- Brands will continue to bet on predictive AI to reinforce consumer trust
- Brands will use data more creatively to delight customers and gain their loyalty
- Chatbots will become more sophisticated as brands use conversational AI with an in-depth understanding of customers
- Brands will move beyond SMS OTP for verification and authentication, employing diverse methods with new messaging protocols like RCS
- Brands will focus on collecting only essential, ‘clean’ data while letting temporary or unnecessary data expire
- Technologies like CDP and data warehouses will serve as a cornerstone for collaboration, breaking down silos between customer service, sales, and marketing teams
Manila, December 27, 2024 – Twilio, the customer engagement platform that drives real-time, personalized experiences for today’s leading brands, today shared six trends that will shape brands’ customer experience strategies in the Philippines in 2025:
1. The future of brand relationships will be built on an ‘Ecosystem of Trust’.
Trust has always been the cornerstone of brand loyalty, but in 2025, consumer trust is poised to hit an all-time low. According to Twilio’s 2024 Consumer Preferences Report, 56% of consumers in APAC say they will not purchase from a brand they don’t trust.
With consumers growing increasingly cynical and scrutinizing every interaction, brands must demonstrate greater respect by putting themselves in their customers’ shoes.
It’s time to return to the basics in 2025—keeping promises, following through, and delivering reliable and supportive experiences, during key moments of truth. As the focus shifts towards cultivating an ‘Ecosystem of Trust’, more brands will turn to Chief Trust Officers, to help redefine customer experience, marketing, and technology strategies for building lasting customer relationships.
AI will continue to be a key driver in solidifying this ‘Ecosystem of Trust’. Brands will increasingly bet on predictive AI as they strive to eliminate guesswork, refine recommendations, and improve communications ultimately strengthening brand-customer interactions.
2. Consumers are giving retailers a run for their loyalty. More brands will turn away from traditional “earn-and-burn” models.
Customer loyalty programs driven mainly by discounts and cashbacks are on their way out. Instead, brands will shift towards creating experiences that surprise and delight customers, making them feel valued as their individual preferences and behavior are taken into account. For instance, instead of offering financial incentives, brands might surprise loyal customers with preferential access to new products, or exclusive invites to previews – which cost retailers little, but provide genuine value to loyal customers.
A key priority will be around strengthening ‘phygital’ loyalty programs, combining in-store activations with special offers for loyalty members. Brands will become more intentional about leveraging data to test, iterate, and quickly refine their loyalty strategies – especially as 57% of Filipino consumers say they are likely to spend more on brands that deliver personalized experiences, according to Twilio’s 2024 State of Customer Engagement Report.
With brands in the Philippines already citing ‘streamlined checkout’ as a high priority for improving customer engagement in 2024, they will continue to leverage data not only to create meaningful moments for customers but also to remove friction from the journey—including easing checkout and simplifying rewards redemption.
3. Bots will move away from deflecting, towards genuinely connecting and engaging.
Most chatbots today serve as mere stopgaps, deflecting issues until a human agent steps in to provide real solutions. In addition, chatbots trained on static resources like FAQs or manuals offer generic answers but often miss the opportunity to deliver truly individualized responses tailored to each customer. As they operate based on straightforward rules and predefined content, chatbots struggle to generate responses that truly simulate human engagement.
2025 will mark a turning point in front-line communications as the focus shifts towards eliminating friction in such chatbot engagements. Brands are already adopting conversational AI systems capable of better identifying user intent and generating sentences that mimic the nuances of human conversations. Conversational AI can engage with customers, reference previous interactions, and respond in a way that feels more dynamic and natural.
Beyond conversational AI, brands are also realizing the potential of intelligent AI agents that can offer or upsell products and services, take action on customer issues, make decisions within constraints, and operate across communication channels. These agents—which are not confined to chat windows—have an in-depth understanding of consumer preferences collected over time, past purchases, and previous customer interactions such as login issues or unresolved concerns. They can tailor their communication style to a specific context across channels. AI agents can even be triggered based on an event in the customer journey.
