By Adrian Brady-Cesana
MARKET SIZE
Based on research conducted by Grand View Research, the global customer experience management market size was valued at USD 10.27 billion in 2022 and is forecasted to grow to 38.98 billion by 2030, at a compound annual growth rate (CAGR) of 18.1%.
The growing importance of understanding customer behavior and their preferences drives various brands and organizations to adopt customer experience strategies, such as regular communication and engagement, longstanding program, and use of automation, to deliver the best service performance to customers in real-time.
MARKET TRENDS
The outbreak of the COVID-19 pandemic has significantly impacted some of the core sectors, such as manufacturing, logistics, and transportation. The adoption of digital technology tools is likely to set the digital transformation and digital optimization of both existing businesses and new businesses. As a result, the market for customer experience management is expected to witness steady growth.
The market will likely witness an increasing share of work delivered through digital engagement models based on collaboration tools and platforms. The rapid proliferation of smart technologies, such as Artificial Intelligence (AI) – a market size valued at USD 93.5 billion 2021 – and advanced machine learning, has reduced the cost of computing and storage power. For instance, automakers use the Internet of Things (IoT) – a market size valued in excess of USD 500 billion in North America in 2022 – , as well as AI and analytics to understand in-vehicle consumer behavior and to provide maintenance services within vehicle sensors that prompt service requests.
Technological advancements will help enterprises design, operate, and improve their end-to-end CEM and drive market growth. AI and its applications are transforming the way that enterprises interact with end-users and enterprises are investing in AI-based customer services to improve efficiency by decreasing complaint resolution and call processing. It allows brands and leaders to offer relevant content, increase sales opportunities, enhance the customer journey, and prioritize the content strategies that can align with the touchpoints with the buyer journey.
Technologies like big data analytics, remove the guesswork and understand customer needs, pain points, goals, and interests, and create total visibility into the buying process. Growing investments in implementing enhanced marketing technologies to assist customers to make cognitive decisions and to develop enhanced customer experience management are also fueling the growth.
The growing trend of investment in customer retention strategies is one of the major factors that drive market growth. Hence, improving customer experience management is critical for ensuring customer retention and satisfaction and subsequently enhancing sales for any business in industries such as banking, manufacturing, retail, and entertainment.
Analytical Tools Insights
The text analytics segment dominated the customer experience management market in 2021 with a revenue share of over 40%. Growing demand for text-based data in comments, feedback, and reviews across numerous digital platforms and offline survey systems across several industries is one of the crucial factors contributing to the growth.
This tool assists companies in extracting valuable insights in an unbiased manner and enhances business decision-making, and also enhances customer experience with secure authentication and self-service channels. Growing demand for easily classifying, understanding, and sorting customer interactions or Voice of the Customer (VoC) across various digital touchpoints has contributed to the growth.
The web analytics and content management segment are expected to witness significant growth over the forecast period from the steady rise in marketing automation and online shopping trends across all the digital channels. The growth in digital content is also likely to drive the growth of the web content management segment.
Touch Point Type Insights
The call centers segment held the largest revenue share of over 32% in 2021. The key segment drivers include the rising adoption of advanced contact center technologies, the emerging role of social media in contact center operations, increasing adoption of virtual and cloud-based contact center solutions, and streamlined customer interactions to achieve high customer satisfaction.
There is elevated pressure on the contact center to provide high-quality services and to meet the constantly evolving consumer needs. To offer improved and notable customer experience management, the companies are increasingly using the capability of contact center analytics. The contact center market was valued at USD 365 billion in 2020 and is expected to grow at a CAGR of 4.2% into 2025. This factor is contributing to the growth of the segment.
The web services segment is anticipated to expand at a significant CAGR over the forecast period. Web Customer Experience Management (CEM) organizations provide responsive and mission-critical customer experiences that support several enterprise information platforms. With CEM, businesses can create a web presence that draws on video, text, images, and documents within the principles to deliver an optimized, social, and non-disruptive experience.
Deployment Insights
The on-premise segment held the largest revenue share of over 61% in 2021. On-premise deployment provides hosting the customer experience management suite or applications on the organization’s server. It is opted by large organizations that prefer their business-critical information to be stored on their servers for enhanced data protection.
Large enterprises have dedicated servers and computing infrastructures that allow them to purchase only a software license or software copy to operate the platform. Moreover, on-premise solutions offer enterprises better management and secure control over their data which is boosting customer satisfaction and brand loyalty.
The cloud segment is expected to witness significant growth over the forecast period. The growth can be accredited to the easy implementation, less cost, easy upgrade, and accessibility. The cloud-based deployment model offers benefits such as faster uptime, fewer disruptions in services, and secure interaction with customers.
Moreover, cloud-based solutions are preferred over traditional systems as they are effective and compatible in addressing the rising level of customer expectations. Cloud technology provides the advantage of low-cost integration of a CEM system within the current business environment.
End-use Insights
IT and telecom held the largest revenue share of over 24% in 2021. Customer churn has been a major issue for telecom operators, as it is one of the significant factors propelling telecom operators to spend more on retaining their most profitable customers. For IT and telecom industries, customer retention is the growth driver. Customer Experience Management (CEM) helps telecom network providers to transform from network/resource-centric businesses to customer-centric businesses.
Other segments of the market include BFSI, retail, manufacturing, government, energy and utilities, construction, real estate and property management, service business, and others.
The healthcare segment is expected to witness significant growth over the forecast period. The health-related organizations, ranging from pharmaceutical companies to health insurers, are not perceived as the most consumer-centric organizations. Increasing adoption of digitalization, technological advancements in cloud and AI solutions, rapid integration of multi channel touchpoints into a single platform, and the increasing need to analyze customer data to draw insights are the primary factors boosting this market.
Regional Insights
North America held the largest revenue share of over 40%in 2021. The rise in adoption of CEM solutions and services by various industries, such as telecom, retail, and banking to foster their customer relationships, and increasing investments in digital channels and marketing by the U.S. and Canadian enterprises are contributing to the growth.
Asia Pacific is anticipated to witness the fastest growth over the forecast period owing to the growing adoption of modern technologies. The continuous rise in the adoption of IoT-based sensors and devices and AI-driven advanced analytics tools to B2C and B2B consumers is one of the significant factors contributing to the growth.
The continuous rise of Small Medium Enterprises in countries like India is placing a strong emphasis on implementing CEM solutions as a part of their efforts to drive their regional and global businesses.
Key Companies & Market Share Insights
A significant number of players hold a major market share. The key players include Adobe; Clarabridge; Freshworks Inc.; Genesys; and International Business Machines Corporation. These players are engaging in new customer experience management services to expand and strengthen their existing touch point type portfolios and acquire new customers. Companies are also engaging in mergers and acquisitions and partnerships to develop technologically advanced touch point types and gain a competitive edge over their competitors.
Segments Covered in the Report
This report forecasts revenue growth at the global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2017 to 2030. For this study, Grand View Research has segmented the global customer experience management market report based on analytical tools, touch point type, deployment, end use, and region.
A full Report, as well as a free Sample of this Research Study can be requested to the Grand View Research company.