A combination of AI and human customer service has the most potential for positive impact at luxury retailers.
Research from Ventrica suggests luxury brands have the highest revenue tied to customer experience, but also the highest risk of churn.
The company surveyed 2,000 UK consumers and found 87% of luxury shoppers would make repeat purchases and 39% would make multiple purchases following a positive customer experience.
A positive customer experience was found to result in an average additional spend of £100 with the brand per enquiry.
However, Ventrica also found the luxury sector to have the highest customer churn rates, with poor customer experiences leading to a 33% loss in customers. 52% of customer service interactions at luxury brands were reported as negative – the highest of all sectors mentioned in the survey.
Ventrica argues this shows that a combination of AI and human customer service has the most potential for positive impact at luxury retailers. Just 23.4% of positive customer experiences were delivered by a blend of human and AI support in the UK, this rises to 39% in luxury retail.
Almost three-quarters, or 76%, of all positive experiences reported in the survey were delivered solely by a human and 72% of all interactions, whether they were started through a chatbot or elsewhere, were eventually resolved by a human.
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“Rather than seeing customer service as just a cost centre, brands should recognise it as a powerful driver of revenue and loyalty. Our research highlights that when customers receive fast, empathetic, and emotionally engaging support, they develop a stronger connection to the brand, leading to increased loyalty and higher spending,” said Iain Banks, CEO at Ventrica.
“The human touch is essential – consumers value authentic, emotional connections that create positive experiences, especially when resolving issues. By focusing on emotionally intelligent, high quality service, businesses can turn every customer interaction into a revenue generating opportunity, fostering stronger relationships and increasing lifetime value. In an era where consumers reach out to customer service teams an average of five times a year, brands have a golden opportunity to build trust and differentiate themselves.”
Last year, OSF Digital unveiled a centralised platform for Harvey Nichols. The initiative aimed to equip Harvey Nichols’ marketing team with advanced tools and insights, driving increased return on investment and customer engagement.
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