Over Half of UK Firms Admit to ‘Data Chaos’ as AI Outpaces Infrastructure

According to new research from AND Digital, 52% of UK businesses admit they’re operating in a state of “data chaos,” with AI adoption outpacing foundational data infrastructure. The rush to implement AI is having a direct business impact—53% of leaders say poor customer experience linked to data issues has cost their companies millions in revenue.

The Know Me or Lose Me report, which surveyed 250 leaders from companies with revenues between £200 million and £2 billion, found that 60% of respondents are prioritising AI investment over fixing core data problems, despite recognising the operational and reputational risks.

67 per cent believe that without significant improvements to customer experience, their organisation will lose millions of customers within the next year, with 64 per cent agreeing the loyalty gap is widening due to AI and data access, calling for the urgent need for CEOs to prioritise customer experience to protect their customer base.

With customer expectations evolving, businesses are increasingly seeing data and technology as the key to enhancing experiences with 71 per cent of respondents agreeing that data is the single biggest factor in delivering good customer experience.

However, the ability to leverage data effectively depends on having the right technical infrastructure as 62 per cent of business leaders say that without the right tech stack, along with financial pressures, their organisation will struggle to retain customers.

57 per cent of respondents agree they are expected to improve customer experience without an increased budget, with a further 69 per cent saying the future of the business landscape will be dominated by organisations with the biggest tech budgets.

Despite economic challenges, businesses are adjusting their financial priorities to focus on customer experience and retention. 71 per cent state that their customer experience budget has increased over the past year, reflecting a growing recognition of the need to invest in long-term customer relationships which is essential for sustainable growth.

Paramjit Uppal, Founder of AND Digital commented: “Its clear that poor customer experience is directly impacting revenue and retention. Business leaders understand that data is the single biggest factor in delivering good customer experience, and most get that without the right tech stack, they will struggle. Its reassuring that despite the financial pressure, leaders are reallocating technology budgets from customer acquisition to retention and loyalty, and many have prioritised and increased their customer experience investments in the past year.”