Gen Z, AI, and the New Rules of Customer Service

Gen Z doesn’t see AI as the future of customer service. For many, it’s already part of the experience. 

They use AI to compare products, track orders, troubleshoot issues, get answers, manage purchases, and move faster through digital interactions. And while retail may be one of the clearest examples of this shift, the impact goes far beyond shopping.  

Across industries, Gen Z is raising the bar for what modern customer service should feel like: fast, intuitive, transparent, and easy to navigate. 

According to The Liveops 2025 Holiday AI & Customer Service Report, AI use varied sharply by generation during the holiday shopping season. 89% of Gen Z used AI during holiday shopping, compared to 60% of Baby Boomers. The same report found that nearly half of Gen Z respondents said AI made their experience better, while only 7% of Boomers said the same.  

That gap matters. It shows that AI adoption isn’t just a technology trend. It’s a generational behavior shift. 

Download the full Liveops 2025 holiday AI and customer service report

Gen Z expects AI to make service easier 

Gen Z has grown up with digital tools that move quickly, personalize experiences, and reduce unnecessary steps. They don’t want to wait on hold for simple questions. They don’t want to repeat information across channels. They don’t want to search endlessly for a return policy, appointment update, account answer, or delivery status. 

They expect service to be available, responsive, and connected. 

Salesforce research found that younger consumers are more open to AI agents than older generations, with Gen Z and millennials more willing to use AI agents to improve the customer experience. The same research found that 43% of Gen Z and millennial consumers say AI raises the bar for customer experiences, compared to 32% of Baby Boomers.  

That doesn’t mean Gen Z wants every interaction to be automated. It means they expect AI to remove friction. When AI works well, it gives customers faster access to answers, smoother self-service, and fewer repetitive steps. When it doesn’t, it can make the experience feel more frustrating than before. 

Retail is the proving ground, but every industry should pay attention 

Retail is often where customer expectations become visible first. During peak shopping seasons, consumers interact with AI through chatbots, delivery updates, self-service returns, automated emails, virtual assistants, product recommendations, and online help centers. 

The Liveops holiday AI report found that 78% of shoppers interacted with AI or automation during the 2025 holiday season, and 73% said they used it more often than in the previous year. Consumers reported the biggest increase in automation through online chat and website help, followed by customer service phone lines and automated communications.  

For retailers, this creates a clear mandate: AI can’t just be present. It has to be useful. 

But this lesson applies across industries.  

• Healthcare members want faster answers about appointments, coverage, transportation, and care navigation. 

• Insurance policyholders want help with claims, billing, renewals, and urgent events. 

• Financial services customers want secure, accurate account support.  

• Travel and hospitality customers want real-time updates when plans change. 

Gen Z’s expectations may be shaping the conversation, but the broader customer service takeaway is universal: customers want less effort, more clarity, and better outcomes. 

The human touch still matters 

Gen Z may be highly comfortable with AI, but that doesn’t mean they want human support removed from the experience. 

In fact, research points to a more nuanced reality. Five9’s customer experience research found that Gen Z is highly likely to try self-service first, with 94% attempting to solve issues online before contacting support. But the same research found that 47% of Gen Z still prefer phone support for urgent or sensitive customer service issues.  

That’s the balance brands need to understand. 

AI is valuable when it handles simple, repetitive, or transactional needs. It can help with order tracking, FAQs, appointment reminders, return steps, identity verification, routing, summarization, and status updates. But when the issue is emotional, complex, high-value, or urgent, customers still want reassurance from a person who can listen, understand context, and take accountability. 

The strongest service models won’t force customers into one path. They’ll use AI to clear the path, then bring in human support when the moment requires judgment, empathy, or deeper problem-solving. 

Transparency is becoming part of trust 

Gen Z may be more comfortable using AI, but comfort doesn’t erase the need for transparency. 

The Liveops holiday AI report found that only 22% of respondents said companies clearly disclosed when AI was being used, while 69% said brands should always reveal when customers are interacting with AI.  

Salesforce research also found that nearly 75% of consumers want to know when they’re communicating with an AI agent. It also found that consumers are more likely to use AI when there’s a clear escalation path and when the logic behind AI decisions is explained.  

For brands, this is critical. AI should never make customers feel tricked, trapped, or unsure of who or what they’re engaging with. Clear disclosure, simple handoffs, and visible options for human support can help build confidence across every generation. 

That’s especially important in regulated or sensitive industries, where accuracy, privacy, compliance, and accountability matter just as much as speed. 

Gen Z is changing what “good service” means 

For years, customer service was often measured by access.  

• Could the customer reach someone?  

• Could they get an answer?  

• Could the issue be resolved? 

Those fundamentals still matter, but Gen Z is expanding the definition of good service. 

Good service now means: 

• It feels effortless. 

• It remembers context. 

• It moves quickly. 

• It works across channels. 

• It’s transparent about AI. 

• It offers human support when needed. 

• It solves the issue without making the customer start over. 

For brands, the message is clear: AI is no longer just an operational efficiency tool. It’s becoming part of the customer experience itself. 

What this means for brands 

The future of customer service won’t be defined by whether companies use AI. It’ll be defined by how well they use it. 

Gen Z’s adoption of AI shows that customers are ready for more intelligent service experiences. But the broader data also shows that customers don’t want automation for automation’s sake. They want AI that’s accurate, helpful, transparent, and connected to real support when it matters. 

That means brands need to design AI around outcomes, not just cost savings. The goal shouldn’t be to remove people from customer service. It should be to reduce friction, improve consistency, and help support teams focus on the moments where human judgment creates the most value. 

McKinsey has noted that Gen Z’s influence, combined with generative AI, is pushing contact center leaders to rethink customer care strategies, improve service, reduce costs, and build more cohesive support models.  

That’s the real opportunity: pairing AI efficiency with human understanding. 

The next generation of customer service is hybrid 

Gen Z may be leading AI adoption, but they’re also exposing the weaknesses of poorly designed automation. They’ll use AI when it helps. They’ll abandon it when it creates more work. And they’ll expect human support when the situation calls for empathy, urgency, or accountability. 

• For retail, this may show up during peak season when customers need fast answers about orders, returns, and delivery issues.  

• For healthcare, it may show up when members need clarity and reassurance.  

• For insurance, it may show up during claims or catastrophic events.  

• For financial services, it may show up when security and trust are on the line. 

Across every industry, the winning formula is the same: use AI to make service faster and easier, but keep people at the center of the moments that matter most. 

Gen Z isn’t asking brands to choose between AI and human support. They’re showing brands how to blend both. 

And as this generation continues to shape customer expectations, companies that build service experiences around speed, transparency, personalization, and trust will be best positioned to earn loyalty in the AI-powered era of customer service. 

How Liveops can help 

Liveops helps brands bring AI and human support together in ways that improve speed, consistency, and customer trust.  

With intelligent solutions like LiveNexus™ and a proven network of skilled agents, Liveops helps organizations reduce friction, support demand swings, and deliver more responsive customer experiences across industries. 

Ready to build customer service experiences that meet the expectations of every generation?  

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