The holy grail is to make these AI agents invisible yet highly effective, creating a customer service experience that feels natural, effortless, and trusted. Contextual data can help turn this into reality, empowering AI agents to better anticipate consumer needs, resolve issues quickly, and eliminate the hassle of requiring customers to repeat themselves.
4. The future of verification and authentication is inclusive.
Historically, SMS OTPs have been the go-to method for two-factor authentication (2FA). Their simplicity and wide adoption have made them a reliable choice, but they come with notable limitations, such as vulnerability to SIM swapping and security concerns around unencrypted messages.
In 2025, we can expect a significant shift in how brands approach user authentication, driven by the emergence of new messaging protocols like RCS, Silent Network Authentication (SNA), and Passkeys. SMS OTPs won’t disappear entirely, but will become a mere thread in organizations’ broader, more flexible authentication strategy.
Rather than relying on a one-size-fits-all solution, brands will tailor verification methods to suit different scenarios and user needs. RCS, for example, enables secure, encrypted, end-to-end messaging that eliminates the need for a code — users can simply click to approve their identity. While passkeys offer a smoother, frictionless experience, they are rapidly being deployed across all apps, and many developers have yet to fully adopt them. In these cases, SMS-based OTPs will remain an important fallback option, especially when users switch devices or face compatibility issues.
SNA is also on the rise as a friction-free authentication mechanism that works by checking if the user’s device is both known and connected to the right network in the right place. Unlike other OTP methods, the end-user doesn’t need to interact with the app to enter digits or press buttons.
In 2025, more brands will adopt a combination of verification methods, considering factors like security requirements, device type, and user location, to create a more adaptive authentication process that balances robust security with a seamless user experience.
5. Data will become the X factor as LLMs level the playing field.
Deploying a bot that can greet users, tell the time, and engage in small talk has become the baseline. What will set brands apart going forward is how they leverage their customer data to deliver truly seamless, superior experiences.
Smarter practices around data collection and management will take center stage in 2025. With more than half of Philippine brands (53%) concerned about compliance and data privacy, one emerging trend is the shift towards data expiration, as brands recognize the risks of holding excess data while customers grow more protective of their information. Moving forward, brands will focus on collecting only essential data—such as email, phone number, and name—while letting temporary or unnecessary data expire.
The importance of having clean and consistent contextual data cannot be overstated as brands increasingly integrate AI agents and conversational AI into the customer journey. More brands will invest in customer data platforms (CDPs) and scalable data validation frameworks to ensure data reliability and trustworthiness at scale.
6. Brands ditch point solutions as they consider the bigger picture. Technology will bring teams closer together.
In many organizations, marketing, sales, and customer service teams often operate in silos – each focused on their data and objectives. This fragmentation complicates attribution and campaign performance reviews due to the lack of a unified view of the customer.
In 2025, more organizations will move away from isolated, point solutions as they realize the value of breaking down silos. They will adopt more holistic, ROI-driven approaches to resolve issues such as redundant customer retargeting, and work towards better reallocating resources toward initiatives that enhance customer satisfaction. By aligning data seamlessly across business units, these brands can enable smarter, more personalized marketing that truly resonates with individual customers.
Emerging technologies like CDPs and data warehouses will continue to gain traction, serving as unifying forces that dissolve the traditional silos that exist within business divisions and teams. These technologies will serve as the cornerstone for collaboration, bringing together diverse teams and business units under a common language – data. Key leaders including the CTO, CMO, CPO, CCO, CDO, and CRO will increasingly contribute to shaping the data strategy and vision of an organization, fostering a comprehensive, unified view of the company and business practices (not just a customer).
About Twilio
Today’s leading companies trust Twilio’s Customer Engagement Platform (CEP) to build direct, personalized relationships with their customers everywhere in the world. Twilio enables companies to use communications and data to add intelligence and security to every step of the customer journey, from sales to marketing to growth, customer service and many more engagement use cases in a flexible, programmatic way. Across 180 countries, millions of developers and hundreds of thousands of businesses use Twilio to create magical experiences for their customers. For more information about Twilio (NYSE: TWLO), visit: www.twilio.com.
