Customer Experience AI: Will Perception Drive or Deter Adoption?

The beginning of the year ushers in Frost & Sullivan’s annual customer survey research, which will be completed sometime after this writing. But if 2025 is anything like 2024, when businesses and providers were giddy about artificial intelligence developments, AI adoption will surge. In 2024, the adoption plans of contact center stakeholders were heavily contingent upon balancing the scales of the customer experience (CX) and employee experience (EX) because of the interdependencies of the two. Simply put, make EX more satisfying and proficient and that spills onto the customer. For instance, in Frost & Sullivan’s 2024 IT Decision Maker Survey, 61 percent of respondents planned to employ AI to improve CX and EX in the next two years.

But in 2024, the highest investment priorities were slightly skewed more towards employee engagement, and less so in customer-facing applications, such as employee training and development (83 percent), AI-powered self-scheduling (81 percent), advanced workforce management (77 percent), and collaboration tools (74 percent). Whereas 76 percent said they had plans to upgrade or replace interactive voice response (IVR) units, adding an intelligent virtual assistant (IVA) to front-end their contact centers, this is typically low-hanging fruit that gets rid of legacy systems and addresses both CX and EX by offloading agents. Speaking with customers and solution providers elicited similar sentiment with AI investments in IVA adoption, but also more focus on enhanced workforce engagement management (WEM) suites, as well as on point solutions such as agent or supervisor assist, transcription, and process automation.

What About the Customer/Consumer?

This raises the question of whether adoption is consumer led or not. Twenty years ago, consumer awareness of AI, let alone acceptance, was nascent and increased exponentially with speech-driven games and toys and personal assistants such as Siri. Now AI is everywhere. Just look at products showcased at the 2025 Consumer Electronics Show, which had 4,000 vendors and 150,000 attendees; as the show demonstrated, AI is proliferating in all areas of the consumer experience, from innovation in home security and energy management to smart TVs and appliances and personal electronics such as smart watches and wearables, just to name a few.

When it comes to customer service, however, we haven’t seen the tipping point where consumers have fully embraced AI in a customer service setting. Consumer pushback has come in part from the fear factor around AI, which has been a recurrent theme in the press for good reasons. With the introduction of ChatGPT and generative AI, consumers and businesses alike have struggled with issues such as security, accuracy, cost, privacy, and the ethical use of AI. GenAI-fueled use cases have also been slow to emerge.

What is missing from the CX AI equation is the tie-in between AI-bolstered solutions consumers are more or less aware of—such as the shopping personalization that happens when you’re filling your Amazon shopping cart, using a fitness wearable, or interacting at home with Alexa—and the ones they engage with on any CX channel to get service and technical support.

From Fear Factor to Promotion

While the industry has been addressing the challenges of AI implementation, it needs to heavily invest in both quelling the fears of consumers and promoting use cases in a way that echoes the introduction of Siri by Apple. Part of this is the need for cross-industry public relations, but a bigger part is in implementing, then promoting applications that showcase a streamlined, personalized CX.

For example, with hyper-personalization, businesses can create and deliver tailored content and experiences to individual users based on their preferences, past interactions, and unique needs. And it also can supercharge outbound customer engagement, providing targeted, just-in-time offers, information, notifications, and enticements for additional engagement. Awareness can also be driven by expanding the use cases, such as building capabilities that bridge the physical and digital in a customer journey. A good example is in a healthcare setting, where an IVA can handle appointment booking and reminders and offer GPS help for getting to an appointment, and then do check-in and other components.

There is plenty of fuel for changing the narrative around AI and genAI from an emerging technology to one that is capable of practical use cases. And that will help change the sentiment toward AI as something that is unknown and a little scary to something that is useful and perhaps indispensable. 

Nancy Jamison is a senior industry director of information and communications technologies at Frost & Sullivan. She can be reached at Nancy.Jamison@frost.com.