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Humanized AI: The Secret to Elevating Customer Experience and Maximizing Customer Lifetime Value

Ziv Fass
February 22, 2024

Home furnishing and appliance retailers have excelled in the art of delivering that in-store “wow” experience. But they have consistently struggled to extend that warm, engaging, personalized approach beyond the store to post-purchase last-mile delivery. Evolving customer expectations, however, is forcing furniture retailers to adapt and transform furniture delivery into more than a mere doorstep transaction. 

 

With consumers demanding a more engaged and personalized experience from retailers, home furnishing and appliance brands need to extend the high-level of in-store service and personalization throughout the last mile to guarantee an optimal customer experience. In today’s consumer landscape, this is non-negotiable given that 80% prioritize a positive experience as much as the product itself, according to Salesforce’s State of the Connected Customer Report.

 

This means embracing a personalized, responsive, and interactive strategy for engagement during the last mile is crucial in crafting a compelling experience that aligns with customer expectations. Achieving this consistently and at scale requires a different approach, where retailers deploy a combination of real-time intelligent automated AI-powered conversations with customers, complemented by human support ready to seamlessly engage when needed.

Why Home Furnishing and Appliance Retailers Need a Specialized Approach

Furniture retailers need to deploy AI specifically tailored for their substantial and cumbersome delivery requirements. This can aptly be labeled ‘humanized’ AI, as it hinges on a seamless collaboration between human and machine. The primary goal is to enhance the customer experience, utilizing AI to ensure customers feel valued, acknowledged, and heard consistently, extending beyond the confines of the physical, bricks and mortar store showroom.

 

The outcome is an ongoing, interactive customer engagement that persists throughout the last mile delivery and extends beyond. Customers have the ability to inquire when they require information, engage in direct conversations with the delivery driver, effortlessly reschedule deliveries if necessary, and participate in real-time dialogues with the retailer throughout the entire process when needed. This two-way engagement surpasses the mere act of “delivering products” – it establishes a smooth and personalized experience, placing the customer at the core and in command. Additionally, it serves as a catalyst for customers to share reviews and presents optimal post-purchase upsell and marketing prospects.

 

This profound and extensively engaged last-mile encounter will foster enduring brand loyalty and boost repeat purchases. The consequence is an elevated customer lifetime value, representing the ultimate goal for all retailers. This is no longer a “nice to” for home furnishing and appliance retailers, but a “have to”. 

 

“As the retail environment continues to shift and evolve, leveraging AI has become critical for staying relevant,” Norman Alegria, Director Customer Experience, The Dufresne Group (TDG) commented in Furniture Today’s Humanizing AI webinar. “I mean, you know, we have to meet the dynamic demands of a modern consumer.”

Successfully Implementing AI as a Powerful Tool

There’s a misconception that with AI, everything instantly becomes perfect. However, the reality is different. AI holds the potential to greatly improve the post-purchase customer experience in home furnishings and appliance retail, but it’s crucial to see it as a powerful tool rather than a magical solution.

 

“That’s why a humanized approach with parameters in place is vital,” comments Wes Dudley, VP Customer Experience Broad River Retail, in the Humanizing AI webinar. “Any technology needs to be well vetted and tested before it rolls out. Poorly implemented AI can be useless, it can be a waste of people’s time and actually do major brand damage.”

 

A notable example of AI negatively impacting a retailer made headlines when a customer service chatbot designed for the international delivery service DPD began uttering profanities and openly denouncing the company as the “worst delivery firm in the world.” These unconventional responses, triggered by a frustrated customer’s last-mile experience, underscore the potential pitfalls of AI integration.

 

Integrating AI can lead to transformative enhancements, but its successful implementation demands a strategic and careful approach. When it goes awry, the consequences can be severe.

Getting the Right Balance Between AI and Human Interactions

Many executives in the furniture retail sector view AI as a means to alleviate the financial strain of last-mile delivery by reducing labor costs. However, this approach is misguided. When implemented correctly, businesses can indeed realize savings through AI-driven automation, but it’s imperative to reinvest these savings in team development, customer-centric initiatives, and overall company growth through training programs.

 

Successful AI implementation hinges on effective change management. Concerns among agents and delivery teams about job security can be allayed by illustrating how AI enables a shift towards higher-level tasks and, in fact, contributes to job creation by fostering growth. While financial efficiencies such as cost reductions are beneficial, they should be viewed as ancillary rather than the primary driving force in last-mile delivery.

 

Recognizing the limitations of AI is crucial to preserving the importance of the human touch. Adopting a humanized approach to AI is essential in a people-centric industry. Striking a balance between automated processes and human interactions is key. AI can serve as a potent ally in enhancing the post-purchase customer experience, but it should be integrated as part of a comprehensive strategy that prioritizes customer needs, transparency, and the seamless fusion of technology and human touchpoints.

 

As retail undergoes a transformation into an omnichannel journey, the last-mile experience emerges as the critical juncture for securing brand loyalty and repeat purchases. AI empowers furniture retailers to achieve this by ensuring a personalized, responsive, and interactive customer experience. Happy customers aren’t just one-time buyers; they become devoted fans. Creating positive last-mile experiences transforms short-term transactions into enduring relationships. This approach unlocks the ultimate treasure for furniture retailers: higher customer lifetime value.

 

For practical insights and a deeper exploration of the benefits of AI in last-mile delivery, watch Furniture Today’s webinar, Humanizing AI: The Secret To Elevating Customer Experience.

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