New Study Reveals Alarming Customer Experience Decline. AI is Worsening the Issue

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At a time when much has been said about how industry leaders have recognized the importance of customer experience (CX) and turned it into a competitive differentiator, CX investments have yielded good results — better customer retention and acquisition, increased sales, and stronger loyalty, a study by CCW Digital on CX trends, challenges, and opportunities revealed an unexpected trend of customer experiences regressing in the age of AI and streamlined CX processes rather than improving. 

According to the study, only 7% of consumers feel experiences have improved over the past year, and 55% feel they have worsened. Nearly 60% of consumers say they share details of bad experiences with personal contacts, while 29% actively rant about poor performance on social media. Other consumer reactions include attempting to switch providers (48%) and writing negative reviews (39%).

The study highlighted a critical insight that despite the advancements in AI, the essence of customer experience hinges on genuine human connection. It revealed that about 26% of consumers expect to reach a successful resolution using messaging. An even smaller 17% have faith in the value of a chatbot/web self-service interaction.

Furthermore, only 19% of consumers feel they can immediately access help from a human agent. Over a third of consumers will take their complaints directly to the company’s contact center.

“Technology should enhance, not replace, the empathy and responsiveness that define exceptional service. These findings are a wake-up call for businesses to harmonize technological innovation with human-centric strategies to elevate customer satisfaction and loyalty,” said Mario Matulich, President of Customer Management Practice.

The research underscores a critical reality for businesses. Despite efforts to compete on customer experience and foster a customer-centric culture, most consumers feel that their experiences have regressed over the past year. 

Alarmingly, AI, hailed as a transformative solution, is exacerbating the issue. In fact, in the eyes of the customer, the most notable mistake concerns the absence of the human touch. A staggering 52% say it is difficult to reach a live agent, establishing lack of humanity as the #1 pain point in 2024.

“In a time when AI and automation promise so much, it’s concerning that businesses are still missing the mark on delivering meaningful customer experiences. The reliance on technology without the balance of human touch has increased consumer frustration,” explained Brian Cantor, Managing Director of CCW Digital. “Truly customer-centric brands—those that design experiences from the outside-in—have a unique opportunity to improve key contact center metrics and build significant brand cachet.”

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Customer Centricity Summit, hosted by MIT Sloan Management Review Middle East, will take place on September 18th-19th, 2024. It will offer a lens into the future of branding, where enduring relationships with customers are cultivated through trust, authenticity, and value. Click here to register for the Customer Centricity Summit.