Embedded with artificial empathy, artificial intelligence (AI) companions (ACs) can create, communicate, and deliver value to customers. This article analyzes current and emerging ACs in order to explore AI’s role in transforming customer journeys and establishing long-lasting customer relationships. It also identifies existing business challenges in developing user-AI companionship and offers a remedial strategy matrix. Purely functional or emotional capabilities lead to interest in the companion plummeting with time. The findings reveal the need to design holistic ACs with a hybrid of functional, emotional, and conversational capabilities to mitigate the uncanny valley problem.
