As we embrace a new year, many marketers and business leaders will be knee-deep into 2024 strategy and implementation. But, this year, there’s a new line on the budget: AI.
Today, we explore whether 2024 will be the year that enterprises invest in AI. We delve into the reasons behind this potential transformation and examine what could be holding businesses back, despite all the buzz surrounding it.
2023: THE YEAR CONVERSATIONAL AI HIT THE MAINSTREAM
To understand the trajectory of AI in the enterprise, we must first acknowledge the astounding developments that have taken place in the past year.
In November 2022, the tech world witnessed the emergence of conversational AI with the launch of ChatGPT. This event carried profound implications: ChatGPT swiftly became one of the fastest-growing consumer technologies, outpacing the growth rates of industry giants like Spotify, Netflix, and even the iPhone. Within just one month, it garnered a staggering 100 million users, a testament to its rapid adoption. Just like in the early days of social media, where personal connections thrived on platforms like Facebook and Twitter, the adoption of AI has initially been driven by consumers.
However, a pivotal moment arrived in March 2023 when GPT-4 was introduced, effectively initiating an enterprise-oriented “hype cycle”.
THE AI HYPE CYCLE: FROM EXCITEMENT TO IMPLEMENTATION
The concept of a “hype cycle” is a familiar one in the tech world, popularised by the research team at Gartner. It typically follows a trajectory of:
- Initial excitement
- A peak of anticipation
- and, then a subsequent dip known as the “trough of disillusionment.”
This was precisely what unfolded with the launch of GPT-4 in March.
GPT-4 brought substantial improvements, particularly in the capability of its API for enterprise applications. Simultaneously, major tech systems such as Slack, Asana, Notion, Salesforce, and Adobe began incorporating AI capabilities into their platforms, enabling the creation of text, images, and even slides. Key players like Google and Microsoft also unveiled their AI tools, further fueling the enterprise adoption of AI.
Fast-forward to September 2023, and the beginning of the 2024 planning cycle, where organisations across industries began contemplating the role of AI in their future strategies. While there was some early investment in AI from enterprises throughout 2023, certain headwinds slowed the translation of AI discussions into concrete projects. This phenomenon is reminiscent of the early days of voice assistants in 2018, which experienced a similar trajectory before reaching their enterprise moment.
However, a significant difference now is that AI is finding its way into budgetary considerations. Before ChatGPT arrived, few businesses allocated resources to AI, particularly in areas like customer service, consumer marketing, search, product development, and user experience. The focus was more on machine learning and algorithmic-driven solutions over large language models (LLMs).
Today, as we enter 2024, for many, AI is firmly integrated into these plans, reflecting its growing importance in shaping the future of enterprises.
AI TAILWINDS DRIVING THE TRANSFORMATION IN 2024
lSeveral factors are propelling this significant shift towards AI adoption in the enterprise. Three key factors stand out:
1. Regulation and Legislation
Across regions like the European Union and the United States, regulations surrounding AI are gradually taking shape. These regulations primarily focus on governing foundation models and AI applications built on top of them. Clarity in regulatory frameworks has bolstered enterprise confidence in entering the AI arena.
2. Emerging use-cases
Defining clear and practical use cases for AI has been a challenge for many businesses. However, in recent times, these use cases have started to crystallise. AI is making its mark in areas such as customer service, reducing contact centre workloads, enhancing consumer experiences through search and generative applications, and streamlining marketing content generation – the news emerging from CES clearly indicates this.
3. Economic value
Consulting firms like McKinsey and Ernst & Young, as well as advertising agencies and platform providers, are increasingly showcasing the economic value of AI implementation. These demonstrated benefits are encouraging businesses to allocate resources to AI-driven projects.
The convergence of these factors is creating favourable tailwinds, driving organisations to earmark budgets for AI initiatives in 2024 and beyond. Whether it’s enhancing consumer-facing applications, streamlining internal operations, or improving customer service, AI will become an integral part of the customer experience in 2024.
CONSUMER ADOPTION: A GAME-CHANGER
The transformation isn’t limited to businesses alone; consumers are also embracing AI at an unprecedented pace. A look at the AI Consumer Index reveals a staggering statistic: 50 per cent of US consumers say they have used a generative AI tool.
This figure isn’t merely speculative; approximately 25 per cent of consumers say they have definitively used AI tools, with another 25 per cent have encountered them in some capacity. Such rapid consumer adoption of generative AI tools within a year is remarkable.
THE AI REVOLUTION CONTINUES TO UNFOLD
As we reflect on 2023 and look into the future, it becomes evident that the past year has been about experimentation and discourse. While discussions have been abundant, implementation has yet to catch up. However, all signs point to 2024 as the year when enterprises will make substantial investments in AI.
The evolution of AI adoption in the enterprise mirrors past technology trends, with consumer adoption preceding enterprise involvement. AI is now firmly embedded in budget considerations, and the convergence of regulation, emerging use cases, and demonstrated economic value is accelerating its integration into business strategies.
In the ever-changing landscape of technology, one thing is certain: the AI revolution is well underway, and it’s set to reshape the way we do business in the years to come.
So, will your organisation be among those investing in the enterprise AI revolution in 2024?
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