Concerns about the impact of Artificial Intelligence on existing business models and their implications have begun to arise as we continue to be bombarded with ChatGPT and its derivatives from different categories.
An Artificial Intelligence machine is, in its most simplistic view, a gigantic data processor with extraordinary capabilities to process and organize it, in ways unimaginable until now. Nonetheless, the source of good and bad artificial intelligence remains the same: data on which it has been trained.
Most of our concern is still focused on what kind of tool it is rather than the data that will enable it to be transformed. And every day we continue to see our companies not capturing most of the data they generate and without it compromising their future potential.
The technological investment fund ARK presented a very interesting study in which it estimates that in 2020 the cost of training an Artificial Intelligence machine was almost 5 million dollars. After just two years, the cost was already a small fraction and less than $500,000. The estimate is that this value will be just 30 dollars in 2030…
The consequence of this cost reduction is obvious and direct. The future Artificial Intelligence model will not involve the ChatGPT of that given time, but the integration into our information systems of a proprietary AI model trained with our business, brand, and cultural data. Artificial Intelligence will not be a one-size-fits-all model, as it is today, but rather something tailored to each organization, allowing brands unimaginable capabilities.
Personalization on a scale never seen before
The capability of individually personalizing experiences at a large scale or, in other words, simultaneously giving an unlimited number of people a customized experience is one of the main benefits of artificial intelligence for marketing. Something that was a dream is now very close to starting to happen without disruptions, interruptions, and having to modify the entire value chain of a brand.
Advanced data analysis allows companies to understand customer behavior at an individual level and provide content, offers, and recommendations that are highly relevant to that specific person. This will extend to all brands’ communication interfaces, allowing companies to create more meaningful connections with their customers, potentially increasing loyalty and boosting sales.
Predictive analytics for strategic insights
The business information model is based on what has already happened, being very inspired by the financial world and its reports. But what is happening, given the availability of real-time data capture models, is more important than anything that’s already happened. However, it is the answer to the question “What could happen” that everyone wants answered.
Risk mitigation has always been, and will always be the main focus of Management courses. All the models that are learned serve only this purpose. Business risk is at the top of managers’ concerns and predictive models are their most robust response.
With good data acquisition and advances in predictive analysis based on algorithms created by Artificial Intelligence, companies will soon be able to predict their market trends, the behavior of their customers, and the results of their campaigns with greater accuracy and quality. This information allows companies to more quickly adjust their marketing and communication strategies, maximizing impact and reducing unnecessary risks and costs.
Increased operational efficiency
One of the highest business costs, particularly in industrial companies, is the cost of ownership, whether of stocks or raw materials.
Artificial Intelligence will also impact business models by improving companies’ operational efficiency through the analysis of large sets of data to identify patterns and optimize processes, or reduce costs and production time. Furthermore, the automation of routine tasks will increase productivity and free up our resources for activities with greater added value.
New business models driven by Artificial Intelligence
The application of artificial intelligence will create new innovative business models, as it has with the emergence of the Internet.
Today we can already envision Artificial Intelligence-based products and services, such as virtual assistants, personalized recommendations, and decision support systems. But AI will enable the creation of more efficient business platforms and online marketplaces, connecting customers and suppliers in smarter, more automated ways.
But none of this will be possible without data. The inflection point is not the technology that will be available at a generally low and mass cost. Data that will be required in the future for feeding and training machines are going to make a difference. The companies and organizations that best prepare themselves for this new stage will be those that achieve the best results.
With Artificial Intelligence, the transformation we’re hoping to see in marketing, communication, and business models will take place, but data is going to play a major role in distinguishing us from our competitors. Today, most of our companies do not have a consolidated and robust enough data ecosystem to meet their future needs. If there is something we need to do urgently, it is to ensure that what is ours can be used to our advantage very soon. But we have to act now!
Originally written by João Santos, COO at WYperformance, and published on MaisM.
