With the advancement of technology, enterprises and business are finding it easy to tap into the right set of consumers. Brands are investing more and more in technologies that are helping them boost their revenue, and AI & ML is one of the most prominent among them. According to Sudheer Narayan, Partner, Bain & Company, enterprises spend anywhere up to 1% of their total revenue on AI & ML currently, and it is set to increase as they see a significant increase in the ROI.
At the 5th edition of ‘The Digital Transformation Summit - A day-long conversation under the themes of AI, Web3 and Metaverse’, organised by The Internet and Mobile Association of India (IAMAI), BestMediaInfo.com caught up with Narayan to explore the future of AI&ML technology and the recently released report by the company – ‘From Buzz to Reality: The Accelerating Pace of AI in India’.
The report was launched by Amitabh Kant, Chief Executive Officer of Niti Ayog alongside Narayan, Sakait Banerjee, Associate Partner, Bain & Company, and Piyush Kumar, VP and Head Data Platform Engineering, MakeMyTrip.
Narayan said that the technology was present for quite a long time but it is maturing now. He said, “AI is predominantly seen in an automation-led cost use case in the consumer and retail sector. Now we are seeing more customer interaction-related use cases now and that is where marketing and advertising use cases play a part. It was already used in media and communication, but now it is also seen in other sectors like BFSI, Health-care, Lifestyle, etc.
“AI technology providers are maturing in the Indian scenario, which is enabling more and more businesses to adopt this technology. The availability of scaled infrastructure help in the business' journey to manage data properly. One of the common things that we are seeing is that where there is software-enabled process automation, AI has a major role to play.”
The report sheds light on the rapidly maturing AI landscape in India. Approximately 80% of enterprises have at least one AI model in production, indicating an extensive penetration of AI/Machine Learning (ML) across enterprises. Within providers too 64% have AI/ML as a core element for many of their products, as against 56% of their global counterparts.
The thrust in AI adoption for enterprises is maximum in sectors such as communication, over-the-top (OTT) and gaming (55%); technology (48%); and financial services (39%). Further, more than 90% of the digital native companies in CPG and retail and financial services have demonstrated AI/ML adoption.
On businesses benefitting by adopting this technology, Narayan said, “The ones who have used the technology in a proper way are seeing 2x to 4x ROI. Right now, enterprises spend 0.4% to 1% of their total revenue on the technology of AI and ML, which will increase subsequently as they see a 4x increase in the return on investment.”
Approximately 150 providers and 340 enterprises were surveyed for the AI Maturity Index in the report, to examine their relative strengths across metrics such as level of adoption, deployment of use cases, data management, technology adoption, and talent. According to International Data Corporation (IDC), India’s AI market was valued at $3 billion in 2020, which is approximately 1% of the global pie. However, the market is expected to grow at the second-fastest rate of 20% among major economies over the next five years, behind only China.
On the developing Metaverse curiosity and the amalgamation of AI & ML with it, Sakait Banerjee, Associate Partner, said, “It will be easier for businesses to serve customers better and understand consumer behaviour better since there will be huge traceability. And with first-party data availability, personalisation will be boosted to a greater extent.”