Informative Industry Research Report

Generative AI

Joseph Cummings

Eller College of Management, University of Arizona

BCOM 214

29 Oct. 2023
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Table of Contents
Industry Landscape ......................................................................................................................... 2
Relevant Trends .............................................................................................................................. 5
Target Markets ................................................................................................................................ 7
Competitive Landscape ................................................................................................................. 10
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Artificial Intelligence (AI) is fundamentally reshaping the corporate landscape, driving

key trends, and steering target markets with a purposeful focus. In today's dynamic business
climate, AI stands as a strategic imperative, enabling better decision-making, enhanced customer
experiences, and heightened operational efficiency. Beyond the purview of IT giants, AI's
democratizing influence allows businesses of all sizes to tap into its potential, altering the
competitive environment and fostering innovation. As we look ahead, AI emerges as a pivotal
tool for gaining a competitive edge, from automating operations to extracting actionable insights
from vast datasets. It's not just a technological evolution; it's a game-changer that propels
companies toward purposeful growth, foreseeing trends and facilitating sustained success.

Industry Landscape
Chatbot & Virtual Assistance
Businesses can benefit from a range of beneficial products and services provided by
generative AI. One of these is content production, in which artificial intelligence generates
textual content such as product descriptions, articles, and even marketing materials. Businesses
benefit greatly from this, especially when they require large amounts of text. AI can also power
virtual assistants and chatbots, improving the effectiveness of customer service. Without the need
for human agents, these digital assistants may conduct activities, provide instructions to
customers, and respond to inquiries, improving customer service.

Figure 1

American Consumers using Virtual Assistance

As of 2016, this statistic shows how American consumers anticipated using messaging
services or virtual assistants to make purchases or for customer support. At that point, 36% of
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participants said they would be using a chat app like Facebook Messenger to make purchases
within a year.

Predictive Analysis for Sale

In the corporate world, predictive analytics is revolutionizing sales. Making predictions

and assisting with data analysis is another way that generative AI helps organizations. Large data
volumes may be processed and understood by AI, which enables businesses to foresee and make
more informed decisions. It can be used, for instance, to forecast sales patterns, client
preferences, or even the need for equipment maintenance. AI is also capable of producing music,
art, and even code, which can assist with creative and design jobs. This can facilitate the
development of unique goods and creative content for both larger companies and startups.
Despite having a lower share of respondents (30%) than the other divisions on the list, Sales
Analytics (which includes pricing predictions and negotiation) clearly plays a major role in the
other divisions, as shown in Figure 2. For instance, it could be included in Marketing Analytics
and Marketing Optimization, both of which rank highly according to the study.
Figure 2

Expectations on the Impact of Generative Ai uses cases in 2023.

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General Performance

Industry Impact

Generative AI has the potential to create between $2.6 trillion and $4.4 trillion in value
across businesses, based on the 63 application cases that have been examined. Its exact effect
will vary depending on several variables, including the distribution and significance of various
functions and the amount of money generated by an industry. According to these findings in
figure 3, generative AI might improve performance in areas like marketing and customer
interactions, adding an additional $310 billion in value for the retail sector, which includes car
dealerships. In contrast, the majority of high tech's potential value stems from generative AI's
capacity to accelerate and improve software development.
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Figure 3

Generative AI Productivity impact by Business Functions

Relevant Trends
AI adoption and strategy

With over a third of businesses (35%) reporting the usage of AI in their operations, a
four-point increase from 2021, AI adoption continued at a steady rate in 2022. Accessibility,
which made AI easy to apply throughout the company, was a key factor in acceptance, while
businesses are also looking to AI to assist them enhance task automation and cut expenses. The
adoption of AI by larger and smaller organizations diverged considerably as well. Compared to
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only 69% in 2021, larger organizations are now 100% more likely than smaller ones to have
implemented AI within their organization.
Figure 4

AI Adoption Rates Around the World

Impact on GVA growth rates

According to a study by Frontier Economics and Accenture, artificial intelligence (AI)
will significantly affect a nation's Gross Value Added (GVA). It projects the yearly growth rates
of GVA in 2035 for two scenarios: one stable state where artificial intelligence is integrated into
economic processes, and the other baseline state where economic development is projected based
on existing assumptions, see figure 5. The influence varies by nation, from 0.8 percentage points
in Italy or Spain to 2.0 percentage points in Finland or the United States in terms of potential
GDP growth rates.
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Figure 5

