How Companies Can Keep Up as Generative AI Changes Customer Behaviour

Nov 12, 2024 | min read

Solange Sobral

As technology evolves, so does how customers interact with brands, underpinning the urgency for organisations to understand the shift in customer expectations. Nearly three-quarters of consumers now expect personalised experiences, according to a survey by Twilio. And when those expectations aren’t met? A hefty 76% of people feel frustrated.

This is all due to the rise of AI tools, which let consumers dive into intelligent, context-aware communication. Thanks to Generative AI, customers can now do more nuanced searches that lead to better, more informed decisions. As these capabilities grow, so does the competition, making it crucial for brands to keep up with shifting expectations and really get in sync with their customers’ changing mindsets.

From Products to Experiences: A New Focus

The game is shifting from selling products to offering experiences and services. According to McKinsey, brands that nail personalisation can see revenue bumps of up to 40%. This shows that consumers aren’t just after products anymore—they want experiences that match their individual lifestyles and values.

To do this, brands need to connect with customers on a personal level to build loyalty, leveraging technology to learn more about their customers and give them a more personalised experience.

The Future of Engagement: Conversational and Aggregated Services

Conversational AI is also contributing to a more personalised experience for consumers, making customer interactions more engaging and human-like. In a Contentsquare study, over 2,700 brand marketers pointed to AI-driven conversational tools as a critical trend for 2024. This technology goes beyond chatbots—think voice-activated systems and AI customer service platforms that provide real-time communication.

The focus is moving towards creating integrated service ecosystems instead of standalone products. Companies like Amazon and Google are leading the way by using conversational AI to build comprehensive platforms that bundle functionalities like shopping and information retrieval into a single user-friendly experience. This approach is about anticipating customer needs and delivering seamless, enjoyable experiences.

Redefining Product Development Through AI Insights

AI-powered data analytics also impacts how companies grasp and respond to customer needs. With machine learning algorithms, brands can sift through large datasets to spot trends and patterns. This means they can tweak their products and marketing strategies based on real-time insights.

The Twilio Segment report highlights that businesses using advanced analytics often see higher customer engagement and satisfaction. For example, predictive analytics can help forecast customer preferences, allowing brands to be proactive in their offerings. This data-driven approach is essential for developing a product lifecycle around customer feedback.

Generative AI Must be Embedded in the Strategy, Operations and Leadership

More than ever, customer centricity must be a priority. Companies need to be able to constantly pivot based on customers’ changing preferences and the emergence of new competitor offerings. Fortunately, leveraging AI to streamline decisions for consumers and organisations is easier than ever.

Generative AI is paving the way for the next phase of digital transformation. To successfully navigate this journey, companies must be ready to adapt quickly. AI must be deeply integrated into their strategies and operations. Leadership should cultivate a culture of rapid learning, which will be crucial for progress. An agile approach, a data-driven mindset, and the willingness to experiment with new ideas will be essential to success.

A New Era of Customer-Centric Innovation

In the coming years, the most successful brands will be the customer-centric ones. These brands will make understanding customer needs, expectations, and behaviours a core part of their strategy, personalising every aspect of the customer journey.

Embracing hyper-personalisation, conversational interfaces, and data-driven insights is essential—not merely as trends but as vital elements of customer engagement. Companies that lack the courage to take these risks may be left behind.