The concept of artificial intelligence (AI) has existed for decades, but only in recent years has the potential scale and significance of its impact come to the fore. Now, it holds the power to influence and shape future success.
But what really is AI? What are the benefits and risks of adoption? We’ve all read the headlines of mass job losses, privacy concerns, the mishandling of consumer data and potential biases that may arise from artificially intelligent systems.
And we absolutely need to ensure systems and processes protect sensitive information and jobs. But we also need to find the right skills and understand what consumers really want to see from the technology; research frequently reminds us that AI will lead to the creation of entirely new roles.
Finding the opportunity
Despite major technological advancements in recent years, organisations are only now scratching the surface of understanding AI technologies and their potential application. The truth is that some people already rely on AI daily – by asking Alexa to add items to our Amazon shopping list or asking Siri for opening hours at the local convenience store.
Wunderman Thompson’s latest research, “Adopt or Fail: Why Business Needs AI” found that 83% of business leaders claim to have a strong understanding of AI, and 77% of businesses have already adopted AI solutions. But with this confidence comes uncertainty. The vast majority (90%) of leaders who are using AI think that their current implementation could be more effective.
It’s clear there is an opportunity to grow the understanding and implementation of AI in business to unlock greater business potential, but margins are tighter than they were pre-Covid-19; the current retail environment has had to weather chip shortages, supply chain disruptions caused by geopolitical events and increasing consumer demands. And the gap between failure and success is becoming smaller, both financially and reputationally.
What’s holding businesses back?
As businesses are already feeling the post-pandemic pinch and consumer demands are ever-evolving, savvy technological investments will be the difference between thriving and surviving. This is where AI-based system concerns and barriers to implementation overshadow such potential.
First, leaders must come to terms with what’s holding their business back from using AI more if they are to unlock success. Over half of business leaders say they are concerned about the impact AI might have on their employees, and 50% worry about a lack of control over the AI technology.
Access to technology could largely become commoditised in the future, so the ability to attract, retain and empower talent will be the key to success. Here, employees with technical skills that can work across the business will be vital.
AI has the power to support and optimise employees’ time as well, so long as it’s given the appropriate credit; AI can augment the workplace, not replace it. Just like any other tool that has come before, the trick is how and where you apply AI in your organisation to leverage the full capabilities of the workforce and the technology.
Overcoming the barriers
It’s clear that retailers are up against more than one obstacle when it comes to operations. And AI can help bridge the gap by enabling better decision-making, faster data processing and improved retail experiences – online and in-store.
When 45% of consumers admit to getting angry about low stock levels, or 63% have been frustrated that their products did not arrive in the time quoted, responding to consumer demands for convenience and speed is essential for business survival.
Consumers have become quick to call out slow, and unreliable supply chains and retailers must now address these areas to alleviate pressure. Not only is this something that AI can support, but over half of shoppers (59%) actually crave personalised deals and discounts.
It’s no longer a business advantage to implement AI, it’s mission-critical. And overcoming barriers sooner rather than later will only support businesses to improve customer satisfaction and retention.
Start now – before it’s too late
So, where should businesses start? This depends on where they are in their AI journey. But a key place for any business is to assess the biggest areas or sources of friction. Questions such as: do we have access to data? How are we measuring success? How quickly can we prove value? These will allow businesses to narrow down and focus on specific areas that AI can then support.
And for customers, while the value of AI is clear to see – over half (51%) of consumers believe it has the potential to improve the quality of life – exactly half are concerned about their data safety. It’s a dynamic that retailers and businesses alike will have to successful balance.
Then, attention must be turned to the team. Employee capabilities, third-party partners and the development process will be key to successful implementation. It’s not about tackling all business issues at once but starting with the greatest problem areas and implementing solutions to support them.
A failure to adopt AI will fundamentally leave retailers behind. AI as a business tool is no longer a niche concept for the early adopters, it’s something every organisation wants – and needs – to implement to thrive.