What you need to know:

• The new Adobe State of Digital CX report has shown Australian businesses lagging behind in AI adoption for CX globally: 6 per cent versus 18 per cent. This is despite a strong appetite for AI adoption.
• Only 3 per cent of organisations have completed usage governance for AI in CX.
• Australian organisations have nevertheless been doubling down on CX as a priority and 85 per cent remain focused on prioritising CX enhancements over other business goals.
• Executives from FIFA World Cup and Tribal DDB Group suggest trust issues are battling cautious optimism when it comes to AI as a tool for better experiences, productivity and workflow.
• Customer concerns about data transparency and usage are also playing a role in AI in CX.

Not enough trust in AI technology, data governance fears and a lack of true insight into how AI practically solves business and creativity problems are all playing their part in why Australia’s trailing global peers in adopting AI for CX.

So believe a panel of leadership and marketing executives from Tribal DDB Group, FIFA Women’s World Cup and Adobe, who spoke at an Adobe media event exploring where AI is perceived to have value for their organisations, as well as what’s holding companies back from going gung-ho into AI investment.  

Adobe’s latest State of Digital Customer Experience Report, released Friday, revealed only 6 per cent of ANZ brands are using generative AI to enhance CX, versus 18 per cent globally.

The report, produced in partnership with Oxford Economics, surveyed B2B and B2C industry executives plus consumers across Australia and New Zealand along with 12 other countries including the US, UK, Germany, Japan, Singapore, India, Thailand and Malaysia. In all, 1,500 executives and 4,000 customers participated including more than 200 customers and 75 executives in ANZ.

Adobe’s figures showed ANZ businesses are also half as likely to have AI budgets as their US counterparts. What’s more, only 3 per cent have completed work on CX usage policies for gen AI locally, compared to 10 per cent globally.

A similar warning on Australia’s lagging position in AI was put out by the OECD earlier this year, which showed Australian businesses are ranked 13th of 14 leading economies for AI deployment based on Gross Domestic Expenditure on R&D as percentage of GDP in 2022.

This is even as estimates from Deloitte Access Economics show over a quarter of Australia’s economy, or nearly $600 billion in economic activity, is set to be rapidly disrupted by gen AI including finance, ICT and media, professional services, education and wholesale trade.

Yet AI appetite is there: 64 per cent of ANZ businesses expect to leverage AI for CX within the next 12 months.  

Gen AI blockers

A potential contributor to AI lag is immature governance and usage policies. Adobe Digital Experience Business CMO, Eric Hall, isn’t surprised usage policies haven’t caught up given how quickly gen AI is moving and said governments and corporates are still unpacking it.

“Businesses need to worry about the commercial viability and safety of anything they use with AI. That’s an issue that needs to be addressed,” he said. “That is where a lot of the issues come from: Do you know the data models AI has been trained on? If it was scraped off the Internet, you may not be dealing with things that are commercially safe or allowable,” Hall said. “Governments and businesses need to face into these issues.”

Commercial safeguarding is something Adobe is taking seriously as it brings AI capability into its digital marketing and creative platforms. All AI usage in Adobe platforms is based on licensed content, and Adobe has assured users there’s full authenticity of licensing rights back to the data the models are being trained on.

Another stumbling block is heightened consumer fears around data usage and transparency in Australia. According to Deloitte Access Economics’ 2023 report, Generation AI, nine out of 10 Australian employees surveyed identified at least one concern about AI’s use, including fears of leaking personal, confidential or sensitive information (75 per cent) as well as factual errors (73 per cent). Further research cited by Deloitte indicates seven in 10 executives believe using gen AI will create more security risks, as well as potential issues with integrating the technology within existing technology stacks.

FIFA Women’s World Cup Australia New Zealand 2023 COO, Jane Fernandez, said AI wasn’t used in the recent event.

“There’s potentially not enough trust in the technology yet. With a major event like this, you’ve got one shot,” Fernandez said. But there’s no doubt the sports ecosystem is increasing employing AI overseas. Arsenal, for example, selected its team of the century using AI, and Arsenal Women have a partner onboard who is in AI.

“I think FIFA are looking and potentially testing the technology at youth tournaments, which is a good way to do that,” Fernandez said. “For 2026, the FIFA Men’s World Cup is in the US, Canada and Mexico and I know the vision is to use AI there.”

For Adobe APAC digital strategy lead, Sheerien Salindera, the European Union’s GDPR has potentially provided a pathway to quicker AI application in those markets. Not only has GDPR given businesses guardrails and consumers greater confidence in how their data is being used, it’s a good way of feeling like you’re control – something Australian consumers feel they lack.

Fear factor

One dubious honour the ANZ market holds above all others, according to Adobe’s report, is a higher ratio of customers more worried than anywhere else about brands using gen AI and personal data without their consent (63 per cent). That’s the highest number globally.

“In ANZ, 51 per cent of organisations have recently restructured their data governance, versus 39 per cent in Europe. They’ve had GDPR, they haven’t had to,” Salindera said. “I think we’re in a bit of a motion here. It’s good to see corporates restructuring data governance because they know they have to.”

Tribal DDB Group national MD, Davy Rennie, pointed to a number of high-profile cases where data hasn’t been secure driving “healthy scepticism” on the part of consumers and organisations around AI in CX.

“When we’re reviewing our policies of gen AI, it’s in line with existing security policies that do place data security at the heart of the organisation,” he said. “That will never be a bad thing. So if it does take a little longer for us to figure things out, then great. We don’t want to be an early adopter and jump in with two feet in the shallow end, then we’ve got a mess to clean up as we go forward.”

Fernandes noted cultural as well as organisational change is also needed around bringing AI into a business.

“Big governing bodies such as FIFA have been running these tournaments for a long time in a certain way. For them to get onboard is just going to take time – particularly on the policy piece. But there’s the cultural piece as well,” she added.  

