How AI will help companies keep customers happy

AI is set to revolutionize lots of industries, including the customer service sector. Barak Eilam, CEO of NICE Ltd., tells the Yahoo Finance Live team about how AI will help companies keep customers happy.

Video Transcript

JULIE HYMAN: We've been talking about AI, of course. AI's playing a larger role in the customer service space, in particular, streamlining customer requests to address issues faster and to predict future roadblocks. The result, at least, ideally, how happy your customers and human workers with more time to focus on higher value tasks.

By 2025, 70% of all digital workplace service transactions will be done via automation compared with just 30% today. That's according to Gartner Research. Software solutions company, Nice, is bringing conversational AI to the customer experience with their CX1 system. The company currently partners with more than 25,000 organizations worldwide, including American Airlines, Disney, and Morgan Stanley.

Barak Eilam, the CEO of Nice, joins us now with how AI is shaping the future of the customer service experience. Customer service, I have to say, writ large, is not well regarded in a lot of fields, especially when you're not interacting in person.

I think about telecom companies. I think about airlines, which we just mentioned. So how can we make it better? Is this going to help make it better?

BARAK EILAM: I truly believe so. I've been in this space for about 24 years. And I've been the CEO of Nice for 10 years. And AI is a true game changer for the industry of customer service. If you think about it, the ideal way of what we want is consumers, we want almost a personal service individual in every company that will be dedicated just for us. Obviously, it's not really effective. And brands cannot really afford to do that.

What AI brings to the table is this whole notion of mass personalization at scale. It will take time. And enterprises are just-- now, we are in the early innings of enterprise adoption of AI. But that for the first time really, bring the ability to have this breakthrough in the customer service space.

BRAD SMITH: And so in customer service, as Julie was alluding to though, we are looking for that human connection. Because there's often more understandability. How does AI actually get past where those pitfalls might be because it's AI and not us actually speaking to somebody? And how does that impact a company too? Because that's business lost if that experience doesn't go as planned because they've invested in AI.

BARAK EILAM: So first, you're absolutely right that brands understand that customer service today is very strategic for all brands. The most important assets are the consumers. And what the AI brings to the table, I think, is three things. And it's not just one silver bullet. The first one, it is an industry or the whole notion of customer service that is very rich with people. There are 50 million employees that work only in customer service around the globe.

This is a highly skilled labor. And there is a need for more of them. What the AI brings to the table is the ability to really provide amplification of that skilled labor and get them to be much more effective as they interact with consumers.

The second is the whole idea of the ability to take decisions at a much faster velocity by organization. And take care of you, as a consumer, right now and not just in the day or two from now. And the third is what I said about the mass personalization at scale. It's not going to be just one thing. It's not everything going to go into AI. We see it already today with what we do with customers and enterprises. It's the, how do you inject AI into well-established processes of customer service?

JULIE HYMAN: So just to make it very concrete for people, when I'm doing a live chat with whatever company, let's say, my phone company, my internet provider, which I may or may not have interacted with earlier in the week. I'm typing into the chat. And the bot comes back to me and says, whatever it says, which is not what I wanted from this company.

So is it already being put in place through some of your products that it will better understand what I want and give me back a better response? And then also, when I get connected with the human, cue the human perhaps in a better way. Is that what's already happening in your product?

BARAK EILAM: In our products, yes. I think we are in a certain race right now of businesses adopting AI. And this experience you have with your phone company or any other company is yet truly empowered by AI. We've seen in the last few months individuals adopting AI out there. Generative AI-- we all experience that. It's very cool. When enterprises think about adopting AI, there are a few other things that need to be taken into account.

It needs to be extremely precise. So the experience that you have will be extremely precise with the brand. It needs to be compliant and secured. It needs to be aligned with the brand business goals and what they want to achieve from the interaction with you. And, of course, it needs to be tightly connected to all the banking system. And that's how you'll get to a much better experience. And at the end of the day, it does need to connect at the important moments to that service individual that sits on the other hand and can intervene in the moment that there is some ambiguity about your intent as a consumer. so you won't get lost in this journey.

JULIE HYMAN: So we were talking earlier in the show about how this is very conceptual right now. And we want more concrete. So tell me concretely, what the demand is for this product from your customers right now.

BARAK EILAM: The demand is extremely high. And enterprises understand today that generative AI is really the next big thing. However, the interaction we have with customers-- and we have 25,000 customers, we cater to 85% of the Fortune 100-- they cannot take just generic generative AI and put it into their environment, from the reasons I've mentioned before about security and compliance and zero tolerance for errors and alignment to the brand.

So we are right now seeing a dramatic increase in both the demand for the solution that we have. We have a platform called CX1 and its core AI called Enlighten. And that's basically the difference between generic generative AI that you see out there versus an AI that businesses can trust. And that's what we bring to customers

JULIE HYMAN: Can you put some numbers around it for us?

BARAK EILAM: So we reported earnings about a few weeks ago. And we talked about dramatic increase on the number of our AI revenues. They are going at three figures of percentages. And I can tell you that right now, already as the EU progresses, many of our deals are now double and triple in size due to the addition of AI, which I think, in general, we are going to see a change in where the A value go right now. You see it in the market in the semiconductor. Classic beginning of every technology wave. It will go up to the infrastructure level. But eventually, it will end up with the specialized applications.

BRAD SMITH: What is the benchmark margin contribution that you would like to see from your AI investments at the company?

BARAK EILAM: So we run on a very healthy gross margin as a company. We run it north of 70%. And overall operating margin is closer to the 30%. And AI is extremely accretive to our margins.

BRAD SMITH: All right.

JULIE HYMAN: All right. Barak, thank you so much for being here. Barak Eilam is CEO of Nice.