According to a report released on Tuesday by ServiceNow, a leading digital workflow company, nearly every UAE consumer is likely to abandon a brand after a single negative experience.
This report, part of a global survey that polled 18,000 consumers across 13 countries, including 1,000 from the UAE, highlights that shoppers in the Gulf Cooperation Council states show the least brand loyalty. Notably, 85% of UAE consumers—11 percentage points above the global average—reported being less loyal to brands than they were two years ago.
ServiceNow's research identified cost as the primary factor influencing brand loyalty, with 40% of UAE consumers indicating their tendency to switch brands in search of the lowest prices. Furthermore, 73% of respondents noted they spent more this year compared to the last, with 54% of these individuals citing rising costs as the reason for their increased spending. Given these trends, it's not surprising that when asked about their priorities for brands in the coming year, the most common response (42%) from UAE consumers was for price reductions.
Declining brand loyalty among UAE consumers is also driven by the high value they place on customer service. According to ServiceNow, 91% of UAE consumers are likely to switch brands after a poor customer service experience, and 23% report decreased loyalty to brands compared to two years ago due to unsatisfactory interactions with companies.
Ali Kaddoura, the country manager for the UAE at ServiceNow, emphasized the need for brands to excel in their offerings.
"While cost is crucial, brands must also focus on distinguishing themselves in other areas to stay ahead of competitors, who are just a click or swipe away,"
Kaddoura said.
He highlighted the importance of providing exceptional and streamlined experiences, both human and automated, at every customer touchpoint.
The research further revealed insights regarding the role of AI in customer service. Despite many companies investing in automated solutions like chatbots, a significant 77% of UAE consumers are hesitant to engage with brands that use AI for some services. This reluctance is partly due to a lack of personalization, with 32% of consumers, and distrust in the responses provided, cited by 20% of respondents.
The research also revealed a strong preference for human interactions among UAE consumers, with 58% expressing a desire for brands to provide full 24/7 customer service and 52% advocating for a shift back to human-based customer service over the next year, reducing reliance on automated systems.
This consumer sentiment contrasts sharply with UAE employees' views on AI, as highlighted in a separate ServiceNow study from December. In this study, 74% of UAE employees—26 percentage points above the EMEA average—viewed AI as a significant opportunity for the future workforce, primarily for its potential to enhance productivity.
Ali Kaddoura commented on the findings, stating,
"What we are observing aligns with what proponents of responsible AI have long advocated: AI serves best as a complement to business operations and as an enabler for human employees, not as their replacement."
He emphasized the importance of GenAI in customer service, noting that UAE and global customers might penalize brands for negative experiences. Kaddoura highlighted that AI excels when it empowers employees to foster stronger customer relationships through engaging, human-centered interactions.
"This underscores a very human message, one that is crucial for all of us to embrace,"
he added.
News Source: Khaleej Times
