Study: 78% of brands in HK rely heavily on third-party data

While businesses in Hong Kong are using artificial intelligence (AI) to power more personalised interactions with their customers, they face challenges around transparency and lack of customer data, a study finds.

Conducted by customer engagement platform Twilio, the report titled “Twilio’s State of Customer Engagement Report” explores how brands are implementing AI to build better relationships with their customers. It is based on a global survey across 18 countries, including Hong Kong, of more than 4,750 business-to-consumer (B2C) executives and 6,300 consumers. 

Considering all markets, 84% of businesses say they provide “good” or “excellent” customer engagement, yet only 54% of consumers agree, according to the study. 

The study also finds 64% of brands in Hong Kong have used AI for personalised content and marketing, slightly lower than the global average of 70%. These brands are realising benefits including higher customer satisfaction scores (45% of companies), better data-driven decision-making (41%) and improved market segmentation and targeting (41%).

Although more businesses are embracing AI, the majority struggle to activate customer data. Only 16% of brands strongly agree that they have the data they need to understand their customers, and just 19% of businesses strongly agree they have a comprehensive profile of their customers, said the study. 

Additionally, 78% of brands in Hong Kong rely most heavily on third-party data in the absence of their own first-party data compared to other regions. This could potentially hamper the brands’ competitiveness in the market as marketers are moving into a cookieless era.

AI-driven personalisation

When companies embrace AI-powered personalisation, global consumers reward them by spending an average of 54% more with them compared to brands that do not. Additionally, global data show that 55% are willing to spend more money for a customised experience, and almost half (49%) of Hong Kong consumers say they’ve made a repeat purchase from a company based on the level of personalisation they received.

Meanwhile, consumers in Hong Kong have the least patience with the highest percentage (85%) would quit a brand if their experiences aren’t personalised, compared to a global average of 64%. In addition, 31% of consumers even say it’s pushed them to purchase from a different brand entirely.

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That is especially true among younger generations that, almost seven in 10 Gen Zs and millennials would stop using a brand that doesn’t deliver personalised experiences on their preferred channels. Additionally, more than one-third of them will abandon a brand that doesn’t engage with them directly in real time.

“Customers today expect personalised experiences and want to understand how businesses use their data to shape those experiences. It’s imperative for brands to be clear about how they use AI, ensuring that they balance how they deploy it with equally robust measures to protect customer privacy. Transparency is not optional — it's a critical component of building and maintaining customer trust and loyalty,” said Kathryn Murphy, SVP product, Twilio.

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