Report finds consumers favour human touch over AI in service

Verizon's Customer Experience Annual Insights report for 2025 has revealed that while companies continue to embrace artificial intelligence to drive efficiency in customer service operations, consumers are reporting significantly less satisfaction with AI-led interactions compared to those handled by human agents.

The report is based on a survey conducted by Longitude, a Financial Times company, and draws on data from 5,000 consumers and 500 senior executives across seven countries, including Australia, the United States, Japan and several European markets. It provides evidence of a persistent disconnect between the internal gains companies see from AI-driven processes and the real-world experiences of customers.

Human preference

The data indicate that 88% of consumers express satisfaction with customer service interactions managed mostly or fully by human agents. By contrast, just 60% feel satisfied when their interactions are primarily handled by AI systems. This substantial gap points to the continued value customers place on human empathy and rapport during service encounters.

The research highlights the specific pain points that consumers encounter during AI-driven service. The primary frustration, cited by 47% of consumers, is the inability to quickly access a live human agent when needed. This sentiment is shared by senior business leaders, with a similar percentage of executives identifying the lack of human availability as the top complaint received about automated service channels.

Personalisation and privacy

Efforts to personalise customer experiences through AI have not yielded the expected benefits from the perspective of consumers. The report notes that more people (30%) feel that personalisation has actually detracted from their customer experience, versus the 26% who believe it has led to improvements.

One contributing factor is concern over data privacy. Among executives, 65% report that privacy regulations restrict their ability to fully leverage AI for personalisation. For consumers, this issue remains significant, with 54% expressing a decline in trust that companies will manage their personal data responsibly.

"The future of CX isn't about AI replacing humans; it's about using AI to make human interactions better," says Daniel Lawson, SVP, Global Solutions at Verizon Business. "Businesses that use AI to pre-empt customer needs, empower their employees, and enhance personalisation while respecting privacy will be the market leaders of tomorrow."

Practical applications

The report identifies successful examples of AI use cases that focus on enabling staff rather than replacing them. During the COVID-19 lockdowns, energy utility company Exelon used predictive analytics to identify middle-income households potentially struggling to pay bills. This enabled Exelon to proactively contact those customers with tailored recommendations for assistance programs, reflecting a blend of technology and human-centric service.

In addition, Exelon is piloting the deployment of generative AI tools to support its customer service agents. This technology assists by providing relevant data and summarising calls, which helps agents manage interactions more effectively and alleviates workload pressures. The report indicates a growing trend towards companies balancing investments in both AI and human resources to improve customer experience.

Methodology and implications

Verizon's CX Annual Insights report, now in its fifth year, surveyed a geographically diverse group of consumers and business leaders to identify emerging attitudes towards automation in customer service. The surveys were conducted over October and November 2024 across the US, Australia, Japan, UK, France, Germany, and the Netherlands.

With AI expected to have a significant economic impact - potentially contributing USD $116 billion to the Australian economy alone - companies are under pressure to integrate these tools thoughtfully. The findings suggest the importance of maintaining a careful balance between AI deployments and the human qualities valued by customers, particularly empathy and trust.