In a world where understanding customer needs can make or break a business, Natural Language Processing (NLP) has emerged as a game-changing technology.
By uncovering actionable insights from human language, NLP is empowering businesses to personalise experiences, drive innovation, and stay ahead in a competitive market.
This article explores how Large Language Models (LLMs) and Small Language Models (SLMs) are leading the charge in changing customer insights, with an eye on what’s next for 2025 and beyond.
NLP is an application of text analysis that allows businesses to extract deep customer insights, fostering innovation and personalised engagement globally.
While extensively developed in academia and integrated into numerous social media monitoring tools, at times SMEs do not understand that with a bit of help, they could create their own analytics toolbox.
SMEs can leverage NLP without the need for costly social media monitoring tools, which often come with rising fees.
What does NLP allow us to do? It allows us to easily bridge the gap between what customers say and what we, businesses, do. NLP has revolutionised how companies interact with, understand, and anticipate customer needs. Nevertheless, it is important to also comprehend how it is expanding and evolving.
How LLMs Are Altering Businesses
LLMs, like OpenAI’s GPT-4, are massive AI models trained on billions of data points.
They’ve become the backbone of versatile tools that can undertake multiple tasks:
- Streamline Customer Support: LLMs enable intelligent chatbots capable of handling everything from routine inquiries to complex customer problems with empathy and precision. During a recent event in Edinburgh, participants highlighted a common trend: AI support in customer-business engagement. While some view this as a potential issue, the truth is that intelligent chatbots allow SMEs to focus more on growth, strategy, and operational optimisation. At NorthStar, we recommend incorporating the human element after initial interactions with chatbots. However, this intelligent automation has significantly reduced personnel costs and efficiently resolved quick queries that arise in the daily running of a business.
- Power Hyper-Personalised Marketing: With deep customer profiling, LLMs help craft tailored marketing messages that boost engagement and conversions. We have talked about systems that incorporate these LLMs and how they can be used in marketing and it is only natural that things will continue to improve.
- Turn Feedback Into Gold: These models analyse vast customer feedback, highlighting trends and actionable insights to refine products and services.
SLMs: The Power of Going Small and Specific
While LLMs shine in general-purpose applications, SLMs are designed for precision in specialised -vertical- fields. These smaller models deliver targeted solutions without the computational overhead of their larger counterparts.
Here’s how SLMs are reshaping key industries:
- Healthcare: By analysing patient communication and medical records, SLMs assist in diagnostics and personalised treatment plans.
- Finance: SLMs detect fraud, analyse sentiment in investor communications, and predict market trends.
- Retail: From predicting stock levels to driving personalised recommendations, SLMs ensure businesses are aligned with customer needs.
What’s Next for NLP: Trends to Watch in 2025 and Beyond
As NLP continues to evolve, here are the trends that will define its future:
- Multimodal AI Models
Future models are already combining text, audio, and visual data for richer insights. Imagine a retail scenario where NLP integrates customer speech, tone, and facial expressions to deliver the ultimate personalized experience.
- Multimodal AI Models
- Federated Learning for Privacy
Advanced models will use federated learning, allowing businesses to train on decentralized data while adhering to privacy regulations like GDPR.
- Federated Learning for Privacy
- Sustainable AI
With growing concerns over energy consumption, smaller, optimized models will dominate, providing scalable solutions for businesses of all sizes.
- Sustainable AI
The NLP Advantage: Sentiment Analysis in Action
One of the most immediate applications of NLP is sentiment analysis—a technique that deciphers customer emotions, opinions, and preferences.
Recent advancements, like the VADER model (Barik & Misra, 2024), show how NLP can pinpoint customer pain points, inspire innovation, and improve retention.
Models such as these combine machine learning techniques like TF-IDF and WordNet Lemmatization to deliver unparalleled accuracy.
For businesses, this means proactively addressing recurring issues in customer feedback, innovating based on what customers truly desire, and retaining at-risk customers by identifying early warning signs in feedback.
Overcoming Challenges in NLP
No technology is without its limitations.
Natural Language Processing (NLP) offers transformative potential. However, it must address challenges like domain-specific ambiguities, where sentiment orientation can vary drastically between industries, requiring precise calibration.
Additionally, ethical concerns, including transparency in data usage, are crucial to maintaining trust and avoiding manipulative practices. By focusing on ethical AI practices and embracing domain-specific adaptations, businesses can maximize the value of NLP while mitigating risks.
NLP is not just a tool—it’s a strategy for businesses aiming to thrive in a customer-first era. By leveraging the versatility of LLMs and the precision of SLMs, companies can unlock personalisation and innovation.
As we look to 2025 and beyond, NLP will continue to redefine how businesses engage with their customers, offering solutions that are not only smarter but also more human. Embracing these advancements will enable businesses to stay ahead of the curve, ensuring they meet and exceed customer expectations in an ever-evolving digital landscape.
Final Thoughts
Whether one is exploring Large Language Models for scalability or Small Language Models for niche applications, the possibilities with Natural Language Processing (NLP) are indeed boundless. However, the true key to success lies in harmonising cutting-edge technology with ethical, customer-centric practices.
Here at NorthStar Consulting, we specialise in deciphering large and diverse sets of information and feedback, including social media listening.
By amalgamating these insights, we assist you in comprehending how customers perceive your brand, products, services and the broader industry landscape.
Ensure your business remains at the forefront in a world driven by data, empathy, and innovation. With our guidance, you can unlock unparalleled levels of insight, personalisation, and innovation, ensuring you meet and exceed customer expectations in an ever-evolving digital landscape.
