Twilio has released its sixth annual State of Customer Engagement Report, highlighting the evolution of AI-powered customer experiences across industries. Based on insights from over 7,600 consumers and 600+ business leaders across 18 countries, the report reveals a critical truth: AI is generating measurable ROI—but without trust, context, and relevance, its full value remains untapped.

In today’s financially cautious environment, where brands are under pressure to maximize every customer interaction, companies must align technology, transparency, and empathy to build lasting engagement.

1. AI Delivers Revenue—but Not Consumer Confidence

Adoption Is Strong, Returns Are Promising

• 96% of companies report AI is improving customer-facing functions like marketing, support, and personalization.

• 75% of brands see increased customer spend from personalization powered by AI.

But Customers Remain Skeptical

• Only 45% of consumers feel understood by brands—a slight dip from 46% in 2024.

• 61% of customers don’t believe brands use their data in their best interest.

• 55% are fatigued by the constant messaging around AI.

Takeaway: Revenue growth doesn’t equal relationship growth. The emotional disconnect between brands and consumers could threaten long-term gains.

2. Real-Time Engagement Is the New Differentiator

The Opportunity

• 88% of consumers are more likely to purchase when engagement is real-time and personalized.

• 71% abandon purchases when interactions feel generic or irrelevant.

The Reality

• Only 44% of businesses say they’re delivering real-time personalization today.

Takeaway: Timely, context-aware engagement is essential. Brands must move beyond static personalization and into adaptive, moment-driven customer experiences.

3. Trust Remains Fragile—Yet Fundamental

Consumers Want Transparency

• 90% of consumers trust at least some brands with their data—but only 15% fully trust them.

• 84% desire control over their personalization settings.

• 54% want clarity on when they’re engaging with AI rather than a human.

Perceived Misuse Breeds Caution

• The majority of consumers are wary of how brands use AI, emphasizing the need for ethical, transparent practices.

Takeaway: Without trust, personalization can backfire. Respecting boundaries and offering transparency is no longer optional—it’s strategic.

4. Forward-Thinking Investments Will Define the Leaders

Smart Businesses Are Customizing Experiences

• 96% of brands are moving away from off-the-shelf CX tools to build tailored solutions focused on:

  • Better data collection and usage

  • Automated workflows

  • Transparent personalization

2025 Trends: Richer Channels on the Rise

• 75% of companies plan to adopt RCS (Rich Communication Services) for enhanced customer conversations in 2025.

Takeaway: Customization, AI enablement, and rich communication tools will separate the CX leaders from laggards in the coming years.

Personalized CX Must Evolve From a Feature to a Trust-Based Strategy

Twilio’s 2025 report underscores a critical paradox: AI can deliver short-term returns, but without consumer trust and relevance, its long-term effectiveness is at risk. The brands that will thrive are those that blend technology with transparency, timing, and empathy.

As AI becomes ubiquitous in CX strategy, companies must shift their focus from automation for efficiency to personalization for meaningful connection. Trust, real-time relevance, and customer empowerment will define the next generation of customer engagement.

Final Insight: In an era where loyalty is fleeting and expectations are high, only brands that prioritize both technological sophistication and emotional intelligence will succeed.

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