Companies in Mainland China and Hong Kong that are swiftly adopting artificial intelligence (AI) technology stand to see significant revenue boosts, particularly through improved customer experiences. This insight comes from a recent report by Euromonitor International, highlighting the growing influence of AI in everyday consumer interactions and corporate strategies.
The report notes that nearly three-quarters of global consumers now use AI for everyday tasks, including drafting correspondence. This increasing reliance on AI also translates into expectations for businesses, where consumers anticipate companies using similar technologies to enhance their purchasing experiences. In China, a notable 56.2% of consumers reported using voice assistants while shopping this year.
The study further reveals that over the next five years, more than half of the professionals surveyed plan to invest in generative AI, potentially benefiting AI companies like OpenAI, the developer of ChatGPT. Mainland Chinese giants like Alibaba Group Holding and search-engine leader Baidu are already embracing AI, launching offerings based on large language models.
Generative AI is particularly promising for businesses looking to innovate and expedite their go-to-market strategies. It enables rapid content creation and ideation for quicker delivery. Businesses leveraging this technology can analyze user data to guide new product development and integrate customer inputs to tailor marketing campaigns, merchandise, and services at scale.
Euromonitor’s survey suggests that companies expect AI to enhance customer experiences in several ways: by generating more intelligent shopping suggestions (49%), creating targeted marketing campaigns (44%), developing customer-service chatbots (44%), optimizing product imagery and descriptions (43%), and assisting in travel planning and shopping (42%).
One success story in AI application is Trip.com, a China-based travel booking platform. Its AI travel assistant, TripGenie, has significantly improved user engagement and service efficiency, leading to doubled conversion rates and increased user retention.
Looking ahead, the generative AI market is projected to grow exponentially, from US$40 billion in 2022 to an estimated US$1.3 trillion by 2032. After the initial surge in demand following ChatGPT’s launch, companies are expected to see a second wave of revenue growth in 2024 and 2025 as they replicate successful AI applications in their business models.
Beyond generative AI, rising labor costs and the need for automation are driving the development of AI solutions in robotics, advanced data analytics, and lean supply chain management. As such, the AI industry’s outlook remains promising.
In tandem with AI trends, consumer behaviors are also evolving. The report highlights a trend called “value hacking,” where consumers seek premium products at discounted prices or affordable alternatives. Businesses like Yindii in Hong Kong and Thailand, and Mixue Bingcheng in mainland China, are examples of companies catering to this trend by offering quality products at lower prices, challenging competitors like Starbucks and Luckin Coffee.