How Artificial Intelligence Could Change The Nature Of Competition In Retail
Big data has given retailers a bank of accessible and scalable memory allowing for unprecedented levels of information and new data streams they would never have imagined. Big data analytics platforms utilize this mountain of data to help retailers find nuggets of actionable intelligence to direct their business decisions.
Big data analytics has another trick up its sleeve, another ability that replaces and improves on human actions in many ways, the ability to learn for itself. ‘Artificial intelligence’ (AI) may conjure up all sorts of science fiction notions, but in reality, forms of AI have been around for some time under names like ‘machine learning’ and ‘deep learning’.
Big Data might get even Bigger
The thing about AI is that the more data it has, the more intelligent it gets – this is true to any level of data and forever. Retailers feeding masses of historical data into a big data analytics platform could immediately have a system that has learnt from all that information. Connecting new and continuous data streams to their platform could provide retailers with a constant flow of better and better predictive intelligence for improved business decisions.
Take Google for example; in recent years the firm has acquired 14 AI and robotics companies. Considering “search” still makes up 80% of Google’s revenues it would be logical to assume that Google is improving its AI portfolio to improve its search capabilities. However when you consider the development of AI you realize that Google is actually using search to make its AI better.
Every search and subsequent click on a given result is training Google AI to know the “right” result for any given query. When you consider the 3.5 billion searches taking place on Google everyday, you begin to get an idea of the potential speed of upcoming AI developments.
In retail the same applies. Every bit of information is fuel for the learning process, as the system becomes more intelligent, predictions become more accurate and increased profits should follow. If more and more retailers chose to adopt such systems, competition becomes a contest between analytical platforms and a data race. Early adopters might gain a real advantage.