Customer Engagement Solutions Market Size, Share Global Analysis Report, 2024 – 2032.

Industry Insights

[224+ Pages Report] According to Facts & Factors, the global customer engagement solutions market size was valued at USD 14.23 billion in 2023 and is predicted to surpass USD 44.49 billion by the end of 2032. The customer engagement solutions industry is expected to grow by a CAGR of 13.50% between 2024 and 2032.

Market Overview

Customer engagement solutions are the set of platforms, tools, and strategies that can help businesses improve customer interaction across different channels. These solutions help businesses build strong relationships with customers and gain their trust for the long term. Personalized interactions and better customer service are expected to improve customer satisfaction and retention rates. Also, these solutions help businesses make data-driven decisions as these tools help analyze customer interactions and offer detailed insights into customer behavior.

Key Insights

• As per the analysis shared by our research analyst, the global customer engagement solutions market size is estimated to grow annually at a CAGR of around 13.50% over the forecast period (2024-2032).
• In terms of revenue, the global customer engagement solutions market size was valued at around USD 14.23 billion in 2023 and is projected to reach USD 44.49 billion by 2032.
• Rising interest of people in improving customer experience is driving the growth of the global customer engagement solutions market.
• Based on the end-users, the BFSI segment is growing at a high rate and is projected to dominate the global market.
• Based on enterprise sizes, the large enterprises segment is anticipated to grow with the highest CAGR in the global market.
• Based on the deployment models, the hosted segment is projected to swipe the largest market share.
• Based on components, the solutions segment is expected to dominate the global market.
• Based on region, North America is expected to dominate the global market during the forecast period.

Growth Drivers

• Rising interest of people in improving customer experience is driving the growth of the global market.

Businesses are prioritizing customer experience, which is a major factor driving the growth of the global customer engagement solutions market. Companies are investing heavily in advanced tools and solutions that can help them personalize customer services, improve interaction, and create long-term relationships with customers. Better customer experience, customer loyalty, and improved customer retention rate lead to increased sales revenue for the business. The fast growth of e-commerce and mobile commerce is another major factor positively impacting the growth trajectory of the industry. E-commerce companies are using these solutions to offer tailor-made recommendations to customers.

There is a significant growth in demand for these solutions in BFSI and retail sectors, where customer engagement is the primary goal. The BFSI sector needs a solution to manage consumer queries and streamline interactions across multiple touch points, which further strengthens the demand in the market. For instance, SAP SE came up with a generative AI feature in 2023 in its SAP Customer Experience Portfolio. This feature is likely to help businesses finish complicated tasks in less time and analyze data to offer detailed insights.

Restraints

• High implementation cost is expected to hinder the growth of the global market.

Customer engagement solutions are quite expensive, particularly for organizations with limited budgets. Additionally, integrating these solutions with existing systems is another complex task as it requires additional infrastructure and employee training. Such complexities are expected to hinder the growth of the customer engagement solutions industry during the forecast period.

Opportunities

• Rising adoption of cloud-based solutions is expected to foster growth opportunities in the global market.

Wide-scale adoption of cloud computing is expected to revolutionize the global customer engagement solutions market. Cloud-based solutions are more cost-effective, scalable, and flexible, thereby making them useful for SMEs and large enterprises. Also, the advancements in artificial intelligence and automation technologies are expected to boost the growth of the industry. AI is helping businesses analyze bulk consumer data to identify future trends and predict consumer behavior.

These details help businesses optimize their strategies for improving customer experience and overall revenue. The growing scope of social media platforms is further expected to widen the scope of the industry in the coming years. Customer engagement solutions help businesses manage social media analytics and improve their overall social media strategy. For instance, VSPAGY collaborated with Netcore Cloud in 2024 to help marketers with effective tools and approaches for business to improve their digital marketing techniques.

Challenges

• Inconsistent ROI is a big challenge in the global market.

Businesses struggle to get expected ROI from these solutions which is a big challenge in the customer engagement solutions industry. Additionally, measuring the right ROI from these tools is also a challenging task because of the intangibility of loyalty metrics and satisfaction level of consumers, which sometimes limits businesses from adopting these solutions.

Segmentation Analysis

The global customer engagement solutions market can be segmented into end-users, enterprise sizes, deployment models, components, and regions.

On the basis of end-users, the market can be segmented into travel & hospitality, manufacturing, government, energy & utilities, IT & telecom, healthcare, retail & consumer goods, BFSI, and others. The BFSI segment is anticipated to witness significant developments in the customer engagement solutions industry. The rising emphasis of people on digital banking is the primary reason for the high growth rate of the segment. However, the increasing shift of consumers to digital banking is encouraging organizations to invest in customer engagement platforms to offer personalized experiences across different channels.

There is a growing demand for virtual assistance, AI chatbots, and many others to respond to customer queries and improve customer retention rates. Customer engagement solutions help the BFSI sector to get insights on customer preferences and requirements, which further help them to advise financial products and services tailored to their requirements. Also, these solutions initiate data-driven decision-making, which further helps these organizations address customer issues and reduce the churn rate.