AI in CX

Adobe’s new research did, however, illustrate the desire for AI in CX is growing, even if concerns have so far outweighed large-scale application. For example, 43 per cent of ANZ respondents see gen AI improvements as a primary strategic focus, versus 38 per cent globally.

Globally, emerging ways businesses are using or planning to use AI for CX including supporting new customers acquisition (81 per cent), campaign planning (79 per cent), experience creation (75 per cent), audience definition (73 per cent), campaign performance measurement (69 per cent), and experience delivery (66 per cent). A majority of executives (79 per cent) are also currently using or plan to use generative AI for customer support— far more than any other stage of the customer experience journey.

“There is recognition AI can help with both work products, product design and service, but also in marketing and traditional CX functions,” Salindera said. “It’s helping when it comes to the sheer volume of content needed if brands want to deliver personalised experiences to customers across multiple channels.

“AI is primed for customer experience. What the report really detailed when we spoke to executives across industries, whether it was FSI, retail, mining is they recognise the unlock for AI is in customer experience and it’s where you’ll get those early value wins from.”

Quietly confident

Rennie was “cautiously optimistic” about AI’s positive contribution to marketing and CX teams. “What it will do for us as an organisation is free up these creative minds to actually solve problems – real business problems,” he said.

“We know creative is one of the most powerful forces in business. If we gain more time to be creative, not just automating creativity through these tools, we create time for people to be more creative. That goes across traditional art director and copywriter, but also your data scientist, account management team.

“If these teams have more time to creatively solve human problems, then this technology is one of the keys to unlock it. We do hear a lot of people saying they want to use gen AI, it’s in our roadmap. But why? What problem is it going to solve?”

Then there’s the very real need for efficiency and productivity to drive effectiveness. Tribal DDB’s survey of a few years ago found only 11 per cent of content is actually proving effective for brands.

“That means 89 per cent of creative isn’t effective. Yet it’s still out there and we talk about making more and more,” Rennie said.  

Kicking CX goals

FIFA's Fernandez spied a strong use case for AI enhancing ticket purchasing. “If the consumer’s first experience isn’t a good one, they’re not coming back. That was definitely discussed during our tournament when there were some challenges with the ticketing system,” she said. “We can streamline and make things better from an operational perspective.”

Improving accreditation pass allocation given the data required is also low-hanging fruit.

“It sounds dry and boring but it’s so important. Things like this really do enhance the experience for the customer – not just the fan, but the customer being any stakeholder coming to an event,” Fernandez said.

According to Adobe’s research, steps organisations are taking to prepare for gen AI are researching case studies in my industry (33 per cent), hiring new talent (24 per cent), conducting consumer surveys on AI interest (21 per cent), briefing senior leadership on the implications for my organisation (20 per cent) and finding example technology infrastructure to check feasibility (19 per cent).

Humans required

Adobe’s report also focused on how customers perceived AI and where it best served in delivery of digital CX. While 39 per cent of ANZ consumers favour AI-assisted brand interactions and said they’re comfortable with seeing AI pop up in the earlier stages of the customer journey, they’re less comfortable with machines in service, upgrade and support.

For example, 34 per cent are okay with AI taking over the exploration phase of interactions, but only 19 per cent are okay with the machines in charge of renewals or upgrades. By comparison, 48 per cent favour human interaction at this stage of the journey.

Globally, 56 per cent of respondents expect gen AI and other advanced technologies will see digital experiences become more personalised, and 54 per cent believe it’ll make customer support quicker.

Mind the CX gap

Outside of AI, Adobe’s State of Digital CX Report showed 85 per cent of businesses prioritising CX enhancements over other business goals. Mechanisms to achieve this can largely be grouped into the efficiency basket: Integrating CX tech stacks and implementing or acquiring AI capabilities topped the list.

At a top level, Adobe’s research reiterated digital CX leaders as a growth driver, finding businesses prioritising CX to be outperforming others on key business metrics such as new customer acquisition (+23 per cent), customer lead generation (+18 per cent), rate of repeat business (+12 per cent), referral rate (+17 per cent) and profit per customer / account (+9 per cent).

As it has done in previous years, the Adobe research also explored the gap in expectations between how brands see customer experience and where they’re headed, versus consumer expectations around digital experiences.

What was interesting was how immediate the priorities of customers are when it comes to what they’re looking for from brands and how they skew to perceptions of hygiene, value and control. For example, faulty products topped the list of what would stop ANZ consumers from interacting with an organisation (75 per cent), followed by unexpected or non-transparency changes (72 per cent). Difficulty cancelling, pausing or changing a subscription or service came in third (67 per cent), followed by a lack of transparency over data use (64 per cent) and delivery or service delays (63 per cent).  

By comparison, only 40 per cent of brand respondents cited lack of transparency over data usage as something customers would quit a brand for, and only one-third thought unexpected or non-transparent changes were a problem (33 per cent). Instead, brands are still putting too much attention on looking at competitors, Adobe's Salindera said.

For Salindera, the figures all point to service as top of mind for customers and the next frontier of CX for brands.

“Retaining customer loyalty is becoming the battleground. Part of actioning loyalty and bringing that to life is through timely and responsive digital experiences,” she said.

On a positive note, CX has improved over the last three years across ANZ businesses. The Adobe report showed ANZ to be the best region of all those surveyed for seamless usability of brands (57 per cent in ANZ versus 50 per cent globally), consistency of personalisation in-store versus online (52 per cent in ANZ versus 49 per cent globally), and the ability to adjust preferences quickly (55 per cent in ANZ versus 51 per cent globally).

Technology-wise, 83 per cent have invested in a customer data platform or in customer data management and 81 per cent in work or project management.