AI vs. humans: Who wins in handling service rejections?
New research shows chatbots can help reduce negative reviews in certain cases, despite the general preference for human agents
There will come a time when personal interaction in handling customer services becomes obsolete. And that time might be sooner than we thought. Companies have increasingly adopted artificial intelligence (AI)-powered chatbots to handle customer requests, leading to improved service management, reduced labour costs, and the efficient delivery of standardised services. But, what is the catch?
According to the latest report by Spherical Insights, Global Chatbot Market, the market size of global chatbots reached US$5.39 billion in 2023, and it is projected to surge to US$42.83 billion by 2033. As chatbots continue to rise in prominence, it is crucial for companies to gain a better understanding of customer reactions to the services provided by this advancing technology.
Chatbots are designed to handle customer requests in a standardised manner, relying on preprogrammed procedures and algorithms. “Indeed, consumers often have an aversive attitude toward services provided by robots because they perceive that robots lack uniqueness and empathy,” says Shen Hao, Professor of the Department of Marketing at the Chinese University of Hong Kong (CUHK) Business School.
However, the service from chatbots does not always carry a negative connotation, especially when companies have to reject consumer requests, which is sometimes unavoidable. “Our research finds that when consumers receive a rejection of their service request, they evaluate the service less negatively if the service is handled by a chatbot agent versus a human agent,” Professor Shen says.
In a new study titled The rise of chatbots: The effect of using chatbot agents on consumers’ responses to request rejection, Professor Shen and Professor Xiong Ji of the Southwestern University of Finance and Economics, Professor Yu Shubin of BI Norwegian Business School, explored how and why consumers react differently when their requests are declined by a real person or a chatbot.
Low expectations from chatbots
