Zendesk’s Customer Experience (CX) Trends Report Reveals AI’s Role in Reshaping Omnichannel Marketing Strategies

Zendesk, Inc. has released the company’s latest global Customer Experience (CX) Trends Report, revealing immersive experiences are fast becoming a key differentiator for brands to stay competitive and to ensure customers remain loyal. As the economic downturn persists across the Asia Pacific region, 68% of leaders agree that strengthening business resilience through customer service becomes a top priority.

As customer expectations continue to rise, businesses will need to redefine their CX strategy and how they engage with customers – especially as new standards emerge, such as immersive CX. This change stems from what people are increasingly demanding of brands today: that they meet them where they are, under their terms, and through seamless and engaging interactions. Over the past several years, leaders have recognized how this transformation has required the role of CX to expand, prompting them to make major investments to meet those customer demands.

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“Customers have high expectations, less patience and more options when it comes to who they do business with,” said Adrian McDermott, Chief Technology Officer at Zendesk. “This year, our CX Trends shows that this shift in behavior has prompted leaders to invest in technology that creates an immersive, yet seamless experience. These new standards of customer service are critical to boosting customer acquisition and loyalty, as well as profitability.”

“As we anticipate economic downturns, shrinking budgets, and rising costs, businesses will need to be strategic when investing in technology and growth,” said Yew Hwee Ng, Senior Vice President, Asia, Zendesk. “Embracing changing customer expectations is a must to stay ahead for APAC businesses, and investing in solutions that provide a more immersive experience will drive positive ROI, ultimately achieving more with less.”

The 2023 Zendesk CX Trends Report consists of data from nearly 3,700 customers and over 4,700 customer service and experience leaders, agents, and technology buyers from 20 countries, as well as Zendesk Benchmark product usage data from nearly 100,000 Zendesk customers worldwide, ranging from small business to enterprises.

This year’s key findings in Customer Experience (CX) Trends Report highlight that Artificial Intelligence (AI), conversational experiences, personalisation, customer well-being and sentiment, and integrated teams are the critical components that businesses need to deliver immersive experiences, which will shape the future of CX.

Customers want (and expect) AI to evolve

Increased investment in AI has meant customers have become more comfortable with its presence, as chatbot interactions become increasingly commonplace.

In APAC, 64% of businesses surveyed indicated that the performance of AI & chatbots has increased significantly over the past 12 months, and that they are becoming more natural & human-like. However, only 16% of Singaporean businesses have indicated AI and chatbot integration as one of their top operational priorities.

Customers today have clear ideas about how AI should evolve, and as they enjoy richer experiences with bots, their expectations have also risen – 73% of consumers in APAC want bots to provide the same level of service as humans. The ideal evolution of AI should enable businesses to handle multiple complex questions in customer interactions, and eventually integrate voice-based AI and synthetic agents into their CX offerings.

“It’s evident customers have a grasp of what the future of AI-driven customer service will look like, with their issues being resolved in ways that are nearly identical to human support,” said McDermott. “We know businesses are working to make it better, but there is a growing realization that meeting customers’ expectations will require a more concerted effort. They are not willing to wait for companies to make gradual changes, a signal to businesses that change needs to happen fast.”

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Conversational experiences empower customers  

Customers are driving the rise of conversational experiences, with the desire for more fluid, friendly and natural interactions that put them in control and do not interrupt current tasks.

For example, if a customer stops an interaction, they expect a new support representative to be able to easily pick up where the conversation last ended. In fact, 72% of consumers in APAC spend more with companies that provide a seamless, omnichannel experience across all points of contact. Similarly, 70% of APAC consumers said they would be likely to spend more on companies that allow them to start conversations on one channel and pick it up on another without the need to repeat themselves.

While customer expectations could not be clearer, businesses are still playing catch-up. In APAC, 63% of leaders have yet to implement conversational customer service, although they intend to.

Additionally, 65% of APAC leaders – and 73% of leaders in Singapore – are rethinking the entire customer journey to build a more fluid experience to empower customers in any way they need at any time.

Customers are eager for deeper personalization

Many businesses still hold a narrow view of what personalization means and how to deliver it, which is at odds with what customers believe it to be. According to the Customer Experience (CX) Trends Report, customer expectations of personalization runs deeper and is more advanced than most businesses realize.

In fact, 67% of APAC consumers feel most companies could be doing a better job personalizing their experiences online, and deeper personalization leads to long-lasting customer relationships, according to 75%  of business leaders in Singapore who agree.

Customer well-being and sentiment are reshaping CX

Unfortunately, businesses still struggle to understand customer emotions, and many have made efforts to improve customer well-being without much payoff. For example, 69% of customer service agents in APAC say their organisation’s overall CX often causes customers to behave in negative ways. In particular, companies have not made strides in tracking emotional data in a more formal way, with only 24% of leaders and managers in APAC saying that customer sentiment is used to personalize the experience a customer receives. In Singapore, more than half (59%) of business leaders have indicated that they are not collecting enough customer data to personalize the customer experience, a sign that there are still gaps to be addressed.

A negative experience with a company can cause real, lasting damage to customer relations, with 73% of customers in APAC stating they would switch to a competitor after multiple bad experiences. Three in five (60%) will look elsewhere after one unsatisfactory interaction.

The road ahead for CX

CX leaders have become increasingly aware of the benefits of creating immersive experiences, and recognize that support functions are capable of driving revenue through customer data and feedback. In APAC however, businesses are slow to react – with only 19% of business leaders indicating their organization was excellent in sharing customer data across teams. In Singapore, only 16% of business leaders are developing a single view of customer data, and only 26% have indicated data-driven decision making as an operational priority.

As budgets across the region shrink, businesses will need to change the way they think about CX, and rethink the role customer service plays as a revenue driver. Most businesses are already embracing this shift – 70% of leaders in APAC who view their service departments as cost centers say their service department could be a revenue driver, and 61% of business leaders in APAC have plans to merge teams and responsibilities around CX.

“As we look ahead, providing excellent customer service will become even more important to build resilience and manage uncertainty,” said McDermott. “The brands that invest in technology to provide a seamless, immersive CX will see a boost in customer acquisition and loyalty, and ultimately profitability.”

Methodology

Data in this report comes from one survey of customers, one survey of business respondents, and Zendesk Benchmark product usage data. Zendesk surveyed nearly 3,700 customers and over 4,700 customer service and experience leaders, agents, and technology buyers from 20 countries and organizations ranging from small business to enterprise during July and August 2022. Results from each survey were weighted to remove bias from the survey samples.

Zendesk Benchmark product usage data came from nearly 100,000 Zendesk customers worldwide who participate in the Zendesk Benchmark. Account activity criteria were applied to filter out data from inactive accounts. Zendesk Benchmark data is based on product usage from July 2021 to July 2022.