Customer Experience Management Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Customer Experience Management Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The customer experience management market was valued at USD 10.23 billion in 2020 and is expected to reach USD 27.13 billion by 2026 and grow at a CAGR of 17.9% over the forecast period (2021-2026). Increasing adoption of digitalization, technological advancements in cloud and artificial intelligence solutions, rapid integration of multichannel touchpoints into a single platform, and the increasing need to analyze customer data to draw business insights to increase revenue are some of the primary factors boosting the customer experience management market.

Key Highlights

• Brands are increasingly dependent on customer experience management tools to determine customers' requirements and to verify that the customer needs and the company's offerings are on the same level to be one step ahead of competitors. Companies also utilize cloud-based technology, advanced analytics, and automation to provide highly personalized customer experience and build brand loyalty to reduce churn rate. According to a study, brand loyalty aids companies to achieve revenue gains of 5% to 10% and reduce costs by 15% to 25% within two or three years as new customer acquisition costs five times as to retain a current customer.
• The advent of technology has led to the digitalization of every sector and has tremendously increased the digital customer interaction. Technology evolution at a rapid pace has led to the creation of more intuitive and user-friendly interactions. But as customers are now accustomed to user-friendly and personalized digital natives, such as Google and Amazon, they expect the same kind of service from established players. According to research, 25% of customers will defect after just one bad experience, and thus, companies are demanding multi-purpose, user-friendly, accurate, and fast solutions from the key vendors.
• For instance, in 2019, Oracle has launched a series of new data-first updates across Oracle Customer Experience (CX) Cloud. The latest updates include new digital assistants for sales, customer service and marketing professionals, new data enriched B2B sales capabilities, and latest industry solutions for telecom and media, financial services, and the public sector. These updates were built on data and machine learning solutions to help brands take advantage of powerful data insights to get ahead of customer needs and ensure smooth, positive, unforgettable customer experience.

Key Market TrendsTravel and Transportation are Expected to Witness Moderate Growth

• According to the WTTC 2019 report, the travel and tourism sector experienced 3.5% growth and outpaced the global economy (2.5%) for the ninth consecutive year. Over the past five years, one in four new jobs were created by the sector and has generated 10.3% of global GDP. This data reflects the sector's significant growth in the coming years.
• The travel and transportation sector has experienced a digital transformation over the past few years due to the overwhelming shift of customers from traditional paper to digital solutions. The rapid adoption of mobile and access to internet services across the world has forced all the travel companies to switch to mobile supporting applications to enhance the customer experience.
• Modern travelers use technology at every single point, from reaching to the airport, checking in, accessing in-flight entertainment, managing itineraries, unlocking hotel rooms, handling customer service problems, or looking for food to eat. This trend has led to the development of mobile integration solutions that provide personalized data and have ultimately improved customer experience. For instance, Wyndham Hotel Group uses Adobe Analytics to gather data, time-based metrics, geolocation, and personalization data for better application experience to loyalty members.
• Emerging technologies like the release of 5G, advancements in Artificial Intelligence, and improved voice search are some of the technological disruptions that will create new ways for travel companies to engage customers and make travel easier, richer, and more convenient. For instance, travel companies use messaging apps and chatbots to integrate the growing power of artificial intelligence into the mobile travel experience.
• The outbreak of COVID-19 has completely disrupted the tourism sector, and so has weakened the customer experience management market in particularly this sector. According to the research conducted by the World Tourism Organization (UNWTO) on April 6, 2020, 96% of all worldwide destinations introduced travel restrictions in response to the pandemic. Around 90 destinations have entirely or partially closed their borders to tourists, while a further 44 are closed to certain tourists depending on the country of origin. Moreover, International tourist arrivals could decline by 20% to 30% in 2020. This can lead to the loss of millions of jobs in the global tourism industry for at least the next three months.

Asia-Pacific is Expected to Witness Significant Growth

• Digital transformation has opened up a plethora of opportunities in the way contact centers have been functioning, and the Asia-Pacific region is experiencing high adoption of a customer experiencing platforms in various industries. For instance, in 2019, Singapore Airlines, one of the world’s best airlines, has partnered with Insider to drive its customer satisfaction initiatives. Insider’s growth management platform based on the latest artificial intelligence technologies will enable Singapore Airlines to deliver highly personalized, meaningful experiences to each individual based on historical, real-time, and predictive data.
• Asia accounts for the maximum number of small and medium-sized enterprises (SMEs) who require technologies to serve the customer in better and smart ways. About 80% of SAP’s customers are SMEs who can benefit, backed by learnings and data to become a larger enterprise in the future. Scott Russell, the president for the SAP Asia Pacific Japan (APJ), revealed that Asia-Pacific and Japan would continue to be one of the primary investment markets as the market is not saturated, businesses require technology to enhance customer experience and to gain competitive advantage.
• Increasing investment by vendors in the Asian market is also boosting the customer experience management platform. For instance, RateIt, Singapore headquartered, raised USD 5 million in its series A funding round in 2019. It is a startup that provides real-time customer experience management platforms to global brands. More than half of its revenue is generated from Southeast Asia with clients including Metro, Maybank, Lego, and several small and micro-enterprise firms.
• Asia-Pacific will experience high growth due to the rapid urbanization and digitalization of the developing countries and increased usage of digital transactions in developing countries, such as India, China, and Singapore.

Competitive Landscape

The customer experience management market is highly competitive and moderately fragmented. A few major players like Adobe, Oracle, SAP, IBM, Avaya Inc., and Verint Systems Inc. are focusing on expanding their customer base across foreign countries. These companies are leveraging strategic collaborative initiatives to increase their market share and increase their profitability. However, with technological advancements and product innovations, mid-size to smaller companies are growing their market presence by securing new contracts and by tapping new markets.

• March 2020 - Adobe launched the Digital Economy Index, the first real-time barometer of the digital economy, to analyze trillions of online transactions across 100 million products in 18 categories. It reflects consumers' desire to purchase products in the future. It is powered by Adobe Analytics and based on a new digital consumer shopping basket measuring scale of online goods and services. It has also protected many businesses during the pandemic outbreak COVID-19, as it helped many companies become digital.
• February 2020 - Verint System Inc. partnered with Adobe to support more personalized customer journeys by combining experience data from the Verint Experience Cloud along with data from the Adobe Experience Platform. Organizations can leverage customer experience data seamlessly to automate the process of predicting and acting on experienced drivers, the key to anticipating, and meeting customer needs. Companies can now automate and take action on real-time insights across every level of the organization to drive meaningful outcomes, prioritizing improvements based on desired impacts.

Additional Benefits:

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support

Companies Mentioned
 
MaritzCX Research LLC
Medallia Inc.
Clarabridge
Sitecore
Zendesk
Open Text Corporation
IBM Corporation
Tech Mahindra
Verint Systems Inc.
Avaya Inc
Oracle Corporation
SAP SE
Adobe Inc.

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