Retail Customer Service: Everything you need to know about what it is and where it’s heading

Written by Can Ozdoruk on Dec 23, 2020

What is retail customer service?

Retail customer service is the assistance and advice provided to those who buy or use products. The Oxford Dictionary defines customer service as a service specifically provided by a company. As the industry evolves, we’ve seen many cases where communities unaffiliated with the company can also engage in the practice. 

Interestingly enough, the next search result for “customer service definition” on Google comes from Investopedia. This indicates that customer service has very much turned into a business-driver and helps a retailer’s bottom line.

You can watch their very 90’s-style explainer video on the state of customer service below.

Source: Investopedia

While some things never change, this is not the case for the retail industry. Retail is a very competitive industry. Companies are increasingly turning to AI to solve large-scale business problems, including the top retail customer service challenges. But before we get into customer service strategy, let’s start with the basics.

Online shopping is shaping retail trends

Shopping patterns for traditional brick and mortar retail are shifting drastically. Emerging online companies are capturing the hearts and wallets of consumers. Off-price retailers are taking away a growing share of the market. As the ecosystem of retailers competing on a global scale rapidly evolves, customer expectations are also rising quickly. To combat this, and to increase retail sales, many retailers are adding Shopify chatbots and other technology to increase customer experience. 

However, companies can no longer rely primarily on product ingenuity. Salesforce found that 66% of customers say it takes more for a company to impress them with new products and services than ever before. In what used to be an after-thought for many retailers, customer support is establishing a strong foothold in the shopping experience, often dictating people’s buying habits.

The importance of customer service in retail

Customers anticipate getting a quick, personalized resolution on their channel of choice. 24/7 support is no longer a perk, it’s an expectation. In fact, 9 out of 10 consumers say they would pay more to ensure excellent customer service.

Unfortunately, providing a great customer service experience is much easier said than done.

Retailers often struggle to keep up with the rising tide of increasing ticket volumes when it’s more critical than ever to stay afloat. According to Zendesk, 97% of U.S. consumers say bad customer service changes their buying habits. AI can help retailers resolve over 50% of customer service tickets on email support, chat, social, and voice.

Here’s what customers say about what they expect from retailers in 2020 and beyond:

To download a copy of our full Customer Service Benchmark report for Retailers, click here.

7 Retail Customer Service Tips and Best Practices:

  1. Keep the focus on the customer: Immediacy and convenience are what customers expect when they reach out to a retailer with a question or an issue. Retailers need to focus on resolving tickets quickly and making experiences as effortless as possible.
  2. Address your customers by name: Bring in the human element. Personalize conversations by using customers’ first names. Retailers should also empower human and agents who provide automated support to access historical data and past conversations to further contextualize every interaction.
  3. Provide an omnichannel experience: Empower your customers to get in touch on their channel of choice, whether it’s email, social media, messaging, live chat, phone, or voice assistants.
  4. Carry the context forward from channel to channel: If a customer reaches out on one channel, they should be able to pick up where they left off if the next touchpoint happens on a different channel. Don’t make customers repeat themselves or start a conversation order – even if they channel hop.
  5. Be available all the time: Customers expect resolutions quickly, even if an issue arises on nights, weekends, or on holidays. Adopting a customer service chatbot can help retailers provide around-the-clock support, 24/7.
  6. Get out in front of issues with proactive support: Retailers should leverage AI and predictive analytics to anticipate when an issue may arise and proactively reach out to a customer. If an order is going to be delayed, for instance, alert the customer immediately saving them the hassle of needing to inquire about a missing package.
  7. Upsell and cross-sell only when it’s hyper-relevant: The last thing a retailer wants to do is rub a customer the wrong way and seem pushy. AI can help retailers understand with high precision the best times for a virtual or human agent to cross-sell and upsell, and identify the best recommendations based on the customer.

AI is solving retail’s biggest customer service challenges

Retailers are turning to Artificial Intelligence (AI) to improve everything from operations and inventory management to create good customer service and loyal customers. AI adoption is ramping up quickly. Estimates for global retail spend on AI top $7.3 billion per year by 2022 according to Juniper Research. 

Operators of retail businesses are adopting AI to solve large-scale business problems, including the top customer service challenges. By bringing AI into the workforce retailers augment the work of human agents to delight customers with quick resolutions across channels.


Stores in the retail industry are changing faster than ever as they shift to online stores. Successful retailers have always placed an emphasis on providing top-tier service to improve the retail customer experience.

Traditionally, that meant training your employees on some very specific customer service strategies. The way to do that in this digital world we live in today is changing the whole ball game.

AI can help retailers resolve over 50% of customer service tickets on email, live chat, social media, and voice (an emerging – and powerful channel) within seconds. Human agents are freed up to focus solely on complex, high-touch customer needs. Customers love immediate resolutions. Human agents are more fulfilled. As a result, the customer feels good and agent happiness soars. 

The state of retail customer service (eBook)

We have published several world-renowned reports on how retailers are stepping up their customer service skills and encouraging customer loyalty with AI.

Click any of the links below to get more of our insights on retail customer service before you learn more about our solutions for chatbots in retail.

Find out what your ROI will be if you build an AI chatbot tool. Try our free chatbot ROI calculator.