[Foundever] Why 2025 Won’t Be the Year of Hyper-Personalised CX
As generative AI continues to gain momentum, many businesses are eagerly anticipating a future where they can target customers on an individual level with unmatched precision. However, despite the hype and impressive capabilities of AI, it’s crucial to temper expectations when it comes to hyper-personalised customer experiences (CX). Significant challenges and obstacles need to be addressed before hyper-personalisation becomes a reality.
Our 2025 CX trends report explores the growing role of generative AI in shaping the future of customer experience. While the technology has immense potential—particularly for small to medium-sized enterprises looking to compete with larger organisations—the vision of hyper-personalised CX remains elusive in the near future.
For over a decade, the CX industry has been declaring each year as “the year of personalisation”, yet we still haven’t fully realised the vision of personalisation at scale. Although businesses today have more customer data and insights than ever before, and AI is starting to make a significant impact, key challenges persist in preventing hyper-personalisation from becoming widespread.
1. The Data Dilemma: Personalisation vs. Privacy
Effective personalisation hinges on data—lots of it. The more data a company collects, the better it can tailor its services to individual customers. However, rising concerns around data privacy are creating tension. Consumers are becoming increasingly reluctant to share personal information, and governments across the globe are tightening data protection regulations. With laws like GDPR already in place and similar rules emerging internationally, organisations must find a way to balance the need for personalised experiences with customers’ privacy rights. Until this balance is achieved, targeting customers at an individual level will remain a challenge.
2. Silos Stifle Insights
AI’s ability to provide valuable insights is directly tied to the data it can access. However, most organisations still struggle with data silos, incomplete datasets, and issues around data consistency. Hyper-personalisation can only happen when data flows seamlessly across departments and systems, integrating both structured and unstructured data from multiple sources. Until organisations can break down these silos and consolidate their data into cohesive insights, hyper-personalisation will remain out of reach.
3. The Gap Between Vision and Financial Reality
Generative AI is advancing at an extraordinary pace, but often, the speed of technological progress outstrips an organisation’s ability to integrate it effectively. Building a business case, securing funding, and measuring ROI can be difficult—especially in a challenging economic climate. Many businesses are still focused on small-scale pilots rather than large-scale implementations, which further delays the widespread adoption of hyper-personalisation.
4. Moving Customers from Skepticism to Confidence
For any new technology to succeed, it must earn the trust of its users. While AI-powered recommendation engines have become commonplace in e-commerce and entertainment, many consumers remain sceptical about AI-driven personalisation—especially as concerns about bias, inaccuracies, and ethical use of the technology grow. To move toward hyper-personalised CX, brands must first build trust by being transparent about how AI is used, trained, and managed, ensuring its application is ethical, unbiased, and reliable.
5. Customers Change Faster Than Algorithms
While AI is capable of identifying patterns in consumer behaviour, it is not yet able to predict what every individual will want or need at any given moment. Consumer behaviour is continually evolving, and no algorithm is currently capable of keeping pace with these rapid changes. Emotional drivers, demographic shifts, and cultural or geographical differences all play a role in how customers interact with brands. As a result, the quest for hyper-personalisation may always remain just beyond reach.
While generative AI holds tremendous promise for improving customer experience, hyper-personalisation will not be a dominant trend in 2025. However, this does not mean AI won’t have a profound impact on CX in the near future. Find out more HERE
Tags: Foundever