Potential annual GVA growth rates in 2035 in %

Target Markets
Demographics

Financial Services

The financial industry may adopt regulatory technology more widely as a result of
developing AI technology. AI is the technology that regulatory technology companies are
considering the most, according to a recent global poll, see figure 6. The use of AI in regulatory
technology has grown dramatically as a result of increased acceptance. These use cases now span
a wide range of industries and include banking, securities, insurance, and other financial
services. These include identity verification, risk management, fraud detection, stress testing,
micro- and macroprudential reporting, anti-money laundering/fighting the funding of terrorism,
and compliance with COVID-19 relief standards.
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Figure 6

Top Five Technologies Employed in Regulatory Technology Offerings

Buying Habits:

Difficulties in hiring AI related roles

Even though AI is greatly assisting many businesses in their manufacturing and

managerial processes, it is still found to have many negative aspects. These disadvantages
include hiring practices and unethical workplace behavior, which make it more difficult for
businesses to maintain control over AI and invest in it.
Figure 7 shows the global challenges of hiring for AI related roles in 2022. Data
engineers had the most increase in hiring challenges when it came to AI-related professions
between 2019 and 2022, with 57 percent of respondents reporting hiring challenges in that role.
Translators came in close second, with 56% reporting that, over the previous three years, it was
much harder or slightly more difficult to hire them for jobs requiring that skill set.
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Figure 7

Global challenges of hiring for AI related roles in 2022

Unethical Behavior at work

A significant portion of employees expressed concern that the introduction of new

technologies would lead to an increase in unethical behavior at work. The workers in Portugal,
Spain, and South Africa were the most worried. In these nations, over 50% of laborers expressed
concern about an increasing behavioral issue brought on by technology. In contrast, workers in
Germany and the Netherlands showed significantly less concern in this area; less than 20% of
them expressed concerns about behavior at work.

Figure 8

Concerns about unethical behavior due to new technologies in selected countries 2021
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Competitive Landscape
Key players in the industry and their marketing strategies

Alibaba

Alibaba's online shopping sites employ advanced algorithms to choose which products to
show visitors when they come and look for products they wish to purchase. It accomplishes this
by creating a unique page view for each visitor with the intention of displaying products they
will find appealing at reasonable costs. Additionally, Alibaba has its own Al-powered chatbot,
Dian Xiaomi, which responds to over 350 million consumer inquiries daily and can comprehend
over 90% of them. These are the resources it needs to handle the massive peaks caused by
special occasions like the "Singles Day" shopping extravaganza, which is organized by Alibaba.
With a score of 82.44 on the 100,000 question test, the deep neural network language processing
technology slightly defeated the human score of 82.3 in 2018.

Facebook

Every time one of us logs into Facebook, we create data on our whereabouts, activities,
and companions. Before social media, we had nowhere to post the 293,000 status updates and
510,000 comments each minute that we today post to Facebook, not to mention the 136,000
photographs we upload every minute.2. Facebook's AI engine, FBLearner Flow, is used to
personalize users' news feeds and homepages by displaying content—including
advertisements—that it thinks people would find interesting or useful. Utilizing machine
learning, it examines and divides the platform's billions of users into groups based on data that
users submit about themselves, including where they live, work, travel to, who they are friends
with, what they search for online, and what signals (likes and shares) suggest about them.
FBLearner Flow is the "backbone" of Facebook's artificial intelligence engine. It is intended to
eliminate the need for computer engineers to be experts in machine learning and enable them to
implement in any department of the business. Currently, more than 25% of Facebook's
engineering teams utilize it, and it's in charge of producing 6 million forecasts for the company
and its clients every second. It is intended to be used to develop algorithms that, once they have
shown to be successful, can be readily utilized across several Facebook initiatives.

In conclusion, the transformative influence of artificial intelligence (AI) is evident in

reshaping organizational operations, fostering productivity, informed decision-making, and
elevated customer service. AI transcends its association with large tech corporations, serving as a
democratizing force that empowers even small enterprises to expand and enhance
competitiveness. As we navigate the evolving business landscape, AI emerges not just as a
technological evolution but as a strategic imperative, a portal to success and fresh concepts.
Looking forward, businesses must embrace AI's potential to stay competitive. Key takeaways
include leveraging AI for purposeful growth, foreseeing trends, and navigating success. For
further inquiries or more information, feel free to reach out to (123) 4567 890 or
abc@arizona.edu
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