Hey Everyone,
As you know I track how AI might be eating jobs and impacting the future of work. I think Klarna’s pilot is fairly interesting here. Klarna struck a deal with OpenAI last year and says its AI assistant has now been active globally for a month, handling the workload of 700 full-time human agents.
The fintech company's co-founder and CEO Sebastian Siemiatkowski expects its ChatGPT-powered AI assistant to drive an estimated $40 million in new profit in 2024. But at what costs to jobs?
Is this the first time we've seen so many real world jobs disrupted by recent LLM advancements at publicly traded company? The Swedish fintech, which was criticized for its handling of a dramatic staff reduction in 2022, is touting new efficiencies powered by OpenAI.
It feels a bit weird to cheer about this:
Klarna's AI assistant can handle nearly 70% of the customer requests by itself in its first month and is doing the job of an equivalent of 700 full-time agents.
After the initial 4-week pilot, Klarna AI Assistant powered by OpenAI's ChatGPT is now live globally.
In addition to the above, some other staggering insights & data:
The AI assistant is on par with human agents on customer satisfaction score
It is more accurate in errand resolution, leading to a 25% drop in repeat inquiries
Customers now resolve their errands in less than 2 minutes compared to 11 minutes previously
It’s available in 23 markets, 24/7, and communicates in more than 35 languages
It’s estimated to drive a $40 million profit improvement to Klarna in 2024
I realize companies are bullish on bots, AI agents and all those things. Klarna is an impressive and disturbing use case. One month after taking its OpenAI-powered virtual assistant global, the Swedish buy-now, pay-later company has released new data touting its ability to handle customer communications, make shoppers happier, and even drive better financial results.
I cannot shake a feeling of unease when I read this.
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Is AI Eating FinTech or Customer Service jobs?
Influencers Linas Beliunas really drove this home in a recent post.
Customer Success
The chatbot has handled 2.3 million customer service chats in 35 languages. Available on the Klarna app, the chatbot aims to save consumers time in managing refunds and returns.
Posting on X, Sebastian Siemiatkowski, Klarna CEO and co-founder, however, struck a note of caution and said the data raised “implications for society”.
He said:
“As more companies adopt these technologies, we believe society needs to consider the impact.
“While it may be a positive impact for society as a whole, we need to consider the implications for the individuals affected.
“We decided to share these statistics to raise the awareness and encourage a proactive approach to the topic of AI.
“For decision-makers worldwide to recognise this is not just ‘in the future’, this is happening right now."
Just for clarity this is not a co-pilot, this is AI performing and concluding the conversations and errands by itself, he added.
Announcing a partnership with OpenAI early last year, Klarna said it was one of the first companies to integrate the firm’s groundbreaking ChatGPT technology into a plug-in for shopping.
Siemiatkowski has been an outspoken advocate and proponent for OpenAI and ChatGPT, with Klarna being one of the first businesses to adopt ChatGPT Enterprise.
Brief in Summary
The AI assistant has had 2.3 million conversations, two-thirds of Klarna's customer service chats
It is doing the equivalent work of 700 full-time agents
It is on par with human agents in regard to customer satisfaction score
It is more accurate in errand resolution, leading to a 25% drop in repeat inquiries
Customers now resolve their errands in less than 2 mins compared to 11 mins previously
It's available in 23 markets, 24/7 and communicates in more than 35 languages
It's estimated to drive a $40 million USD in profit improvement to Klarna in 2024
If more case studies like this emerge, AI will certainly impact some sectors of the job market.
Klarna said the chatbot is more accurate in errand resolution and saw a 25 per cent drop in repeat inquiries. However, customers can still choose to interact with live agents.
Klarna Bank AB, commonly referred to as Klarna, is a Swedish fintech company that provides online financial services. It’s a global leader in BNPL, buy now pay later that is popular among certain kinds of shoppers.
It wants to IPO ASAP with a $20 Billion valuation. How else will FinTech leverage Generative AI in the years to come I wonder.
"Klarna is at the very forefront among our partners in AI adoption and practical application." said Brad Lightcap, COO of OpenAI. "Together we are unlocking the vast potential for AI to boost productivity and improve our day-to-day lives."
Is this the first convincing case you can think of where hundreds of theoretical jobs were replaced? I mean, they didn't really "fire" 700 people, but are they going to avoid hiring some new folks as a result? You bet. I can't think of any other recent examples of this happening specifically due to AI (or AI being blamed for it, anyway).