**Artificial Intelligence’s Impact on Businesses: Insights from Industry Executives**
No one understands the disruptive power of artificial intelligence (AI) better than Chegg CEO Dan Rosensweig. Earlier this year, when the online tutoring company attributed a weaker revenue forecast to ChatGPT, its share price plummeted by 48% overnight.
AI’s Potential to Transform Customer Relationships
At the Fortune Brainstorm Tech conference, Rosensweig candidly discussed the negative impact AI can have on businesses. He revealed that the launch of the free service ChatGPT 4 resulted in the loss of 100,000 paying Chegg subscribers. Rosensweig’s experience has led him to question whether anyone is truly “AI ready” and whether the meaning of being “AI ready” is understood by anyone in the industry.
While Rosensweig highlighted the downside risks of AI, other executives on the panel expressed cautious optimism about the technology and its potential to strengthen customer relationships.
A.I. in Checkout: A Promising Application
Amit Patel, CEO and president of the $8.5 billion discount shopping platform Rakuten, sees tremendous potential in using AI to enhance the checkout process. Patel noted that the data indicates that the checkout remains a significant friction point for consumers. He revealed that approximately $20 billion worth of merchandise is abandoned in Rakuten shopping carts per year. However, he strongly believes that AI can convert a substantial portion of this abandoned merchandise, estimating that up to 10% of it can be converted into sales by leveraging AI. Patel emphasized the need to streamline the checkout experience across various payment platforms like Apple Pay and Google Pay to make it fast, easy, and enjoyable for customers.
The Challenges of Implementing AI
Companies both large and small are grappling with the question of how best to leverage AI in customer-oriented aspects of their businesses. Brad Hiranaga, the chief brand officer at Cotopaxi, an outdoor apparel brand with 311 employees, expressed reservations about fully understanding the impact of AI on their business.
Jim Steele, the president of global strategic customers and partners at Salesforce, echoed the sentiment, outlining the challenges faced by his team in understanding and implementing AI. He emphasized the importance of establishing a comprehensive AI rollout plan, which includes separating sensitive data from data used in large language models, setting clear governance guidelines, and ensuring that employees are prepared for the AI transformation. Steele acknowledged that managing vast amounts of customer data presents unique challenges for his company.
While the Chegg CEO’s experience with ChatGPT highlights the potential risks associated with AI, industry executives like Patel, Hiranga, and Steele remain hopeful about the technology. They recognize that AI has the potential to revolutionize the way businesses interact with customers and streamline processes. However, they also acknowledge the need for careful planning, clear governance, and employee readiness to navigate the challenges posed by AI implementation.
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