Getting Smart About Your CX Strategy

Companies are investing $1.5 billion in Internet of Things (IoT) to meaningfully innovate the customer experience, products, and operational processes.

Intelligent agents are software programs that perform an array of tasks that a person would otherwise do manually. The technology Internet of Things (IoT) is an intelligent agent. It encompasses internet-enabled devices that intelligently interact with people to complete manual tasks for them. With increased interaction, IoT devices become smarter over time, learning preferences to influence behavior.

Today’s digital economy is driven by experiences. As companies adjust to the experience economy, the customer experience (CX) has become the cornerstone of their digital business strategy – and with sound reason. Connected devices are giving businesses unprecedented access to a greater, more personal range of customer data. They’re leveraging these insights to innovate the CX, products, services, and increase revenue streams.

For consumers, the lifestyle impact of intelligent agents such as IoT may be subtle, yet great. These technologies unwittingly raise their expectations for excellent customer experiences. For companies, it presents an enormous opportunity to harness data in more effective meaningful ways that directly fuel growth and leadership.

37% of companies are actively researching or have on their radar IoT as a tech priority this year. 33% plan to increase spending in this area in the next 12 months. [IDG]


Consumer adoption of IoT devices has steadily risen over the years. Projections indicate that by 2020 there will be 20 billion installed connected devices. By 2021, 50% of households will become smart homes. As IoT technologies reshape people’s lifestyles, they create compelling business cases to invest in intelligent agents as a core part of their digital business strategy.

IoT In Action

B2C industries have experienced the positive impact IoT can have on growth and sales. Amazon is the well-known example. They are the game changer for customer experience. The impact is two-fold. On the consumer side, Amazon reset customer expectations, raising the bar for an at-home exceptional shopping experience. Amazon’s Alexa adds convenience, ease and value in all aspects of shopping – pricing, shipping, and new product awareness. On the business side, online retailers and brick and mortars, have to overhaul their entire CX strategy to compete against the Amazon standard. Amazon is breaking into other sectors, like healthcare, and disrupting them as well.

Intelligent Agents are increasingly taking the form of IoT devices. Companies are increasingly integrating with IoT to create new and easier pathways for customers to access their products and services. For example, restaurant chains like Dominos and Pizza Hut allow customers to place orders through their Alexa smart speakers and Uber and Lyft passengers can schedule their next ride with a simple voice command.

Recommendation engines are another type of intelligent agent that elevate the customer experience. They enable companies to introduce customers to new lines of products based on their history and preferences, without going through a cumbersome discovery process. These recommendation engines appear in a variety of touchpoints such as a dedicated suggestions space, search suggestions, and advertisements. Forrester estimates that in 2018, customers representing $24B in spending will turn to recommendation engines to escape the noise and intelligent agents will influence 10% of purchase decisions.

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Other Use Cases Of Intelligent Agents

Intelligent bots and virtual assistants automate processes like initiating customer service cases, support, and lead generation in a fashion that is brand-consistent and seamless. Chatbots are programmed and trained with information from user manuals, product guides, and FAQs to provide accurate answers to customers questions, and relieving the customer of the burden to search lengthy documents for answers. These types of intelligent agents are helping companies reduce costs related to customer service and support and delivering positive on-brand experiences that build satisfaction.

Depending on the nature and purpose of the product, organizations involved in manufacturing can embed IoT devices into their offerings. Such devices can monitor the product’s status and performance, predicting the need for service, maintenance, and replacement. They can also give customers access to real-time data about their products, the means to automate certain aspects of using them, and a personalized experience. On the other hand, services can deploy such devices across the processes to provide customers with information such as estimated delivery times, what’s popular right now, and so on. Such information not only keeps customers updated with the most recent developments but also engages them with the brand, helping build a personalized experience. When a major online fashion retailer realized that half of the customer support queries it received pertained to delivery times, it started sending regular updates to customers’ smart devices. These updates, based on information gathered from IoT devices, not only reduced the strain on the customer support system but also reduced churn and increased customer engagement.

Improving Brand Identity

When organizations provide superior experiences through intelligent agents at touchpoints, they allow customers to create positive connections with their brands. This translates to reduced customer churn, increased customer satisfaction, high customer loyalty, and greater brand awareness – indispensable advantages in a marketplace that suffers from a glut of choice. A Frost & Sullivan study estimates that companies worldwide lose about $300 billion due to bad customer experiences and the resulting increase in customer churn.

Moreover, the proliferation of intelligent agents is in part due to the tools and platforms from various providers including Microsoft Azure, Oracle, Amazon Web Services, IBM, and Salesforce.  Previously, organizations that were successful at adopting intelligent agents did so with proprietary solutions. However, newer tools have eliminated the need for expensive storage, computing capability, and the expertise required to develop and deploy agents. Businesses also have the option of partnering with vendors to identify the need for intelligent agents and develop them. The numerous options available make adopting intelligent agents and building stellar customer experiences possible for almost any organization looking to innovate in today’s experience economy.

Addressing Security And Privacy Concerns

Intelligent agents collect highly personal and sensitive data about the entities that use them. It’s a well-known fact that these technologies are particularly vulnerable to cyber attack which create hesitation from businesses to bring them into the foray of operations. Even so, businesses are weighing the IoT benefits of increased sales, better products, improved efficiencies, and reduced operational costs against the security risks. Understanding that there is a compelling business case for implementing IoT, IT leaders are taking measured steps to create security blueprints and usage policies to address security vulnerabilities in advance of installing IoT into their private networks.

Spending on IoT security will total $1.5 billion in 2018 (up 28% from 2017) and reach $3.1 billion by 2021 (up 107% from 2018)


On the other hand, consumers on average, are willing to tolerate a relatively large degree of risk and share of personal data in exchange for the conveniences smart devices provide. If spending is any indication of adoption trends, intelligent agents and IoT are comfortably making themselves at home for consumers and businesses alike.

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