On the basis of enterprise sizes, the market is segmented into large enterprises and SMEs. Large enterprise segment is likely to dominate the global customer engagement solutions market during the forecast period. Large enterprises have a more diverse customer base, thereby leading to increased demand for customer engagement solutions. The growing requirement to handle different customer profiles is also leading these organizations to invest in solutions for customer support, personalization, and customer retention.

Large enterprises have enough funds to invest in comprehensive technologies like customer engagement solutions, which is another major factor in the high growth rate of the segment. Large enterprises deal with intense competition and, therefore, need to work on superior customer experiences to build customer loyalty and brand reputation in the market. These enterprises always prioritize engagement solutions for building long-term relationships and their reputation in the market.

Also, large organizations have complex operational structures like different business units, regional offices, and multiple departments, which further boosts the need for comprehensive customer engagement solutions to offer consistent communication across all platforms.

On the basis of deployment models, the market can be segmented into on-premise and hosted. Hosted is the fastest-growing segment in the customer engagement solutions industry during the forecast period. Hosted customer engagement solutions are much in demand in the market because they offer flexibility and scalability according to the current requirements of the businesses. Scalability helps businesses effectively cater to varying customer engagement requirements, like during high-traffic events.

Moreover, these solutions work on subscription-based models by eliminating the need for any high investment in IT infrastructure or hardware resources. This further makes it a popular choice among end-users. Hosted solutions offer faster deployment times, thereby helping businesses get their work done in a short timeframe with high ROI.

On the basis of components, the market can be segmented into services and solutions. The solution segment accounts for the largest share of the global customer engagement solutions market during the forecast period. There is a growing demand for solutions that can help in initiating customer engagement on channels like mobile apps, websites, social media, and many others, which is a primary reason for the high growth rate of the segment. Solutions offer a unified experience regardless of the platform on which they interact with the brand. This feature is very important for brands to excel in the market.

Additionally, the high adoption rate of AI and automation technologies is further widening the scope of the segment. Customer engagement solutions offer features like virtual assistance, chatbots, and automated workflows, which help organizations deal with customer queries with more personalized communication at a faster speed. AI tools in customer engagement solutions help businesses predict consumer behavior needs and automate repetitive tasks, thereby helping them lower their overall operational cost and boost customer satisfaction.

Report Scope

Regional Analysis

• North America to dominate the global market

North America will likely account for the largest share of the customer engagement solutions industry during the forecast period. The region is leading the market because of the rapid digital transformation. Also, organizations are investing heavily in advanced digital tools to improve their engagement with customers across different channels.

Organizations in the region are adopting advanced technologies like machine learning and artificial intelligence to accelerate their engagement rate and build customer loyalty. Organizations in North America are prioritizing customer experience to gain a competitive edge in the market. They are posing high demand for solutions that can track customer interaction data and respond to customers in real time. Therefore, all these factors are expected to propel the growth of the regional market in the coming years.

Asia Pacific is another major region in the customer engagement solutions industry that is expected to see significant growth in the coming years. The region is home to many leading regional players like Oracle, Salesforce, Adobe, and others who are offering localized solutions to cater to the tailored requirements of businesses in emerging countries like Japan, India, and China.

The fast-moving healthcare sector in Asia Pacific is also a major contributor to the growth of the regional market. The rise of telemedicine and digital health platforms is further fostering wide-scale adoption of customer engagement solutions. The retail sector is also leading the market because there is significant growth in online shopping in APAC.

Therefore, businesses are adopting omnichannel engagement platforms to improve customer experience on social media, mobile apps, and websites. Such a landscape is expected to contribute immensely towards the growth of the regional market. For instance, Alendei Platforms Pvt. Ltd. came up with a multi and omni-channel chatbot product in 2023. It is made to offer enterprise customer communication and engagement.

Competitive Analysis

The key players in the global customer engagement solutions market include:

• Verint Systems Inc.
• SAP SE
• Salesforce.com Inc.
• Pegasystems Inc.
• Oracle Corporation
• OpenText Corporation
• Nuance Communications Inc.
• NICE
• IBM Corporation
• Genesys
• Calabrio Inc.
• Avaya Inc.
• Alvaria Inc.

For instance, Pulsate successfully raised USD 7.7 million in Series A round in 2024. The whole funding was well managed by TruStage Ventures and Curl Collective. The fund will be used to expand digital banking relationships and help expand resources.

The global customer engagement solutions market is segmented as follows:

By End-Users Segment Analysis

• Travel & Hospitality
• Manufacturing
• Government
• Energy & Utilities
• IT & Telecom
• Healthcare
• Retail & Consumer Goods
• BFSI
• Others

By Enterprise Sizes Segment Analysis

• Large Enterprises
• SMEs

By Deployment Models Segment Analysis

• On-Premise
• Hosted

By Components Segment Analysis

• Services
• Solutions

By Regional Segment Analysis

• North America
  • The U.S.
  • Canada
  • Mexico
• Europe
  • France
  • The UK
  • Spain
  • Germany
  • Italy
  • Rest of Europe
• Asia Pacific
  • China
  • Japan
  • India
  • Australia
  • Southeast Asia
  • Rest of Asia Pacific
• The Middle East & Africa
  • Saudi Arabia
  • UAE
  • Egypt
  • Kuwait
  • South Africa
  • Rest of the Middle East & Africa
• Latin America
  • Brazil
  • Argentina
  • Rest of Latin America