Chatbots and conversational AI add a smiley face to support

The way companies talk to their customers can significantly impact retention and business growth, according to new research. Three-quarters of US consumers say communication that makes them feel valued is a top factor in continuing to do business with a brand, but generations are split about what makes good communication, a new report from customer communications company Intercom reveals.

The study of 1,000 US consumers found that three in four say communication that makes them feel valued is a top or the most important factor when doing business with a brand. A total of 64 per cent went further and reported they would leave a business if they didn't feel valued. 

Consumers said if they had not had their issue resolved (66 per cent) or been ghosted by a support representative (65 per cent) would also make them walk away from the business. Feeling valued and respected - 61 per cent - was found to be even more important than getting a quick customer support response.

The study highlighted generational differences in the style and tone consumers want. Good customer support varies based on the person and situation, say the researchers, making it essential for businesses to deliver personalised communication grounded in context and a deep understanding of each individual customer.

"Consumers have higher expectations for businesses to be transparent, to be present and to be available to connect with,” says Intercom Co-founder and Chief Strategy Officer Des Traynor. “How you talk to customers, where you talk to them, and what you say impacts whether or not they continue to give you their business."

Cringe-worthy language and slang puts customers off

Personal and friendly communication strengthens the relationship between businesses and their customers, say researchers, but tone is crucial: consumers say disrespecting them (64 per cent), using “cringe-worthy” language or misplaced slang (41 per cent), trying too hard with inauthentic communication (35 per cent) or using too many emojis (28 per cent) in support interactions will cause them to take their business elsewhere.

While 59 per cent of people accept companies using emojis in support conversations, they prefer facial expressions over objects. Researchers say there appears to be a shift along generational lines: younger generations are twice as likely as older ones to want companies to use emojis and GIFs, signalling a shift in how businesses will need to adapt their support and communication strategies as younger generations become primary buyers.

Different situations call for different styles of communication, says Intercom. Chatbots and online chat are most preferred for answering a quick question (49 per cent), confirming an appointment or delivery time (37 per cent), or cancelling an order (30 per cent), with 79 per cent saying overall, there are times and places where they definitely prefer chatbots and online chat. 

Only 21 per cent say there's no circumstance where they would want to interact with a chatbot or online chat — however, this sentiment is higher for Boomers (34 per cent). Overall, consumers don't want to share sensitive information via chat, but Millennials (27 per cent) are more comfortable doing so than their younger and older counterparts.

ChatGPT could change everything

Automated customer support tools like chatbots have room to improve. While consumers are split nearly 50/50 on whether they find them aggravating or helpful, more Millennials (65 per cent) find them helpful and easy to use than any other age group. And with disruptive technology like OpenAI's ChatGPT now available, huge leaps in customer support automation and artificial intelligence are clearly imminent.

Most consumers prefer professional (56 per cent) rather than casual language (44 per cent) from companies. However, Gen Z's growing influence may change this - 61 per cent of Gen Z respondents prefer a more casual approach.

Knowing a customer's purchase or usage history is the top way to make them feel valued, say researchers, and 66 per cent of respondents rate it among the top three factors that show they are valued, including receiving VIP treatment (52 per cent) and proactive tips and support without needing to initiate a conversation (51 per cent). Simple personalisation, like using their first name in communications and added greetings and goodbyes, rank lowest.

Consumers want to engage with businesses are changing, with 86 per cent of respondents saying they're OK with companies communicating in the same way they communicate with their family and friends.

When asked which ways consumers like connecting with family and friends that they wish businesses would use, respondents across all generations (60 per cent) said communicating by text or direct messages. From Gen Z to Boomers, this is the more welcome approach.

More than one-third (35 per cent) of respondents also ranked sending a stream of shorter messages instead of longer paragraphs as a top wish. Millennials showed the strongest preference (49 per cent) for this style.

Automated phone systems are the most disliked channel overall across all respondents, followed closely by live phone calls. Gen Z and Gen X in particular dislike live phone calls, according to the research.

"Personalised support is crucial for businesses looking to edge the competition," says Traynor. "Consumers choose to spend their money where they feel valued, and how businesses support and talk to them is a huge factor."