The market for AI in customer experience, often referred to as AI CX or AI in CX, encompasses the use of artificial intelligence technologies and solutions to enhance and optimize the interactions between businesses and their customers. This market includes a wide range of AI-powered applications, platforms, and tools designed to improve various aspects of the customer journey, from initial engagement to post-purchase support. These AI-driven solutions aim to provide customers with more personalized, efficient, and satisfying experiences while helping businesses streamline their operations and build lasting customer relationships.

Some of the benefits of designing a Artificial Intelligence in Customer Experience Market include:

• Personalization Advancements: AI leverages customer data to offer highly customized experiences, including tailored product suggestions and individualized marketing content, fostering a sense of being recognized and appreciated.
• Operational Efficiency: AI streamlines operations by automating routine tasks, such as responding to common customer inquiries and processing orders, lightening the workload of customer service agents.
• Round-the-Clock Support: AI-driven chatbots and virtual assistants ensure 24/7 availability for customer assistance, enabling customers to access information and support at any time, independent of time zones or business hours.
• Uniformity: AI guarantees uniform customer interactions across various communication channels, providing a seamless experience whether customers interact through a website, mobile app, social media, or phone.
• Insights Informed by Data: AI harnesses extensive datasets to furnish valuable insights into customer behaviors and preferences, guiding strategies in marketing, product development, and customer service.

Global Artificial Intelligence in Customer Experience Market was valued at US $ 9.4 Billion in 2022 and is expected to reach US $ 28 Billion by 2030 growing at a CAGR of 14.6% during the forecast period 2023 – 2030.

COVID -19 Impact

The COVID-19 pandemic has significantly impacted the AI in customer experience market by driving both its adoption and evolution. As the world grappled with the challenges of the pandemic, businesses swiftly adapted to the new normal by increasing their reliance on AI-powered solutions for customer interactions. Digital engagement became a central focus, with AI-driven chatbots, virtual assistants, and automated customer service tools stepping up to meet the surge in demand for online interactions. The need for 24/7 availability was underscored, and AI played a crucial role in ensuring continuous customer support, especially as traditional customer service representatives faced disruptions due to remote work arrangements. Contactless customer service gained prominence, with AI-driven self-service options reducing the need for physical touchpoints, aligning with safety and hygiene concerns.

Data-driven decision-making became essential as businesses navigated uncertain market dynamics, relying on AI to gain insights into shifting customer preferences and needs. Personalization emerged as a key strategy to offer comfort and convenience during challenging times, with AI tailoring content, recommendations, and support to individual customer requirements. Supply chain and inventory management were optimized through predictive analytics and AI solutions, helping businesses anticipate demand fluctuations and maintain efficient stock levels. AI provided support for remote workforces, ensuring that remote customer service representatives had access to real-time assistance and information.

In the healthcare sector, AI chatbots and virtual assistants played a critical role in delivering accurate and timely information about COVID-19, vaccination, testing, and general health queries, reducing the burden on healthcare professionals. E-commerce and online retail experienced a surge in demand, with AI-powered recommendation engines and virtual shopping assistants enhancing the online shopping experience. Digital transformation initiatives were accelerated across industries, underscoring the importance of investing in AI solutions to remain competitive in a digital-first world. The COVID-19 pandemic has not only underscored the pivotal role of AI in adapting to unprecedented challenges but has also emphasized the significance of AI in shaping the future of customer experience. AI-driven solutions have demonstrated their versatility and resilience, assisting businesses in navigating the evolving landscape while providing exceptional customer experiences in a rapidly changing environment.

Factors Driving the Market

Drivers

Surge in demand for personalized experiences

The surge in demand for personalized experiences is a pivotal factor propelling the growth of the AI in the customer experience market. In an era where customers seek unique, tailored interactions with brands, AI-driven solutions have emerged as the answer. By harnessing AI's capabilities, businesses can cater to these expectations in several ways. Personalization not only enhances customer engagement but also nurtures customer loyalty, reducing churn and increasing customer lifetime value. Higher conversion rates are an evident outcome, as AI customizes product recommendations, offers, and content to align with individual customer profiles, resulting in increased revenue. Importantly, personalized experiences lead to improved customer satisfaction, fostering a positive brand reputation and facilitating repeat business. The data-driven insights derived from personalization are invaluable for businesses, offering a deeper understanding of customer behaviors and preferences. This data, in turn, informs future marketing, product development, and customer service decisions, allowing for more targeted and effective approaches. As the competitive landscape intensifies, personalization provides a significant advantage, with businesses that excel in this area gaining a prominent edge. Furthermore, the AI-driven personalization approach facilitates cross-selling and up-selling by identifying opportunities based on customer behavior and purchase history, increasing revenue and profit margins.

