Businesses are successfully using artificial intelligence (AI) to power more personalised, intelligent interactions with their customers, but face challenges around transparency and lack of customer data, according to new research from Twilio.
The report is based on a global survey across 18 countries, including Singapore, of more than 4,750 business-to-consumer (B2C) executives and 6,300 consumers.
Twilio said the report issues a clear warning about the risks of underestimating consumers’ demand for transparency. While 96% of Singapore brands say they are transparent with customers about how AI uses their data, only 48% of customers think likewise.
“Privacy-first measures have to be baked into every stage of implementation when brands use AI,” said Liz Adeniji, area VP for Asia Pacific & Japan at Twilio Segment.
“With the growing adoption of AI in this region, transparency around data usage is not optional, but a critical component of building customer trust and loyalty,” said Adeniji.
In Singapore, 47% of businesses surveyed report that finding a balance between security and customer experience is their most pressing challenge this year. One particular area of focus for brands is reducing friction during the account signup process while keeping customer data safe.
In 2024, 41% of brands in Singapore say they are prioritising simplifying the signup and login process to improve customer engagement.
Twilio said that when a company is intentional about safeguarding information while maintaining the right amount of friction to keep out bad actors, whether through user or two-factor authentication, it fosters mutual trust.
Also, the report uncovered a wide customer experience gap — 82% of Singapore businesses say they provide “good” or “excellent” customer engagement, yet only 62% of consumers agree.
The report also found AI is helping businesses to close this gap and improve their customer engagement. For example, seven in 10 companies globally already leverage AI to personalise content and marketing.
In Singapore, brands are realising a number of benefits, including higher customer satisfaction scores (48% of companies), improved market segmentation and targeting (43%), and increased cross-selling and upselling opportunities (41%).
As more businesses embrace AI, headway has been made in activating customer data. Over half (51%) of Singapore brands shared that they have the data they need to understand their customers, and 64% of local businesses agree they have a comprehensive profile of their customers.
When companies leverage AI for enhanced customer engagement, 52% of consumers in Singapore are willing to spend more with them compared to brands that do not.
