AI seen as key to tackling customer churn in Australian firms

A recent study reveals that 78% of Australian businesses express concern over diminishing customer loyalty, with two-thirds (66%) citing customer churn as their primary concern. The study, commissioned by Genesys and conducted by YouGov, underscores the significant apprehension among businesses about retaining their customer base.

The survey indicates that a substantial majority (97%) of businesses are either adopting or planning to adopt artificial intelligence (AI) to enhance customer experience. Annual budgets for AI are set to increase to 15.1% in the next financial year, up from the current average of 11.1%. This underscores the growing trust in AI as a solution to the challenges of customer churn.

Three in ten respondents (31%) stated their companies were utilising or planning to implement AI for conversational chatbots. An identical proportion highlighted the use of AI for predictive analytics and digital engagement — techniques known to drive customer service excellence.

Despite the enthusiasm for AI, 95% of senior business decision-makers expressed some concerns about the technology's implementation. Cybersecurity risks topped the list of apprehensions for nearly half (46%) of those surveyed, followed by legal and regulatory issues (42%), a lack of internal AI skills (40%), and the costs associated with AI investment and implementation (40%).

Nevertheless, the potential benefits of AI seem to outweigh these concerns for many. Nine in ten senior business decision-makers (91%) reported their company had seen or expected to see an increase in customer satisfaction resulting from AI technology. Additionally, 94% of respondents from businesses using or contemplating AI anticipated improvements in first contact resolution, campaign return on investment (ROI), and a reduction in the cost to serve.

The planned increase in AI investment reflects the perceived advantages of the technology. Thirty-two percent of survey respondents cited the automation and streamlining of repetitive processes among their top three drivers for AI implementation. Nearly three in ten (28%) pointed to the improvement of quality and consistency across the customer journey, while 27% emphasised the enhancement of personalisation as a significant motivator.

It is evident that AI is becoming a critical element in the strategy of Australian businesses looking to improve customer experience and retention. Mark Buckley, Vice President of Australia and New Zealand at Genesys, noted, "The business benefits of AI technology are clear, and the latest research from Genesys showcases just how AI can change the face of customer experience and engagement. While some concerns remain about implementing AI technology, the opportunity is ripe for businesses to tap AI and the solutions that draw upon its power to transform customer experience for the better."

The YouGov survey involved 351 board-level business decision-makers and senior managers or directors below board level who are involved in customer experience in businesses with more than 100 employees. The research was conducted online between 8-15 February 2024.