may be strategic for some CEOs.

While many IT investments will be constrained as budgets tighten, customer service and support initiatives that have the potential to differentiate the customer experience could be prioritized.

These factors will help Contact Center as a Service (CCaaS) projects receive funding associated with broader corporate digital transformation budgets.

Outlook for Customer Care AI Apps Growth

Gartner expects CCaaS investment growth to accelerate as decision makers implement cloud-based contact center capabilities to modernize their operations. This includes adoption among contact centers with many thousands of agents, which have been slow to apply CCaaS.

According to the Gartner assessment, CCaaS solutions will be implemented to support a broader mix of communications channels and will feature advanced dashboards, data analytics, routing, workforce optimization, workflow insight, and some AI capabilities.

That said, I believe various forms of virtual assistants -- such as website chatbots -- can process simple customer care issues 24/7. This can enable human agents to focus on higher value activities that they are uniquely qualified to resolve.

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