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Brands in Malaysia are prioritising customer experiences to drive growth but are challenged by reduced budgets, according to new research from Adobe. To save on costs, organisations in Malaysia are cutting their marketing and customer experience budgets—41% have already done so and another 41% will in the next 12 months.

In response, Malaysian brands are seeking to drive efficiencies by deploying technology solutions that improve workflow efficiency (63%) and implementing generative AI (49%). In comparison, 64% of Southeast Asia (SEA) brands across Malaysia, Singapore, and Thailand, are investing in technologies that improve workflows, and 56% are implementing generative AI. Overall, the research suggests that formal business rollouts of generative AI among Malaysian brands lag well behind consumer demand and employee usage.

Contrasting Levels of Usage Seen

Consumers in Malaysia are excited by how generative AI can improve products and services (47%) and the customer experience (47%). Interestingly, 37% of Malaysian consumers believe leveraging generative AI is necessary for businesses to remain competitive, compared to 35% in SEA.

In the workplace, a large majority (95%) of Malaysian employees said they had already use generative AI in marketing and customer experience campaigns. In contrast, only 38% of Malaysian respondents say the company they work for currently uses generative AI tools. Employees are using text-to-image generators to create promotional brand materials and content (54%), as well as develop concepts and mock-ups for campaigns (47%). Where conversational AI is concerned, 38% of employees use the tool for copy generation and more than half (55%) for research and insights.

Similarly, 95% of employees across SEA are leveraging generative AI tools in marketing campaigns, while only 42% of SEA respondents say their company is currently using generative AI tools.

“A large majority of employees across SEA are incorporating generative AI tools at work, underscoring an urgent need for organisations to get ahead of the curve in AI usage regulations and policies,” said Simon Dale, Vice President & Managing Director, Southeast Asia & Korea, at Adobe. “As generative AI technologies continue to evolve, an absence of a set of strong guardrails and AI ethics principles can pose risks to the organisation and even erode consumer trust.”

Malaysian Brands Fail to Prioritise Factors That Drive Trust and Spending

Adobe’s research found that in a challenging economic environment, brand trust is a key determining factor for consumer spending. Almost half (48%) of consumers in Malaysia said they are more likely to stay loyal to brands they trust, while 34% are more likely to spend more.

In a challenging economy, the number one factor in building consumer trust is keeping data safe and using it respectfully. This is followed by the provision of products and services that benefit people and the planet and are developed ethically at the same time. These factors are also likely to increase the amount a customer spends with a brand.

Conversely, a large majority (86%) of Malaysian consumers say they will decrease spending with brands that do not keep their data safe and respect their privacy, including almost half (43%) that will refuse to spend at all. An inaccessible experience that does not support the needs of people with disabilities will also prompt 85% to spend less, while 88% will cut spending if a brand does not comply with sustainability regulations and requirements.

Despite its impact on consumer spending choices, 45% of Malaysian brands fail to see data safety as important to attracting and retaining customers. For accessible and sustainable products and services, that number rises to 49% and 53%, respectively.

“Consumers are growing mindful of data privacy and how brands are delivering on sustainability and accessibility. To maintain brand trust amidst market shifts and evolving consumer behaviour, brands must demonstrate responsible practices and social accountability. This includes leveraging emerging digital technologies as a business advantage to not only improve engagement, but also keep consumer data safe,” said Dale.

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