Dive Brief:
- Three-quarters of CX leaders worldwide expect their budgets to match or exceed inflation in the next 12 months, according to a report by Forrester released last month.
- Nearly 2 in 5 expect their budgets to exceed inflation, including many in India and the United States, with most predicting a 5% to 10% increase.
- Leaders in retail and wholesale, professional and technology services, media, entertainment and leisure, and hospitality expect to increase their budgets at least 5%. Industries such as manufacturing and construction, utilities and telecommunication, and financial services anticipate that their CX budgets will match inflation.
Dive Insight:
CX leaders have fought to secure their budgets amid high inflation and continue to do so amid economic uncertainty caused by a trade war. But that might change as inflation cools, CEO’s tariff concerns wane and businesses implement AI-powered CX solutions.
“Inflation of about 3% or lower in many countries is less of a threat to CX leaders’ spending power compared to the past 12 months,” according to Forrester.
Businesses plan to invest more in technology and team-led initiatives, while spending less on third-party service providers, the survey found.
Technology, initiatives and projects, data and research, and third-party service providers are each set to receive about one-quarter of CX budgets.
In addition to a shifting business and economic landscape, CX leaders “must navigate a rapidly evolving landscape of AI, data integration challenges, and complex technology stacks,” according to Forrester. “Despite the growing use of AI-powered analytics tools, CX teams still struggle to generate actionable insights without extensive manual effort.”
That’s why many are investing in the data infrastructure needed for advanced analytics and AI.
About one-third of CX leaders plan to boost investments in customer relationship management, data intelligence, business intelligence tools and customer data warehouse tech by at least 5%. Nearly 3 in 10 businesses aim to increase spending on customer feedback management by 5% or more.
They’re also changing their investments in third-party service providers, with most spending concentrated on CX strategy, analytics and customer service.
To improve their chances of success with AI-powered solutions, Forrester recommends that businesses focus their CX investments on combining fragmented datasets into one unified source and governance initiatives, AI and data literacy, digital accessibility and low-cost tactics to boost productivity, such as using AI-powered chatbots to generate insights from unstructured data stemming from customer inquiries.
These changes will require businesses to invest in new roles and staffing models, as humans handle more complex customer requests, assume supervisory roles and manage an ever-growing web of data.
