Twilio’s Kathryn Murphy on Using AI to Boost Customer Experience

I spoke with Kathryn Murphy, SVP of Product and Design at Twilio, about the challenges companies face in using technology to improve customer engagement.

Among the topics discussed:

• As companies seek to use technology to improve the customer experience, what common hurdles do you see run into?
• What advice do you give them to overcome these tech challenges?
• How is Twilio addressing the needs of its clients?
• The future of marketing tools and customer engagement? What are some key milestones we can expect in the years ahead?

For a transcript of highlights from this interview, see below. 

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This transcript of highlights has been edited for length and clarity. 

The State of Customer Engagement: Personalization

We do a state of customer engagement report every year. A huge percentage of companies, I think it’s like 75%, think they’re doing a good job. But only 50% of [consumers] think they are. So there’s still a gap where what we as a consumer think is a good job and what businesses are thinking about.

The other interesting fact from our customer engagement report is that each year, the amount of [consumers] that want personalization goes up.

And I think this is interesting because there’s this creepiness factor that I think we all worry about. Like, what’s the line you cross over – that line of personalization, you can easily cross over it. And then suddenly it’s like, oh, this is creepy.

Improving Customer Service with Tech

My really strongly held opinion is: you’ve got to start with data first. I think too many of us are like, oh, let me hurry and add TikTok and WhatsApp [to customer engagement efforts].

[Companies think] “I’ve gotta get ads out there. I gotta start talking to customers out there.” Instead of first saying, “do I really know my customer? And can I improve the individual experience?

Companies are like, “I’m on all the channels. I’m on everywhere.” And customers are like, “yeah, do you know what’s right for me?”

Rich customer data is at the heart of that. If you actually knew more about your customer, it’d be a lot easier to have a virtual agent handle a lot of stuff. And when you hand off to a live agent, it could be a lot more seamless, can feel better to the customer on the other end.

Part of the technology is the data, making sure we’re keeping it real time, we’re collecting and observing the changes and behaviors of our consumers.

You know, I heard one of our customers say, “I’ve had customers for 20 years, they’re not the same as they were 20 years ago.” And some cases, it was an 18-year-old that’s now a 38-year-old. And so that’s wildly different customer behavior. So we have to think of the data that defines our customers as humans. It’s living, it’s evolving, it’s changing.

Advice for Companies

Admittedly, I am a customer data platform lover. Just think, these things (the technology of a customer data platform) didn’t exist six, seven years ago.

I’ve been in e-commerce and retail for a really long time. [A problem is that] we each had systems of record about the customer. [But] some of the early problems of e-commerce systems were that the store system had one record, online had another record. Marketing has another record. Boy, we better bring these things together.

And so I think this is an age old problem. But it just became a lot harder because we’re mobile, we’re social – all of the digital experiences that we have.

And so the technology of a customer data platform is a really helpful tool for companies because it’s specifically designed and built to observe all these events and keep the picture of who you are, who is James, who is Kathryn, in real time.

And then it’s also specifically designed to publish this data, share this data with any other system that wants to use it. And so I love this technology because I think it’s really foundational  – it’s the “eat your vegetables” part of this problem.

[The data platform] is an observer of the events, so literally observing events on the e-commerce side, on social sites, on stores, wherever it might be. And it also keeps that single view of the customer assembled and updated, and then shares it – this is for all the other systems to use.

Twilio’s in the Marketplace

Twilio is known as being this great communication platform company, email, SMS, WhatsApp, and making it really easy for developers and companies to leverage all those communication channels easily. [It’s a] customer engagement platform. And the customer engagement is the combination of the data plus the channels.

It’s great, you need to have the data. But if you also don’t have the channels, you don’t have the optionality to speak to your customer in the right way, to engage with them in the right way, to know things like “this customer doesn’t like virtual agents – route them straight to a real person.” Or, “this customer loves virtual agents.” Probably my 18-year-old, you know?

And that is having that optionality is important. We each have different channels we trust.

We are using generative AI. We have made some announcements last month, under the brand name of CustomerAI. With CustomerAI, we chose that very intentionally because Twilio’s use of AI is all about making better customer engagement. It really is aimed at the customer.

And we’ll be doing some announcements next month, at our big conference, of some of our generative AI capabilities. We are all in on generative, using it in lots of different ways.

Future of Customer Engagement

The other way that AI helps us is by democratizing tech, making it more accessible. I think it’s actually like what we talked about, this expectation gap, all the things that businesses need to do.

If you’re a small company, it’s really kind of daunting, it’s hard. And so for the future of customer engagement, is also about making it possible for companies big and small to reach customers in the right ways.

So to have that data, have the access to channels. But that’s one aspect. The other that I see as a really exciting future development: a lot more optimization based on the data. Based on a combination of generative and predictive AI.

Most marketing teams today have big calendars and campaigns – I’m gonna run this promotion on this day, and I’m gonna reach customers on this day.

[But in] the future, I’m going to just use data and AI and integrations to reach my customer when it’s right.

That might be every day, or for some people that might be once a week. And I think it’s moving away from “we have a big calendar and customers opt in or out” to, “we have incredible knowledge about our customer and access to technology, both AI and tools that let us reach the customer at the right time.”

Like we’ve said, “right time, right place.” But I think it’s now upon us and possible, and not just the big companies, but all companies can do this.

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