How are consumers adopting artificial intelligence?

In this blogpost, we explore how AI is rapidly integrating into consumers' daily lives, even if they may not realize it yet.

January 29, 2018
• by
Vivek Sharma

AI (artificial intelligence) usually conjures a smorgasbord of images, metaphors, and predictions. To some people, AI is the general-purpose technology of our era, equivalent to the steam engine and the internal combustion engine 250 years ago; to others, it is the fourth industrial revolution that will affect every industry; to others, such as Google’s Sundar Pichai, AI is more profound than electricity and fire for humanity; finally, to others, AI will be the driver behind an economic boost of US$14 trillion across 16 industries in 12 economies by 2035! What everyone does agree upon is that AI’s impact is huge—and consumers are adopting it right now whether they realize it or not.

Although most people agree on AI’s transformative impact, a lot of mystery still surrounds what AI actually is, its key underlying technologies, and what it can (or cannot) do. AI, broadly defined as “a computing system capable of performing functions that generally require human intelligence,” is generally categorized into three levels of evolution: ANI (artificial narrow intelligence), which is capable of a narrow task such as driving or vision; AGI (artificial general intelligence), which is capable of matching general human intelligence across a wide range of areas like reasoning or perception; and ASI (artificial super intelligence), which is capable of exceeding human intelligence in all aspects—in other words, reaching a point of no return for machine supremacy over humans. For all the hype about “machines taking over” or “humanity at risk,” we are still at the ANI stage with most current AI technologies: computer vision/ image recognition (identify objects and images), machine learning (improve software through data), natural language processing (interacting with humans through spoken language), and robotics. In the rest of this blog, we look at three ways AI is getting out of the lab and rapidly integrating into consumers’ daily lives.

First, the leading consumer tech companies—Google, Apple, Facebook, Amazon, Alibaba—have already integrated AI into their apps, websites, and other digital experiences. That is, the computer, tablet, or smartphone you’re reading this on already uses AI. Digital assistants like Siri, Google Assistant, Alexa, and Cortana use natural language processing (see previous blog, “How do digital voice assistants work?”). Email providers identify spam and sort mail into folders through machine learning (see previous blog, “How do neural networks mimic the human brain?”). Social networks like Facebook use computer vision to identify and tag friends in our posts or even to detect suicidal thoughts and send proactive help. Contact centers use voice recognition to authenticate a caller over the phone and chatbots to automate human-like interaction. eCommerce providers use machine learning to make cross-sell/up-sell recommendations. In fact, Gartner predicts that by 2020, 85% of all customer retail interactions will be done through AI.

Second, non-technology firms are using AI APIs to integrate AI into their products and experiences. Building AI capability requires a large upfront investment, a huge amount of data, and deep technical expertise, which means big tech companies have an advantage. As we discussed in “What is driving the API economy growth?”, technology companies are already offering “AI as a service” to third parties. Wired illustrates how IBM Watson is offered as an API for medical diagnosis: “[IBM] provides access to Watson’s intelligence to subscribing doctors and hospitals and … [could] soon be the world’s best diagnostician… The AI on the horizon looks more like Amazon Web Services—cheap, reliable, industrial-grade digital smartness running behind everything, and almost invisible except when it blinks off. This common utility will serve you as much IQ as you want but no more than you need.”

Third, AI is challenging many industries’ basic beliefs, thus enabling a clean sheet re-imagination of products and services while also changing industry economics and the competitive landscape. Self-driving cars mean that driving does not need drivers. Roboadvisors imply that investment advice does not need investment advisors. Products like Wordsmith imply that business stories can be written without journalists. Retail innovations like Amazon GO imply that shops may not have shopkeepers. Google aptly summarizes the implication: “In an AI-first world we are rethinking all our products…. and moving from a mobile-first world to an AI-first world.”

Despite widespread and very real concerns around data security and privacy, as well as the emerging technology oligopoly, consumer adoption of AI is expected to follow an upward trend—in fact, consumer trust with AI enabled devices is already growing. AI is changing the way we shop, live, work, and move, and the march seems inexorable. When it comes to consumer adoption of AI, Victor Hugo’s words are apt: “There is nothing more powerful than an idea whose time has come.”