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Customer Service

AI Customer Service: All You Need to Know [+Examples]

by Maryia Fokina·Updated
AI customer service cover

Artificial intelligence is probably the biggest buzzword of recent years. And no wonder, since its impact on our life and work has been immense.

There is one area of business that can benefit from AI particularly well—customer support. 

AI customer service has the power to improve user experience, scale businesses, optimize the workload of support teams, and cut business costs. 


How to get started with AI customer service? How to use its potential to the fullest? What are the best tools?

This article is the only guide you need to explore AI-powered customer service. 

Let’s get straight to it!

In this article:

Supercharge your customer service with Lyro by Tidio

Learn more about AI chatbots

Interested in learning more about offering stellar customer service? Check out these pieces:

Starting from the basics—

What is AI customer service?

AI customer service is the use of tools powered by artificial intelligence to automate support and provide more efficient assistance to buyers.

There’s a variety of AI software that can help businesses from any industry partially or fully automate the customer communication tasks. These include responding to customer inquiries, welcoming new customers, recovering abandoned carts, answering FAQs, and more. 

ai response bot graphic

Because of its multiple benefits, AI customer service has become the focal point of many companies looking for innovation and growth. And no wonder—when done right, AI can dramatically improve customer support efforts, retention, and user satisfaction. In fact, according to statistics, customer satisfaction is expected to grow by 25% in 2023 in organizations that use AI.

Of course, improvement, growth, and innovation are big words. How exactly AI customer service is changing the business landscape and the world of communication between a brand and its shoppers?

We’ve got all the details, so read on to find out. 

How AI can improve customer service

It can be easy to get lost in all things AI can do. It’s even easier to get confused about all things this technology can do for your business in particular. However, once you’ve connected the dots, the benefits are extremely tempting. 

Here are some of the most important ones:

1. AI makes customer support workflows more efficient

Artificial intelligence for customer service is getting more and more advanced. There are plenty of advanced tools, and many systems are also able to learn from each conversation they have with visitors.

AI solutions become virtual shopping assistants working together with human support agents for one purpose—leaving customers happy and satisfied with their shopping experience. By combining human intelligence with the efficiency and self-learning capabilities of AI, support workflows are streamlined. It allows for a better structure and, ultimately, better customer experience with shorter wait times.

Read more: Check out the latest AI customer service statistics for more insights into the power of AI for customer experience and business growth.

2. AI customer support is available round the clock and in multiple languages

No matter how efficient and productive your support team is, they are not superhumans. People need to rest and they take time to learn new things. Here, artificial intelligence technology comes in handy.

Customer service AI tools are on the clock 24/7, always and everywhere. They also speak multiple languages, which is helpful for international companies and those that are growing. You won’t need to worry about the language barriers with your shoppers anymore as your tools will have it covered. Using call center AI solutions can enhance the efficiency of call centers by automating interactions with customers.

It’s also truly great news for your customers. No matter when, where, and how urgently they require assistance, they will get it quickly and efficiently. Such speed combined with the competence of your human support team can help turn your website visitors into your loyal customers.

3. AI customer support gathers and analyzes data for better user insights

The amount of data AI can gather and analyze is truly impressive. AI customer support tools simplify collecting big chunks of information to establish customer behavioral patterns, get a single customer view, and work towards hyper-personalization. 

Back in the day, businesses had to feed data to AI manually. Of course, it made data analysis more efficient, however, it was still time-consuming and tedious. Modern day AI customer service tools are self-sufficient in learning from their customer interactions. They easily analyze customer data and patterns and start acting on their insights.

customer intents with percentage on image

Implementing AI-gathered insights and personalizing experience is crucial. This way, customers get information that is relevant to them and feel that the brand’s communication is specifically tailored to them. 

Read more: Find out how to incorporate AI to your business operations with an NLP chatbot.

4. AI customer service drastically cuts your support costs

The truth is, hiring dozens of support agents is a thousand times more expensive than implementing an AI customer service tool. So, not only do AI solutions bring a lot of money to your business, they also save plenty of expenses. 