Predictive analytics is another dimension of personalization. AI has the ability to forecast customer needs and behaviors by analyzing historical data, enabling businesses to proactively meet these needs and provide timely and relevant offers. Multichannel consistency is maintained through personalization, ensuring that customers receive consistent and tailored experiences across various communication channels. As the demand for personalized experiences continues to grow, AI's role in shaping the future of customer engagement is set to expand further, offering businesses an effective means to meet evolving customer expectations and foster enduring customer relationships.

Challenges

Data privacy and security

Data privacy and security considerations exert a profound influence on the market growth of AI in customer experience. In an age marked by growing apprehensions about the protection of sensitive data, the manner in which businesses address these concerns significantly impacts the adoption and acceptance of AI-driven customer interactions. Trust is paramount, and robust data protection measures can build customer confidence, encouraging them to engage more extensively with AI-driven customer experiences. Conversely, a lack of trust due to data privacy and security apprehensions can hinder market growth.

Stringent data privacy regulations, such as GDPR, have reshaped the landscape, making compliance a non-negotiable requirement. AI solutions that uphold these standards are well-positioned to operate within a global framework. The market thrives when businesses have confidence in the data protection capabilities of AI solutions. Features designed to secure customer data, such as encryption and access controls, play a central role in shaping market dynamics. AI solutions that offer these protections, while still ensuring a seamless and convenient experience, are favored by businesses and customers alike. Data breaches pose a considerable risk, both in terms of customer trust and market growth. High-profile breaches can slow AI adoption, prompting businesses to invest heavily in cybersecurity measures to mitigate these risks and reassure their customer base. Hybrid solutions, which combine cloud and on-premises infrastructure, gain traction as a response to data privacy and security concerns. The capacity to keep sensitive data on-premises for added security while harnessing AI's benefits fosters market expansion. Secure data-sharing mechanisms, including anonymization and encryption, are crucial in fostering trust and propelling market growth.

Trends

Increasing adoption of automation operational activities

The increasing adoption of automation in operational activities is rapidly propelling the AI in the customer experience market to new heights. Businesses are recognizing the transformative potential of automation, driven by artificial intelligence, in revolutionizing the way they engage with customers and streamline their operational processes. This adoption comes with a host of benefits, starting with enhanced efficiency. AI-driven systems can perform tasks with unparalleled precision and speed, resulting in quicker response times and reduced manual errors, ultimately delivering a faster, more consistent, and error-free customer service experience. Moreover, automation leads to substantial cost savings by reducing reliance on manual labor and mitigating the risks associated with human errors. Scalability is another key advantage, allowing businesses to adapt seamlessly to changing customer demands, ensuring that they can meet peak demand without overburdening their operations during quieter periods.

Furthermore, automation facilitates personalization by harnessing AI algorithms to analyze vast datasets, tailoring recommendations, product suggestions, and marketing content to individual customer preferences. This level of personalization fosters stronger customer engagement and a greater sense of being understood and valued by the brand. Automation also ensures multichannel support, offering customers the flexibility to engage with businesses through their preferred communication channels. Valuable data insights are derived from the automated processes, providing businesses with the knowledge needed to refine customer experiences, make data-driven decisions, and optimize products and services. Additionally, the ability to provide 24/7 customer support through automation caters to a global customer base with diverse time zones and schedules, meeting the expectations of modern consumers for accessibility and convenience. Ultimately, the adoption of automation in operational activities is driving substantial improvements in customer satisfaction, as businesses deliver more efficient, personalized, and readily available services. This trend underscores the growing importance of AI in shaping the future of customer experiences across various industries.

