Nearshore Americas

Virtual Bots Offer Strategic Advantages But Will Never Completely Replace Human Agents

With the rapid improvement of artificial intelligence in recent years, an increasing number of enterprises are turning to virtual agent (VA) solutions to complement their human agent offerings. Although VA capabilities are still fairly limited, they can bring tangible benefits by handling the more routine customer inquiries and freeing up human agents to answer more complex, higher value queries.

According to OPUS Research, the global VA market was worth approximately US$223.75 million last year and is expected to reach $446.25 million in 2015, before surpassing $700 million in 2016. In Latin America a number of major firms have already embraced VA technology, including Panama’s Copa Airlines, Brazil’s TAM Airlines, and Fiat and Movistar in Argentina. The leading providers in the Latin American VA market are mostly global firms like Next IT, IntelliResponse and Genesys from the United States, Atos from France and Indra Sistemas from Spain, as well as the Brazilian company Direct Talk.

The Evolution of VAs

For some, the phrase “virtual contact center agent” may bring to mind the frustrating interactive voice response (IVR) systems employed by so many businesses that all too often fail to understand what you are saying. Many companies in Latin America still rely on IVR, but the most common form of VA is in the online chat format, with the agent appearing in the form of an avatar. Maiara Munhoz, ICT industry analyst at Frost & Sullivan, told Nearshore Americas that “IVR is still a growing trend here in the region, but it’s limited because it can be repetitive and customers want to feel like they are talking to a human being. IVR can handle certain simple demands like checking the balance on your account or confirming a doctor’s appointment, but if you want more personalized service I don’t think IVR is capable. That’s where the VA comes in.”

Munhoz, who authored a 2014 report on Virtual Agents in the Latin American Market, explained that “most consumers that use customer care today are younger people who want to use chat or social media. The younger generation usually doesn’t want to call the companies. So chat is one of these options where you can talk to a virtual agent and solve your problem without having to call.” She added that today’s advanced artificial intelligence “enables VA to go further and resolve more complicated issues (than IVR). For example, if there’s a problem with my flight it can tell me what my next flight is going to be or what other solutions I have. It can give more personalized customer care and it can solve much more complicated requests without the need for human agents.”

Tim Peters, Director of Marketing at Intelliresponse, a Toronto-based provider of VA solutions, agreed with Munhoz’s assessment. “This is what the modern digital customer wants. Your website is the first place they’ll go if they’re looking for information about a product or if they have a question. So this allows your customers to self-serve, find the right answer and move on with their day,” Peters said. “Instead of customers having to look at a long list of FAQs, virtual agents specialize in providing that one right answer. That reduces customer effort and frustration.”

Where’s the Value?

According to Munhoz, the primary benefit of utilizing VAs is that it enables companies to downscale their contact center operations. “First of all it is about reducing costs for companies, because nowadays the highest costs you have are for human agents, plus the infrastructure, rent, computers, etc,” she said. “Through virtual agents you can also get increased sales volume and value because a virtual agent can reach a greater quantity of customers and they can do it faster than human agents,” she added.

Furthermore, VAs can facilitate improved customer retention and acquisition. “Artificial intelligence also allows the virtual agent to retain historical data for each customer. So it can go back and see when they’ve previously contacted the company and so it can provide very personalized customer care which is something that customers value a lot today, and it’s something that’s really hard to find today, especially in Brazil. It’s a great differentiator,” Munhoz said.

“The other big part of it is the analytical side,” Peters added. “Imagine the power from the buyer’s standpoint of being able to analyze the questions that are being asked by their customers on a daily, monthly or real-time basis. You’re able to spot trends and get direct access to your customers’ trains of thought. That’s very powerful in terms of understanding the areas in need of improvement.”

Serving Major Airlines

Founded in 2000, IntelliResponse has 160 customers and over 450 global deployments in financial services, telecommunications and utilities. “We’re generally looking for large enterprise organizations who have a large customer base asking a lot of repetitive, tier-one type questions,” Peters said. In late 2011 it became one of the first major VA providers to operate in Latin America upon signing a deal to serve Copa Airlines. IntelliResponse was then acquired last November by [24]7. “With their support we will be able to expand further into South America,” Peters said.