Often, AI tools don’t require big initial investment to install the software on your website. They have freemium versions to play with, allow you to only get the customized features that you need, and come with pre-designed conversation flows and templates. This drastically reduces your support costs and allows you to do much more for much less.

According to our statistics, AI improves productivity of more than 80% of employees. And all this at a fraction of the costs of additional hiring and training human agents.

Read more: Check out this case study by Tidio on how support automation helped a fashion ecommerce increase conversions by 50%.

5. AI boosts customer satisfaction like no human could

All the benefits come down to the most important one—chatbots for customer service have the power to boost customer satisfaction like never before. 

Personalization, short response times, efficiency, and relevance of customer communication can reach an all-time high with artificial intelligence tools. Modern-day customers are picky and demanding, with as many as 79% claiming they wouldn’t complete their order if customer service was unresponsive. 

However, AI customer service tools know a way to win them over by turning first-time visitors into paying customers who stay loyal to the brand and keep returning. In fact, as many as 57% of businesses are already using AI to improve their customer service. Customer satisfaction is everything when it comes to the ultimate business goals—increasing revenue and growing.

As we went through the benefits, it’s time to move on to practical stuff.

How can you merge customer service and AI in your business? What are your options? And how do you make the most of them?

Let’s find out.

Want to boost customer engagement and satisfaction with AI?

Learn more about AI chatbots

How to use AI in customer service

AI customer service comes in many shapes and forms. Each of them can improve your support processes and help you excel at your communication with visitors. 

Here are some examples of AI in customer service you should consider when looking to offer stellar support.

1. AI customer service chatbots

When thinking about AI customer service, chatbots are usually the first thing that comes to mind. And no wonder, since AI chatbots have proved time and time again how powerful they are. And now, chatbots use machine learning and natural language processing to provide exceptional customer service and assist visitors whenever needed.

How do chatbots work so well?

Essentially, they are designed to quickly recognize common speech patterns and triggers to provide relevant resources based on the knowledge sets they are fed. You can design conversation flows for your bots, use ready-made templates, or choose LLM-powered bots that learn from each user interaction they have.

The good news is that many chatbots do not require any coding skills to set up. The steps you need to take involve choosing the channels and the chatbot provider, designing the conversation flows, and pre-testing the chatbot. 

Of course, as you go, you need to collect feedback, analyze your tool’s performance, and continuously improve it.

Saying that every business needs a chatbot is not an overstatement. From huge names like Sephora, Starbucks, and Spotify to smaller local businesses and 1-person companies—everyone can benefit from exceptional customer service automation

regalrose tidio widget

Read more: Learn everything about how to create a chatbot for your website in our dedicated article.

2. AI for omnichannel customer service

AI customer service can become a great addition to your omnichannel support strategy. Essentially, omnichannel is a user engagement and lead generation approach. It ensures the company is present and gives access to all its products, offers, and support services on every channel, device, and platform. It’s worth considering—especially since studies show that omnichannel approach results in almost 10% annual revenue growth for businesses.

How does AI fit here? Actually, perfectly.

Seamless AI customer service can positively impact your omnichannel strategy by directing shoppers to the right support channels. For example, if the case is twisted and complex, AI can direct customers to a live chat agent or phone assistant who can help quickly resolve it. AI can also offer to chat on Instagram, Messenger, or WhatsApp for quicker communication if the customer prefers that.

example of hubspot user panel

One of the well-known examples of AI omnichannel support is Uber. Apart from the mobile app with chatbots, it offers email and social media automated support, real-time updates, local support centers, and a dedicated platform “Uber for business” for corporate clients. 

3. AI customer service for sentiment analysis

That’s where it gets even more interesting. Sentiment analysis is a type of NLP (natural language processing) that uses AI to recognize the sentiment and emotional tone expressed in text. 

AI tools answering customer requests with their sentiment in mind prevents the feeling of “chatting with a robot”. It helps users experience talking to an advanced AI solution that conveys the brand’s voice, values, and respect for clients. 

ai phrase matcher vs visitor perspective

Apart from scraping customer requests and questions to support, AI-powered sentiment analysis tools can also help with social listening. They also monitor brand reputation, catch feedback comments on social media, and gather insights for product improvement. 