Market Segmentation

By Deployment Type

By Deployment Type, the global Artificial Intelligence in Customer Experience Market is divided into On Premise, Cloud Based, Hybrid.

Cloud-based solutions have taken the lead in the AI in customer experience market with 56.48% market share, offering scalability, accessibility, cost-efficiency, streamlined maintenance, and seamless integration. These advantages have made cloud solutions the go-to choice for businesses aiming to enhance their customer experiences and stay agile in a rapidly evolving market.

Simultaneously, hybrid solutions are emerging as the fastest-growing segment with 16.9% CAGR, owing to their unique strengths. Businesses that prioritize data privacy, security, and compliance find hybrid models appealing, allowing them to balance the advantages of the cloud with the need to keep sensitive data on-premises. Furthermore, hybrid solutions provide a gradual transition for companies with legacy systems, offering customization flexibility, and catering to specific regulatory requirements. In addition, they offer redundancy, ensuring uninterrupted customer service even in the face of network issues or cloud service disruptions. The coexistence of cloud-based and hybrid solutions in the AI-driven customer experience landscape underscores the adaptability and diversity of options available to businesses seeking to deliver exceptional customer interactions and meet their unique operational needs.

By Application

By Application, the global Artificial Intelligence in Customer Experience Market is divided into Customer service, Personalized , Predictive analytics, Sentiment analysis, Customer onboarding, Proactive issue resolution.

Customer service stands as the forefront leader in the AI in customer experience market with 28.3 % market share, primarily because it offers immediate and visible improvements, cost-efficiency, scalability, and enhanced productivity for businesses. AI-powered customer service solutions like chatbots and virtual assistants provide instant responses, handle high inquiry volumes, and allow companies to adapt swiftly to customer demands.

In parallel, personalized experiences emerge as the fastest-growing application with 18.6 % CAGR due to the evolving landscape of customer expectations. Modern consumers demand tailored interactions, and AI-driven personalization meets these expectations. By leveraging data insights, businesses can deliver content, products, and services that resonate with each individual. This approach not only boosts customer engagement and loyalty but also enhances marketing, sales, and strategic decision-making. As a result, businesses are increasingly turning to AI for personalized experiences, seeking to gain a competitive edge in an environment driven by customer-centricity. Both customer service and personalized experiences are instrumental in shaping the future of customer engagement and satisfaction.

By End-user Industries

By End-Use Industries the Artificial Intelligence in Customer Experience Market is divided by Retail, Banking and Financial Services, Healthcare, Manufacturing, Telecommunication, Travel and hospitality.

Retail holds a leading position in the AI in customer experience market with 26.5% market share, due to its innate customer-centric focus, data abundance, early adoption of AI, and the highly competitive landscape. The retail sector has embraced AI to offer personalized shopping experiences, streamline operations, and gain a competitive edge in a crowded market.

Conversely, the healthcare sector is the fastest-growing segment in AI customer experience market with 19.6% CAGR. This rapid growth is attributed to the healthcare industry's complex and sensitive data, the global aging population, increasing regulatory support, ongoing research and development, and the pivotal role of AI in pandemic response. AI is transforming healthcare by enabling personalized patient care, improving operational efficiency, and advancing medical research and diagnosis. These factors collectively contribute to the healthcare sector's rapid expansion in the AI customer experience market.

By Region

By region, the global Artificial Intelligence in Customer Experience Market is divided into North America, Europe, APAC and Others. Others is further divided into Middle East, Africa and South America.

The North America (NA) region leads with 32.4% market share in AI in customer experience market due to its early adoption of technology, mature tech ecosystem, and culture of innovation. With major tech hubs like Silicon Valley, ample venture capital, and strong government support, NA has established itself as a pioneer in AI development for enhancing customer experiences across various industries. In contrast, the Asia-Pacific (APAC) region is the fastest-growing market for AI in customer experience market with 16.8% CAGR. Its remarkable growth is propelled by the region's vast population, expanding consumer market, and rapid digital transformation. The increasing adoption of e-commerce and mobile usage, combined with government initiatives and a thriving startup ecosystem, make APAC a fertile ground for AI-driven customer experience solutions. Both regions play pivotal roles in shaping the global AI in customer experience landscape.

