AI is changing customer expectations. Can businesses keep up?

Customers rarely announce when a brand has lost them. A delayed delivery, an irrelevant offer, or a disconnected service interaction can be enough for them to disengage and move elsewhere quietly.

As AI changes how people discover brands, compare options, and make decisions, expectations for immediate and relevant experiences are rising. Yet many businesses are struggling to keep pace, despite significant investments in customer engagement and personalization technologies.

This gap sits at the center of SAP’s latest UAE Engagement Index. The report finds that 89% of consumers say a brand has recently let them down. While 77% say they love and trust their favorite brands, 57% would switch for a better price, and 52% would leave following a poor experience.

In an episode of Candid Conversations, brought to you by SAP, Fast Company Middle East’s Jennifer George speaks with Charlotte Nichols, RVP Revenue for EMEA at SAP, about why businesses are falling behind customer expectations and what it will take to close what SAP calls the “engagement divide.”

RETHINKING CUSTOMER EXPERIENCE ACROSS THE ENTERPRISE

For Nichols, one of the biggest shifts is how quickly disappointment now turns into disengagement.

“Customers are operating at the speed of AI,” she says. Rather than complaining or formally ending their relationship with a company, customers can simply stop engaging, a behavior SAP describes as “quiet quitting.”

A significant perception gap compounds the problem. Around 74% of brands believe they deliver seamless experiences, yet 66% of consumers say disorganized interactions have put them off. Another 42% say brands do not understand them as individuals.

Businesses often measure performance by department, campaign, or channel. Customers do not. An effective marketing campaign means little if an order arrives late, stock information is incorrect, or a customer is repeatedly passed between service teams.

“An incredible, beautifully created campaign cannot compensate for an order that does not arrive on time, or incorrect stock information, or inconsistent pricing,” Nichols says.

Closing the engagement divide, therefore, requires that customer experience become an enterprise-wide responsibility, connecting marketing with commerce, fulfillment, service, pricing, and other functions.

TURNING THE UAE’S AI AMBITION INTO ACTION

The challenge is particularly relevant in the UAE, where businesses have strong digital foundations and a significant appetite for emerging technologies. Yet 73% of companies remain at a moderate level of engagement maturity, with only 15% considered truly advanced.

The obstacle is not necessarily ambition. Instead, technology, data, and operating models are often not connected end-to-end. The report finds that 56% of businesses say their data is too unstructured to use effectively.

This becomes particularly important as companies accelerate AI investment. Around 76% plan to increase spending on AI-powered engagement in 2026, yet 55% say they cannot use customer data in real time, and 64% have dark data they cannot effectively access.

“AI is not this silver bullet that is going to be able to fix everything magically,” Nichols says.

Without integrated data and governance, AI can only go so far. Effective personalization requires businesses to understand a customer’s current behavior, context, and intent, rather than simply inserting their name into a message or recommending another product based on a previous purchase.

Sometimes personalization may mean changing an offer or suppressing an irrelevant promotion altogether. The goal, Nichols says, is to make the next interaction more useful rather than simply communicating more.

CLOSING THE ENGAGEMENT DIVIDE

Technology, however, is only part of the challenge. Nichols argues that many engagement problems stem from how organizations themselves are structured.

When departments work toward separate objectives and are rewarded through different metrics, customers ultimately experience those internal divisions. Closing the gap requires shared accountability for the customer journey and greater coordination between teams.

Nichols says those conversations are beginning to change. Meetings around customer engagement that once primarily involved marketing teams are increasingly bringing together people from across the organization.

As customers move faster and AI raises expectations further, businesses will need to do more than invest in new technology. The real challenge is connecting data, systems, and teams well enough to act on customers’ needs in real time.

For companies looking to close the engagement divide, a seamless customer experience is no longer simply a marketing ambition. It is becoming a test of how effectively the entire organization operates.