This is important, since every day, around 1.145 trillion MB of data is generated on social media. Users write more than 500 thousand comments and status updates on Facebook and 6 thousand tweets on Twitter every minute. AI can make sense of this data and analyze it as it comes, generating actionable and timely insights.

Read more: Check out our complete guide on conversational AI and how to use its fullest potential.

4. AI for support requests prioritization

As AI customer service is a true assistant for your business, it should work in sync with your human agents. And this is the main purpose of request prioritization and intent analysis. 

Automation means that while AI takes care of all basic customer queries and repetitive tasks, humans can focus on more complex challenges that require human intelligence, emotional involvement, and attention. 

And AI tools can identify keywords and analyze the nature of the request to understand if they should redirect it to a human agent. Afterwards, if needed, the software tags the right customer service representatives to take over the case.

AI for support requests prioritization

The software also allows your team to grow and develop as professionals. Instead of spending hours answering similar questions, they can focus on really complicated support tickets that allow them to apply their skills and professionalism in practice. 

5. AI for self-service 

AI can help customers with necessary self-service resources on every stage of their customer journey

How exactly?

Well, AI knows your website and the knowledge base like the back of its (nonexistent) hand. It scrapes FAQs, offers discounts, and often knows how to solve a particular problem before it even occurs. And all this without turning to a human a single time!

Read more: Learn more about consumer self-service statistics.

AI for self-service 

From browsing the website to completing the payment process, self-service allows your customers to get necessary guidance and help without any human involvement. It streamlines the process and minimizes the chances of leaving the page before making a purchase.

Read more: Check out our article on Tidio AI if you are interested in a tool for AI self-service.

It’s obvious at this point that AI customer service can become a game-changer for businesses. 


You probably don’t know of a tool that can do it all and give you all features described above.

We have good news for you.

Meet Lyro by Tidio.

Lyro for AI customer service: overview

Lyro is a new conversational AI chatbot created with small and medium businesses in mind. It means that the software can do it all, while being affordable even to nano businesses. 

Why is it so important? 

Currently, AI customer service solutions either come with a huge price tag and are targeted at enterprise businesses or have more issues than benefits (e.g., AI hallucinations). We believe in customer service for all, and so the idea for Lyro was born.

example of converastion with lyro

Lyro can save you from overflowing chats, offload your support team (without extra hiring costs), automate customer communication, and boost satisfaction with the power of conversational AI. 

It’s not just another chatbot for its features involve state-of-the-art AI technology.

Read more: Check out the comparison of Lyro vs Zowie AI to choose the best software for your business.

But everything in its own time.

What are the new features, exactly?

Lyro features

One click activation

Lyro doesn’t require a complicated setup process. In fact, it starts communicating with customers and learning from its interactions from the moment you click “activate”. On top of that, it responds to visitors within the information from your existing knowledge base, so you don’t need to train the bot or set up conversation flows. 

How is it able to operate so smoothly immediately after activation?

All features work together to ensure no hiccups.

FAQ scraping

Lyro has the ability to automatically scrape your FAQs and knowledge base sections in order to build all its responses upon this data and make FAQs conversational. 

If a customer question falls in the scope of the information Lyro has scraped, it will answer it. If the potential answer is not part of your FAQs and knowledge bases, Lyro will redirect the request to a human agent.

This is very important, since it minimizes the risk of AI hallucinations. Instead of making up the answer, the bot will invite an agent to take over the conversation. However, as the chatbot learns from its interactions, it will learn to be more conversational and not immediately route the customer to a support agent but try to find a relevant response instead.

Intent analytics

This is a feature essential for request prioritization. Chatbots learn to see the sentiment and customer intent by spotting certain keywords and triggers. By seeing what your customers ask about, you’ll be able to plan and implement automated conversations. 

Intent Analytics will help you to prioritize tasks, assign them to relevant agents, and learn about the topics of conversations without even reading them. It allows you to quickly and efficiently take care of the most urgent chats without making clients wait. 