Competitive Landscape

The global Artificial Intelligence in Customer Experience Market is consolidated with the presence of few major players contributing to the market revenue. This dominance of these major players is driven by their technological expertise, extensive resources, and established brand recognition. These companies typically offered comprehensive and diversified solutions to end use industries.

• IBM

IBM traces its roots back to 1911 when it was established as the Computing-Tabulating-Recording Company (CTR). CTR emerged from the merger of three companies specializing in the sale of grocery store scales, time recording devices, and tabulators. The year 1924 marked a significant transformation when CTR underwent a name change, becoming known as International Business Machines, commonly referred to as IBM.

• Google

Google is a U.S.-based multinational technology firm that specializes in a wide range of Internet-related offerings and products. These encompass online advertising technologies, a renowned search engine, cloud computing solutions, software development, and hardware production. Within the American information technology sector, Google holds a prominent position as one of the Big Five technology companies, standing alongside industry giants such as Amazon, Apple, Meta (formerly Facebook), and Microsoft.

• Microsoft

Microsoft Corporation is an American multinational technology corporation that focuses on computer software, consumer electronics, personal computing devices, and associated services. It is widely recognized as one of the leading Big Five technology enterprises in the U.S. information technology sector, joining the ranks of other major players such as Amazon, Apple, Alphabet (Google), and Meta (formerly known as Facebook).

• Salesforce
• Abode
• SAP
• Oracle
• Pegasystems
• Avaya
• Genesys
• Liveperson
• Inmoment
• Medallia
• Satmetrix
• Zendesk
• Uipath
• Freshservices
• NICE
• Twilio
• Automation Anywhere

Recent Developments

• In October 2023, LivePerson, a prominent conversational commerce platform, has unveiled its most recent AI-driven chatbot, aiming to assist businesses in delivering round-the-clock customer support and enhancing customer contentment. This chatbot leverages LivePerson's Conversational AI platform, incorporating natural language processing (NLP) and machine learning (ML) to comprehend customer intentions and deliver relevant responses. Furthermore, it seamlessly integrates with LivePerson's Engagement Cloud platform, offering businesses a consolidated perspective on their customer engagements across all communication channels.
• In September 2023, Salesforce, a prominent CRM provider, has introduced its latest suite of sales and marketing automation tools powered by Einstein AI. These cutting-edge tools are crafted to assist businesses in automating repetitive tasks, optimizing workflow efficiencies, and enhancing customer engagement. Notable components of this suite encompass Einstein Activity Capture, which autonomously records customer interactions and updates Salesforce records; Einstein Sales Insights, delivering valuable insights into customer behavior and sales prospects; and Einstein Marketing Automation, automating marketing campaigns and email outreach for improved efficiency.
• In September 2023, Adobe, a prominent software company, has unveiled its most recent suite of AI-powered marketing analytics and customer journey management tools within the Experience Cloud. These cutting-edge tools are meticulously designed to empower businesses in comprehending their customer data, enhancing marketing campaign effectiveness, and delivering personalized customer experiences. The suite comprises Adobe Analytics Sensei, employing AI for the in-depth analysis of customer data and trend identification; Adobe Campaign Sensei, harnessing AI to fine-tune marketing campaigns; and Adobe Journey Optimizer, utilizing AI to adeptly oversee customer journeys across all interaction points.