Powered by IntelliResponse’s multichannel Answer Suite platform, Copa Airlines’ digital self-service solution, Ask Anna, enables customers to ask questions in English, Spanish or Portuguese via a chat box on its website. Prior to the deal with IntelliResponse, only 35% of Copa Airlines’ customer service interactions were handled online, but within 18 months of introducing Ask Anna, the VA platform was handling 50% of all interactions. “It’s a multi-channel solution so the technology can also be integrated into Facebook and into mobile apps. It can also be used internally at call centers. Imagine the power for your call center agent to be able to ask it a question and immediately be directed to the right answer, instead of flicking through a database or a PDF in order to answer a question,” Peters explained. IntelliResponse’s VA offerings are primarily through text, although they do have the capability to do audio too, he added.

Other VA providers have prospered through similar deals. Next IT, which closed a major deal with TAM Airlines last year, was recently awarded the 2014 Frost & Sullivan Award for Competitive Strategy Innovation in Latin America. What differentiates Next IT from other providers is the experience that it brought from the U.S. market to Brazil, noted Munhoz, who expects both Next IT and the VA market to grow significantly in Brazil in the near future. “They have their own technology; they built all of the artificial intelligence and the software so the integration with their customers’ sites is very easy,” she explained.

Room For Improvement

The artificial intelligence that powers VAs is still relatively new and will of course continue to improve in the years to come. “There’s always room to continually improve virtual agents. Our research and development team is always trying to improve the general accuracy by creating better algorithms to better understand the customer questions and produce more accurate results,” Peters said. “The interesting thing that’s happening with virtual agents is the work to create more of a dialogue type approach and provide more of a personalized back-and-forth interaction based on their responses.”

Having tested many of the VA offerings in the LATAM market, Munhoz’s overall verdict was positive: “They are very efficient. Even though sometimes they might not be able to fully understand what you are saying they can provide certain options, saying ‘What did you mean?’ and offering three or four possibilities related to what you asked.” However, she noted that “there are limits to the technology” and that “there’s still a lot to come in order to reach the optimal level.”

“Some people are still not so sure about the efficiency of VAs. The technology is still in evolution. The first VAs we saw for chat were really not that efficient. You couldn’t do much and if you wrote anything slightly different or complicated then they weren’t able to follow it at all,” Munhoz said. “But I think there has been a great evolution. We’ve had some companies coming into Brazil that bring great experience from other countries that are more evolved at this. And we’re seeing growing acceptance from the companies that are acquiring these solutions and from the consumers.”

As for existing flaws, Munhoz added that there are certain problems that VAs simply can’t solve. And in such cases, there is no natural link to continue the discussion with a human agent. “That’s frustrating for customers because you’ve already reached the company and spent some time in chat trying to solve your problem and now you have to start all over again through the channel  you didn’t want to use in the first place: the telephone,” she explained.

Technology research firm Gartner predicts that as a result of robotic process automation, digital businesses will require 50% fewer business process workers by 2018, but Munhoz emphasized that while VAs may lead to reductions in the size of contact centers, they are unlikely to ever make human agents completely obsolete. “We’re always going to need human agents. Virtual agents will replace a lot of human agents over time, but it will be a while before that happens and there are certain, more complicated problems that just need a human touch in order to resolve them,” she explained. “And there are older generations and certain people who aren’t good with this kind of technology. They don’t like to use it or they don’t feel that they’re being well treated or that they’re going to receive the same kind of care that they would get from a human agent.”

Peters was also adamant that “virtual agents are not meant to replace human agents whatsoever.” On the contrary, he claimed, they will complement human agents by enabling them to “focus on the tier-two and tier-three support issues, the more complex, higher value tasks.” The introduction of VAs can even help deduce agent turnover and enhance moral by making their jobs less stressful and mundane, he said, because human agents will no longer be “bogged down with very boring, repetitive questions that aren’t that interesting to handle.”

Duncan Tucker

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