92% of UK Businesses Will Increase or Maintain Digital Customer Engagement Spend in 2021, Finds Twilio’s State of Customer Engagement Report

One third of UK companies (30%) increased spend on digital transformation by 50-99% in 2020 compared with 2019

UK businesses took longer than other countries to accelerate digital transformation, at an average of 43 days behind France (34), Germany (32), Spain (32), the US (32) and Italy (30)

Twilio (NYSE: TWLO), the leading cloud communications platform, today released its second annual State of Customer Engagement Report, which delves into businesses’ spend and behaviour when it comes to digital communications and customer engagement. This report combines insight from the Twilio platform, which powers over 1 trillion human interactions annually, with results of new global research of 2,500 enterprise decision makers, 300 of which were from the UK. The report reveals that digital communications were critical to business survival in 2020, and the solutions built will shape business success in the post-pandemic economy.

“Digital connection was a defining part of every pandemic experience, and it will be the foundation of the next phase of digital transformation,” said Glenn Weinstein, Chief Customer Officer at Twilio. “From the complex logistics of vaccine distribution, to powering the hybrid workforce, digital engagement is already playing a critical role in the process of recovery and rebuilding the world is tackling now.”

“We’ve seen a huge boost to digital transformation in the past year, and that shows no signs of slowing in 2021. Prior to the pandemic, under half of the UK’s customer engagement was digital, but already that percentage has increased to more than 60%. We have no doubt that this will continue to rise, as businesses strive to address the varying expectations of customers through a mix of digital channels,” said David Parry-Jones, Vice President, EMEA at Twilio.

Key findings from the report include:

• Digital engagement will remain essential to business survival and success. More than eight in ten UK companies (82%) report digital customer engagement will be critically or very important to their success going forward, while 43% suggested that revenue would be lost should their customer engagement not be digitised. Prior to COVID-19, UK respondents said that less than half (48.4%) of their organisation’s customer engagement was digital. Today, that has increased to an average of 61.6%.
• 2020 catapulted us into a hybrid economy, where nearly every in-person interaction will have a digital element. 89% of UK business leaders report that COVID-19 accelerated their move to the cloud. 93% of business leaders plan to increase or maintain their current communications channel offerings after the pandemic, and expect to add an average of 3.5 new channels in the coming year. Over half (53%) of UK businesses surveyed suggested that their digital interactions with customers increased by more than 50% during COVID-19.
• 2020 saw an increase in digital interactions that emulate human conversation. Almost two thirds (65%) suggested that video accelerated more than any other, while 36% used video for the first time. In the next twelve months the top channels that UK businesses are looking to implement are live chat (32%), in-app chat (30%) and video (27%). 60% suggested that video communications have helped build stronger relationships with customers.
• Financial services, retail and technology businesses responded quickest. Almost one in ten financial services companies globally accelerated digital transformation in less than one week, while nearly two fifths (37%) began accelerating within two weeks. On average, retail businesses across the world took 31 days to accelerate digital transformation strategy, closely followed by finance (32), technology (33), manufacturing and automotive (33), healthcare (36), logistics (36) and construction (38). Spend on digital transformation was also up across industries in 2020, with the average increase compared with 2019 at 51.9% in financial services companies, 44.2% in manufacturing and automotive, 43.4% in healthcare, 43.9% in construction, 37.6% in retail and 33.5% in logistics.

Explore the full report here.

Methodology

This report draws insight from Twilio platform data, which reflects digital engagement activity that occurred on Twilio in 2020. Twilio platform data do not represent Twilio’s historical or future financial performance and are presented solely as context for broader market trends. The report also includes original research from a survey of over 2,500 enterprise decision-makers across the United States, the United Kingdom, Germany, Australia, France, Spain, Italy, Japan, and Singapore. The research was fielded by a third party to understand how businesses view the role of digital engagement. Survey respondents are full-time employees of companies with 500 to 25,000+ employees, from the director to executive level.