Artificial Intelligence in Customer Experience Market Scope

Table of Contents

1 INTRODUCTION OF GLOBAL ARTIFICIAL INTELLIGENCE IN CUSTOMER EXPERIENCE MARKET

1.1 Overview of the Market

1.2 Scope of Report

1.3 Assumptions

2 EXECUTIVE SUMMARY

3 RESEARCH METHODOLOGY

3.1 Data Mining

3.2 Validation

3.3 Primary Interviews

3.4 List of Data Sources

4 GLOBAL ARTIFICIAL INTELLIGENCE IN CUSTOMER EXPERIENCE MARKET OUTLOOK

4.1 Overview

4.2 Market Dynamics

4.2.1 Drivers

4.2.2 Restraints

4.2.3 Opportunities

4.3 Porters Five Force Model

4.3.1. Bargaining Power of Suppliers

4.3.2. Threat of New Entrants

4.3.3. Threat of Substitutes

4.3.4. Competitive Rivalry

4.3.5. Bargaining Power among Buyers

4.4 Value Chain Analysis

5 GLOBAL ARTIFICIAL INTELLIGENCE IN CUSTOMER EXPERIENCE MARKET, BY DEPLOYMENT

5.1 Overview

5.2 On Premise

5.3 Cloud Based

5.4 Hybrid

6 GLOBAL ARTIFICIAL INTELLIGENCE IN CUSTOMER EXPERIENCE MARKET, BY APPLICATION

6.1 Overview

6.2 Customer service

6.3 Personalized

6.4 Predictive analytics

6.5 Sentiment analysis

6.6. Customer onboarding

6.7 Proactive issue resolution

7 GLOBAL ARTIFICIAL INTELLIGENCE IN CUSTOMER EXPERIENCE MARKET, BY END-USER INDUSTRY

7.1 Overview

7.2 Retail

7.3 Banking and financial services

7.4 Healthcare

7.5 Manufacturing

7.6 Telecommunication

7.7 Travel and hospitality

8 GLOBAL ARTIFICIAL INTELLIGENCE IN CUSTOMER EXPERIENCE MARKET, By REGION

8.1 North America

8.1.1 U.S.

8.1.2 Canada

8.2 Europe

8.2.1 Germany

8.2.3 U.K.

8.2.4 France

8.2.5 Rest of Europe

8.3 Asia Pacific

8.3.1 China

8.3.2 Japan

8.3.3 India

8.3.4 South Korea

8.3.5 Singapore

8.3.6 Malaysia

8.3.7 Australia

8.3.8 Thailand

8.3.9 Indonesia

8.3.10 Philippines

8.3.11 Rest of Asia Pacific

8.4 Others

8.4.1 Saudi Arabia

8.4.2 U.A.E.

8.4.3 South Africa

8.4.4 Egypt

8.4.5 Israel

8.4.6 Rest of Middle East and Africa (MEA)

8.4.7 Brazil

8.4.8 Argentina

8.4.9 Mexico

8.4.10 Rest of South America

9 COMPANY PROFILES

9.1 IBM

9.1.1. Company Overview

9.1.2. Key Executives

9.1.3. Operating Business Segments

9.1.4. Product Portfolio

9.1.5. Financial Performance (As per availability)

9.1.6 Key News

9.2 Google

9.2.1. Company Overview

9.2.2. Key Executives

9.2.3. Operating Business Segments

9.2.4. Product Portfolio

9.2.5. Financial Performance (As per availability)

9.2.6. Key News

9.3 Microsoft

9.3.1. Company Overview

9.3.2. Key Executives

9.3.3. Operating Business Segments

9.3.4. Product Portfolio

9.3.5. Financial Performance (As per availability)

9.3.6. Key News

9.4  Salesforce

9.4.1. Company Overview

9.4.2. Key Executives

9.4.3. Operating Business Segments

9.4.4. Product Portfolio

9.4.5. Financial Performance (As per availability)

9.4.6. Key News

9.5 Adobe

9.5.1. Company Overview

9.5.2. Key Executives

9.5.3. Operating Business Segments

9.5.4. Product Portfolio

9.5.5. Financial Performance (As per availability)

9.5.6. Key News

9.6 SAP

9.6.1. Company Overview

9.6.2. Key Executives

9.6.3. Operating Business Segments

9.6.4. Product Portfolio

9.6.5. Financial Performance (As per availability)

9.6.6. Key News

9.7 Pegasystems

9.7.1. Company Overview

9.7.2. Key Executives

9.7.3. Operating Business Segments

9.7.4. Product Portfolio

9.7.5. Financial Performance (As per availability)

9.7.6. Key News

9.8 Oracle

9.8.1. Company Overview

9.8.2. Key Executives

9.8.3. Operating Business Segments

9.8.4. Product Portfolio

9.8.5. Financial Performance (As per availability)

9.8.6. Key News

9.9 Avaya

9.9.1. Company Overview

9.9.2. Key Executives

9.9.3. Operating Business Segments