This feature will help you engage customers and boost satisfaction while managing the time of your support team with maximum efficiency. Dividing conversation topics between agents and departments allows for maximum precision and quality when answering the inquiry

Want to boost customer engagement and satisfaction with AI?

Install Lyro 🚀 Learn more about Tidio Chatbot

Scalable learning

Lyro learns new information automatically as you expand your knowledge base and as the tool interacts with your customers. It creates new automated workflows as opportunities arise, so you don’t have to spend hours on teaching it about new products and services. 

This is the main difference between Lyro and regular chatbots. While usual bots have pre-designed conversational paths and rely on templates, Lyro uses NLP to understand questions and have human-like conversations. It can ask follow-up questions and chat with customers until they are satisfied.

Popular topics identification

Lyro is able to identify, classify, and redirect popular topics and queries on autopilot. It helps to analyze the intent and context of the conversation and highlight questions that should be redirected to the responsible support agent. 

This way, your support team and Lyro always work in sync with each other, for your customers to get fast and relevant responses quickly.

It might sound like something straight out of a movie about the future.


AI is the future.

Here’s a complete tutorial on how to set up Lyro for your business:

AI customer service: key takeaways

All in all, AI customer service is destined to become the standard in the business world. It improves customer support in a multitude of ways, cuts costs, and makes the work of your support agents more efficient. Most importantly, it boosts customer satisfaction with the power of state-of-the-art technology. 

As AI customer support software is becoming more advanced, businesses shouldn’t miss out on the opportunity to implement AI-powered solutions that could take their growth to the next level. The great news is that there are tools available not only to large corporations that could afford a fat price tag, but also to small and medium businesses. Lyro by Tidio is one of them.

Lyro combines a number of features that could become game changers for your support, including FAQ scraping, Intent Analytics, One click activation, Scalable learning, and more.

Don’t think twice about trying AI customer service. It’s definitely the future of customer service and the true key to winning more customers who will stay with you as loyal clients for a long time.

Supercharge your customer service with Lyro by Tidio

Learn more about AI chatbots

Lyro FAQs

How much is Lyro? 

Lyro is available to test for free on all Tidio accounts. All users on a free Tidio plan get 50 Lyro conversations. Notably, it’s the only conversational AI chatbot with a free version on the market. The full version of Lyro is available on the Tidio+ plan as well as an add-on to any Tidio plan. The pricing of Tidio+ is customizable and starts from $400 monthly. The price of the add-on starts from $39 monthly.

Is Lyro safe for business and customers’ data?

It is! Lyro is powered by Claude (Anthropic AI), which is currently the most secure LLM on the market. It was created with the goal to be honest, helpful, and harmless, making it a trustworthy and ethical choice of a language model. 

Does Lyro suffer from “AI hallucinations”?

No. The LLM that powers Lyro is aimed at minimizing hallucinations. The tool stays within your FAQs and knowledge bases, which prevents hallucinations and makes Lyro stick to the information within the predetermined scope. 

How is Lyro different from other chatbots by Tidio?

Lyro is an NLP-powered chatbot. Unlike traditional customer service bots, it doesn’t rely on pre-designed conversational paths and templates. It uses AI and NLP technology to understand customers, interact with them, ask follow-up questions, and make sure users are satisfied. 

How can Lyro benefit my business?

Lyro can drastically improve customer satisfaction and experience by offering lightning-speed quality assistance. It also increases the efficiency and productivity of your support team. And, as your business grows, Lyro’s knowledge grows with it.

What industry is Lyro suitable for?

Practically any industry! No matter what you do or sell, Lyro can help your customer service. The only industries it’s not qualified for are medical and financial.

How effective is Lyro?

Lyro is operated by a powerful machine learning algorithm that makes it a very effective chatbot. One click activation is a promise that Lyro works smoothly from the moment you install it. It can successfully handle up to 70% of customer service questions. However, as it learns over time, its performance and knowledge grows exponentially. 

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Maryia Fokina
Maryia Fokina

As a PR and Content Specialist, Maryia loves exploring hot topics in business and tech to further share them with the world.