An overwhelming majority of businesses (85%) plan to use AI to adapt their marketing strategies to meet the demands of Gen Z consumers, according to new research.

Twilio’s annual State of Personalisation Report, released on Tuesday (18 June), found that 59% of businesses anticipate a daily reliance on AI by 2025.

The report found that Gen Z consumers expect greater personalisation in their engagement with businesses. To meet this Gen Z consumer demand, 86 percent of business leaders expect a significant shift from reactive to predictive personalisation across the industry.

“Brands to anticipate their needs and AI is making that a reality,” Robin Grochol, VP Product Management at Twilio said.

AI can provide business with real-time insights and information to engage with customers. This will result in personalised marketing strategies that effectively meet consumer expectations. Some 82% of business leaders agree that it is advantageous to use integrate emotional intelligence into its business model.

According to GlobalData’s Thematic Intelligence report on Gen Z, Gen Z is also concerned with the ESG performance of businesses. The International Institute for Sustainable Development forecasts that the market for ESG-mandated investments will reach $160trn by 2036, up from $30trn, in 2018.

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The combination of Gen Z’s concerns around ESG and the rapidly growing market of ESG-mandated investments has given Gen Z significant financial power and influence in the consumer market.

Businesses recognise the need to respond to Gen Z demands for greater ethical standards and personalised consumer engagement.