Even though brands believe they're giving customers what they want, consumers aren’t so sure. The last year saw many brands turning to AI to improve their ability to build better relationships with their customers.
Many brands are actively leveraging AI, with marketing emerging as the primary use case. In fact, seven out of 10 companies say they’re already using AI to personalize content and marketing.
Also, organizations are already experiencing a substantial business impact since adopting AI, with:
As brands continue to experiment with and invest in this emerging technology, we expect AI’s business impact to keep intensifying in the coming months and years.
Perfecting personalization boosts a business' bottom line, as 55% of consumers are willing to spend more money for a customized experience. While consumers report spending an average of 36% more on brands that personalize engagement, businesses estimate they actually shell out an average of 54% more.
It can also increase customer loyalty. 48% of consumers say they’ve made a repeat purchase from a company based on the level of personalization they received.
To maximize the potential of their data and unlock these advantages, businesses should seamlessly integrate their data tools and technologies with AI. This presents a significant opportunity, considering that approximately half of businesses have yet to incorporate AI into their tools.
It is worth noting that Engagement Leaders are more likely to leverage AI in every platform than other lower-maturity brands.
Globally, brands are experiencing varying trends in AI adoption and its impact. Brazil, Colombia, India, and Italy are using AI for content and marketing personalization more than any other country—and their brands’ investments are yielding positive results. Businesses in Brazil, France, India, and Indonesia say leveraging AI has directly increased revenue. That comes as no surprise, especially since consumers in Brazil, Hong Kong, India, Indonesia, and Singapore express a greater likelihood to spend more if AI enhances customer engagement.
Moreover, brands in Brazil, Chile, Indonesia, and Italy stand out for already integrating AI within their CEP tools, reflecting a proactive approach to technology utilization.
Consumers on how their spending would change with improved AI-driven engagement
While many companies are already using AI in some capacity, we did identify a few opportunities where the technology is currently underutilized.
Although data privacy and security are leading concerns for businesses in 2024 and beyond, only 64% of companies currently use AI to help manage fraud and mitigate risk. Instances of fraud have increased significantly in the last few years, with Twilio’s State of SMS Pumping revealing that 1.1% of global SMS traffic was SMS pumping, or artificially inflated traffic, in October 2023. Exclude the US and Canada, and 5.4% of all international traffic that month was fraudulent.
Continuing to invest in AI-powered fraud detection and protection tools can help businesses prevent account compromise and safeguard user accounts. It can also help brands avoid financial losses from fraudsters creating fake accounts to abuse one-time new user promotions or from account takeovers impersonating legitimate users. By staying ahead of emerging threats, organizations can protect both their assets and the trust of their valued customers.
While an impressive 64% of companies use AI to build a unified view of every customer, work remains to be done. In a time when understanding customers is paramount to success, this is a significant opportunity for brands, especially since AI can be used to combine data from multiple sources, standardize data formats, fill in missing values, reconcile inconsistent data, and deduplicate information.
Once your customer profiles have been created, AI can also help your brand:
Summarize contact center interactions to outline caller intent, interest, and outcomes
Predict future user behaviors, like a high propensity to purchase or churn
Define lookalike audiences based on your top customers
Leveraging AI, your business can not only add important context to your customer profiles, but also help take action to deliver the right message to the right person at the right time. As a result, you can move prospects and customers further down the funnel with higher efficiency.
Finally, brands are paying for tools and technologies like customer data platforms (CDPs) and customer engagement platforms (CEPs), but only half of companies have integrated AI into these platforms. Luckily, it seems many brands have plans to add this functionality in the coming years, with 47% planning to add AI capabilities to their CDP or CEP by 2025.
If you haven’t already, consider expanding your business’s use of AI to encompass these areas and more, so you can get the most out of your customer data.
How consumers rate how well brands are personalizing engagement
Percent of consumers who would spend more for personalization
As the largest online auction website in New Zealand, Trade Me is the place to go to find a first home, launch a new business, purchase a car, and more for over 650,000 site visitors a day.
Using Twilio Predictions, Trade Me’s marketing team was able to effectively leverage flexible, out-of-the-box predictive AI models to predict buyer and seller behavior. Then, they used those predictions to run more targeted, timely, and personalized campaigns.
