Overview

The State of Customer Engagement Report

2024 state of customer engagement report

Overview

AI has proved it’s here to stay. In 2023, advancements in predictive and generative AI (hello, ChatGPT) carved a clear path for intelligent customer engagement. Now, brands can ditch the age-old method of one-to-many personalization and deliver unique experiences for every single customer. 

Say a customer makes a purchase from a targeted ad, only to order the wrong size. Upon calling support, the customer is greeted by a virtual agent who anticipates they’re calling about their recent purchase. The agent then guides the customer through the return process, suggests a better size, and promptly ships a replacement. Post-delivery, the customer receives a message on their preferred channel asking if the new item was a better fit, plus product recommendations based on their purchase history. 

This is the future of customer engagement for brands that embrace AI. We’re calling this the age of individualization.

To understand how brands are adopting AI to offer fully connected experiences—and how customers are responding—we surveyed business leaders and consumers from across the world. In our 2024 State of Customer Engagement Report, we examine the strategies brands are using to speak directly to their customers one-to-one, explore key trends, share global and generational statistics, and offer actionable insights on how businesses can stay competitive.

of brands say they have a deep understanding of their customers; less than half (46%) of global customers agree

Methodology

Respondents span 18 different countries, including Australia, Brazil, Chile, Colombia, France, Germany, Hong Kong, India, Indonesia, Italy, Japan, Malaysia, Mexico, Philippines, Singapore, Spain, the United Kingdom, and the United States.

How brands are getting engagement right

In order to identify businesses with advanced customer engagement and draw insights from their success, we assigned each of our surveyed brands a Customer Engagement Maturity Score. 

Based on this score, we then categorized them into one of three distinct groups: low-maturity brands, medium-maturity brands, and high-maturity brands—which we’ve labeled Engagement Leaders. Of the 4,750 businesses surveyed, 17% were deemed Engagement Leaders. 

These high-maturity brands are ahead of the pack when it comes to providing omnichannel engagement, personalizing customer experiences, and embracing first-party data.

 

The Customer Engagement Maturity Score is based on three factors:

  • Computer with bar graph
    Level of digitization

    What percentage of your customer engagement is currently digital?

  • User with a heart symbol
    Frequency of personalization

    How frequently does your brand personalize customer engagement?

  • Target symbol with envelope in the middle
    Type of customer data relied on for marketing strategy

    What kind of customer data does your marketing strategy rely on?

Brands getting engagement right

On average, Engagement Leaders:

Report 82% or more of their customer engagement is digital

Personalize customer engagement 70% of the time

Rely primarily on first-party data for their marketing strategy

Engagement Leaders are also almost five times more likely to ‘strongly agree’ they have the necessary data to understand their customers and more likely to leverage AI in their CRMs, communications platform as a service (CPaaS), contact centers, and customer engagement platforms (CEPs). And, these strategic investments seem to be paying off.

These trailblazing brands saw an average revenue increase of 123% in 2023 due to their investments in customer engagement, compared to just 30% for low-maturity brands. 

They also saw higher customer retention rates (77% vs. just 43% for low-maturity brands) and project a 16% average increase in 2024.

How digital investments boosted brand revenue in 2023

Brands predict digital engagement investments will surge by 2027

And because Engagement Leaders recognize digital engagement is the future, they’re increasing their investment in it today. In fact, 94% of Engagement Leaders say personalizing customer engagement is a high or critical priority in 2024 and they expect their investment in digital customer engagement to increase 133% by 2027.

With the right tools in their tech stack and the help of AI, these leading brands are well positioned to meet and even exceed rising customer personalization and engagement expectations.

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