Customer experience has always been a priority for companies. In recent years, we have witnessed the evolution of digital interactions between customers and brands. However, the results to date have been mixed. Bret Taylor and Clay Bavor, founders of Sierra, an emerging startup, believe that artificial intelligence agents could be the next technological frontier for improving the customer experience. In this article, we will explore how Sierra is revolutionizing the way customers interact with brands using conversational AI.
The importance of AI in the customer experience
According to Taylor,conversational AI will become the predominant form of interaction between people and brands. This is not just about customer service, but all aspects of the customer experience. Sierra is developing autonomous AI agents that can understand customer questions and requests and take the necessary actions to fulfill them. For example, a customer might ask a free question about a product or request to change an order. The AI agent should be able to interpret the request and connect to transactional systems to perform the required actions.
The challenges of human interaction with AI agents.
However, there are several challenges and risks to be faced when it comes to human interactions with AI agents. Taylor points out that there are complex technical problems to be solved, such as brand misrepresentation and processing of incorrect responses by language models. The latter problem is of particular concern because language models can invent information when they do not know how to answer a question. This could seriously damage a brand’s reputation.
Sierra’s approach to addressing AI challenges.
Sierra is addressing these problems with an autonomous agent approach. Rather than relying on a single model to generate an answer, Sierra uses up to seven models, including one that oversees the quality of answers. If a response is deemed questionable, it is sent for additional evaluation. Taylor acknowledges that addressing hallucination issues is still an ongoing research problem for the entire industry.
Addressing data privacy and security issues.
In addition to technical challenges, there are also privacy and data security issues to be addressed when dealing with customer data in an automated way. Taylor and Bavor ensure that their agents are designed to handle these issues. However, educating customers on how this new type of software works and mitigating the associated risks is critical.
Opportunities and challenges for Sierra
Despite the challenges, Taylor sees a huge opportunity for Sierra inconversational AI. He believes this new wave of AI will spawn new independent software companies, just as has happened with cloud and mobility. Taylor says there is still no market leader in the area of conversational AI, and this presents an opportunity for small companies like Sierra.
Results-based pricing model
Sierra also has an innovative approach to pricing. Instead of adopting a subscription or usage-based pricing model, Sierra intends to charge customers only when a problem is solved. This results-based pricing model reflects the power of AI in completing tasks and delivering tangible value to customers.
Possible challenges for Sierra
Despite the positive outlook, Sierra faces significant competition from established companies such as Salesforce. Taylor recognizes that large companies have resources and institutional expertise that startups do not. However, he believes that technological change offers an opportunity for smaller companies like Sierra to explore new spaces and seek new solutions.
Investment and funding for Sierra
Despite the challenges, Sierra has secured significant funding. The startup has raised a total of $110 million in funding from major investors such as Benchmark and Sequoia. This amount is extraordinary for an early-stage startup and reflects investors’ confidence in Sierra’s potential.