As the conundrum continues around the cost-efficiency of artificial intelligence (AI), experts believe AI can reduce operational expenses (OPEX). AI with its automotive powers can automate labour-extensive tasks across industries. For example, generative AI can help in optimising organisations’ buying models to unleash productivity and purpose across their company spending . It is believed that AI can predict market trends, customer preferences, and content popularity, among others. This eventually allows companies to identify target audiences with precision. “AI-powered marketing campaigns can be efficient in reducing costs associated with broad and general marketing efforts. AI is expected to become a key driver of cost reduction in the media and entertainment industry. While challenges remain, the potential benefits are undeniable, making AI a crucial tool for companies looking to streamline operations and improve their bottom line,” Somdutta Singh, serial entrepreneur, founder and CEO, Assiduus Global Inc, LP angel investor and ex-member, Niti Aayog, told FE-transformX, adding that it’s essential to remember that AI’s successful implementation requires careful planning, skilled personnel, and a clear understanding of its limitations.
Cost-cutting statistics
The market for AI is expected to show strong growth in the coming decade. Its value of nearly $100 billion is expected to grow twenty-fold by 2030, up to nearly two trillion US dollars, as per insights from Next Move Strategy Consulting. Service operations and manufacturing benefit the most from the adoption of AI technologies in terms of cost reduction, as per insights from a global AI survey. Around 54% t of respondents mentioned that service operations functions in their organisations witnessed cost decreases. This is expected to contribute to the growing AI market. The lowest cost decrease is expected in strategy and corporate finance, as per insights from Statista, a market research firm. Case in point Netflix uses machine learning (ML) to power its advertising spend, channel mix, and advertising creative, among others, so that it can find new members. Other entertainment channels such as Goliaths, Disney and HBO Max, among others, are also believed to leverage AI for cost reduction.
Walt Disney Company is believed to use AI in character animation, storyboard and forecasting movie box office performance, as per insights from Reuters.. This has eventually helped to reduce the expenditure.. “AI algorithms can analyse user data to provide personalised content recommendations, increasing engagement and reducing churn. This allows media companies to optimise their content delivery and reduce marketing costs,” Agam Chaudhary, founder and CEO, Two99 Org, a marketing solution provider, explained.
The future ahead…
Industry experts believe that AI-powered deep data analysis can provide many advantages compared to conventional methods. AI can uncover concealed patterns and trends within vast datasets, providing businesses with insights into customer behaviour, market preferences, and content consumption patterns, among others. The ability of AI to predict future outcomes, drawing from historical data, enables businesses to forecast market fluctuations, audience preferences, and content performance. Furthermore, this predictive capability facilitates informed decision-making, efficient resource allocation, and targeted content creation.
From what it is understood, AI-driven analysis of operational data allows businesses to identify and address inefficiencies, streamlining workflows, reducing waste, and optimising resource utilisation to achieve cost savings. In the realm of marketing, predictive analysis with AI is expected to create targeted strategies through audience segmentation based on demographics, interests and past behaviour. This ensures that tailored campaigns resonate with specific audience segments, enhancing engagement and return on investment. “AI facilitates personalised marketing by tailoring messages to individual user preferences, improving campaign effectiveness and reducing the cost per acquisition. Real-time dynamic ad optimisation further maximises ROI by analysing campaign performance and adjusting placements, bids, and targeting parameters to reach the right audience with the most relevant message at the optimal time,” Hariom Seth, founder, Tagglabs, an event technology service provider, concluded.