9.9.4. Product Portfolio

9.9.5. Financial Performance (As per availability)

9.9.6. Key News

9.10 Geneysy

9.10.1. Company Overview

9.10.2. Key Executives

9.10.3. Operating Business Segments

9.10.4. Product Portfolio

9.10.5. Financial Performance (As per availability)

9.10.6. Key News

9.11 Liveperson

9.11.1. Company Overview

9.11.2. Key Executives

9.11.3. Operating Business Segments

9.11.4. Product Portfolio

9.11.5. Financial Performance (As per availability)

9.11.6. Key News

9.12 Inmoment

9.12.1. Company Overview

9.12.2. Key Executives

9.12.3. Operating Business Segments

9.12.4. Product Portfolio

9.12.5. Financial Performance (As per availability)

9.12.6. Key News

9.13 Medallia

9.13.1. Company Overview

9.13.2. Key Executives

9.13.3. Operating Business Segments

9.13.4. Product Portfolio

9.13.5. Financial Performance (As per availability)

9.13.6. Key News

9.14  SatMetrix

9.14.1. Company Overview

9.14.2. Key Executives

9.14.3. Operating Business Segments

9.14.4. Product Portfolio

9.14.5. Financial Performance (As per availability)

9.14.6. Key News

9.15 Zendesk

9.15.1. Company Overview

9.15.2. Key Executives

9.15.3. Operating Business Segments

9.15.4. Product Portfolio

9.15.5. Financial Performance (As per availability)

9.15.6. Key News

9.16 Freshservice

9.16.1. Company Overview

9.16.2. Key Executives

9.16.3. Operating Business Segments

9.16.4. Product Portfolio

9.16.5. Financial Performance (As per availability)

9.16.6. Key News

9.17 Uipath

9.17.1. Company Overview

9.17.2. Key Executives

9.17.3. Operating Business Segments

9.17.4. Product Portfolio

9.17.5. Financial Performance (As per availability)

9.17.6. Key News

9.18 Automation Anywhere

9.18.1. Company Overview

9.18.2. Key Executives

9.18.3. Operating Business Segments

9.18.4. Product Portfolio

9.18.5. Financial Performance (As per availability)

9.18.6. Key News

9.19 NICE

9.19.1. Company Overview

9.19.2. Key Executives

9.19.3. Operating Business Segments

9.19.4. Product Portfolio

9.19.5. Financial Performance (As per availability)

9.19.6. Key News

9.20 Twilio

9.20.1. Company Overview

9.20.2. Key Executives

9.20.3. Operating Business Segments

9.20.4. Product Portfolio

9.20.5. Financial Performance (As per availability)

9.20.6. Key News

Global Artificial Intelligence in Customer Experience Market Segmentation

Artificial Intelligence in Customer Experience by Deployment Type: Market Size & Forecast 2023-2030

• On premise
• Cloud Based
• Hybrid

Artificial Intelligence in Customer Experience by Application: Market Size & Forecast 2023-2030

• Customer service
• Personalized
• Predictive analytics
• Sentiment analysis
• Customer onboarding
• Proactive issue resolution

Artificial Intelligence in Customer Experience by End Use Industry: Market Size & Forecast 2023-2030

• Retail
• Banking and Financial
• Healthcare
• Manufacturing
• Telecommunications
• Travel and Hospitality

Artificial Intelligence in Customer Experience by Geography: Market Size & Forecast 2023-2030

• North America (USA, Canada, Mexico)
• Europe (Germany, UK, France, Russia, Italy, Rest of Europe)
• Asia-Pacific (China, Japan, South Korea, India, Southeast Asia, Rest of Asia-Pacific)
• South America (Brazil, Argentina, Columbia, Rest of South America)
• Middle East and Africa (Saudi Arabia, UAE, Egypt, Nigeria, South Africa, Rest of MEA)

Major Players:

• IBM
• Google
• Microsoft
• Salesforce
• Abode
• SAP
• Oracle
• Pegasystems
• Avaya
• Genesys
• Liveperson
• Inmoment
• Medallia
• Satmetrix
• Zendesk
• Uipath
• Freshservices
• NICE
• Twilio
• Automation Anywhere