Michael Steinrock
A third of Amazons sales come from their recommended “For You” page. Netflix’s “Shows and Movies you may Enjoy” feature has customers continually coming back for more viewing experience. Artificial intelligence and Data Analytics have been around for years, however recently it seems that companies have really been beginning to put a larger emphasis on them. Companies have began to invest billions upon billions in their data analytics and collection practices. This data is essentially priceless. Neil Hoyne says that “ The companies that are going to win are the ones who are using data, not guessing.” The article discusses how companies need to trust Artificial Intelligence to learn. Companies that invest money in AI need to let it do its work finding patterns in customers usage rates as well as purchasing habits.
However, Artificial Intelligence does come with its risks. Jagadeesh describes that “AI can create social, reputational and regulatory risks, even for companies well-versed in technology. Amazon scrapped a recruiting software with a gender bias; Twitter shut down a Microsoft chatbot that “learned” how to post racists tweets; and Facebook was sued by the U.S. Department of Housing and Urban Development.” Artificial intelligence comes with great responsibility and at this moment not nearly as many rules and regulations as many other aspects of the business world. The way these companies use this data, monitoring it every minute of every day is in a sense “good business.” It makes sense to use every ounce of data at your disposal. However the question is do consumers know exactly what and how much data is being taken from them? Jagadeesh argues that the use of Artificial intelligence and data collection needs to be a priority for managers to keep an eye on. He recommends that companies should create interdisciplinary teams to continuously monitor and evaluate data for bias. However even though he warns of being cautions, he recognizes the immense benefits to Artificial Intelligence and Data Analytics in marketing and the business world.
Jagadeesh describes that Data Analytics can really take the “guesswork” out of decision making. These programs and codes can make decisions so much easier for a company to make, since they are always growing and learning and obtaining new information. Take social media ads for example. Do you think that these ads that are popping up on your feed as you are scrolling are just random? Are they “guesses” by the social media company that this is something you may be interested in then? Absolutely not. These data analytic companies and social media sites use every single ounce of data that is at their disposal. Whether it is how long you view a certain post for, to what pictures you like, it is all eventually and meticulously sold right back at you. It will be very interesting in the next five year to see how AI grows, as well as what restriction come along with it. One thing is certain though, it’s not going away.
Source: https://knowledge.wharton.upenn.edu/article/marketing-future-data-analytics-changing/
I enjoyed reading your response to this article because the article gave me a very similar impression. I agree with what Neil Hoyne said about companies who are using data. The "For You" pop ups and pages are intriguing for users. However, these types of features for the users is not possible without the use of data. I have done some prior research on this topic because it is similar to my major and it is unbelievable how much data is being collected. Of course, this brings up the problem of privacy issues. Although, it is tricky because in order to make these types of features for you they need to collect all data. Like you said in your response how they are monitoring what you like and how long you view something. This is incredibly smart by all of the companies using data and this strategy because it has become an easy tactic of marketing. I really liked how the article mentioned the disadvantages of the AI and data analytics. It is important that the article acknowledges that this method is flawed. Some of the AI tools become so advanced with the collected data that it can cause social and regulatory risks, but the real question is do the benefits outweigh the detriments. I would dispute that the benefits outweigh the detriments because it is beneficial to both parties. Collecting the data allows companies to market and advertise their products that are compatible with users. Furthermore, the data that is being collected is based on the users' preferences, therefore it is showing the users thing of their personal interest. I thought this was a very informative and interesting response to the article. My only critique for the article would be to go in more depth about the process of gathering and using the data to the companies advantage.
ReplyDeleteI really enjoyed reading your article and not only did it bring pose some really interesting questions from a business perspective but it also made me think from an ethical perspective as well. Since AI is becoming more and more adaptable for a growing number of uses, it is changing the way we do business entirely. As stated in the article, companies are using AI to track user data to better advertise to users and sell product, but I wonder where this increase in data collection and AI usage will reach a tipping point. As of late, companies have been using AI to make better decisions on things beyond what products to advertise or movies to recommend, rather basic business decisions as a whole. Like Neil Hoyne said, "The companies that are going to win are the ones who are using data, not guessing" - so why wouldn't that apply to decisions like acquisitions, mergers, etc? Analyzing historical data can eliminate the need for guesswork involved in huge business decisions, but why stop there. Should AI be used to make government decisions and vote on bills? Should AI be used in the military to decide if a drone strike is worth it or not? While I'm not suggesting that it should, I feel as though some govt. and company leaders will be asking themselves these questions in the near future, if not already. These decisions obviously hold incredible moral weight as well, where with my last example a computer could be responsible for taking a human's life, and at that point technological singularity (the hypothesis that the invention of artificial superintelligence (ASI) will abruptly trigger runaway technological growth, resulting in unfathomable changes to human civilization) doesn't sound all that unlikely. I think that keeping these moral decisions in mind is obviously more useful in the long term, but it only starts with companies unregulated use of user data for financial profit and business success in tandem with advanced AI. So as long as we are compliant with our personal data being used without discretion by the companies that run our society, I don't think any of the things I mentioned are out of the question in the future.
ReplyDeleteThis topic has become extremely relevant and I have seen that many of the blogs have been about this subject. The use of data and AI has very quickly become essential for businesses who want to maintain a competitive advantage over other companies. AI’s importance is only going to continue to grow especially because technology is being used more by people who are forced to work at home and spend more time on devises, both work-related and non-work related. The precise future of the use of AI and consumer data may not be exactly clear, but the one thing we do know is that competition will drive innovation in the use of data. After the pandemic when more people are allowed to participate in in-person activities, I believe that most people will still use more technology and will spend more time at home than they did before the pandemic. This is because there will be more flexibility by companies who will allow people to work from home. Because of this people will not have a commute and will spend more time watching TV, shopping, or looking for ways to improve their homes. This means that the importance and use of AI and behavioral data will only continue to increase, and companies will continue to gather data about individual consumers. As you mention, this can lead to many problems including lawsuits and privacy violations.
ReplyDeleteNot only can collection of data lead to privacy issues, but it can lead to the misuse of data that can come from inaccurate assumptions. Companies may make assumptions based on where someone lives or someone’s age, but those assumptions are not true at all. The world is becoming more interconnected. Location, age, gender, and many other factors that may indicate habits or preferences are becoming less reliable sources to indicate what someone likes. This can lead to the bias that the article talks about and that bias may be based on information that is not even helping the company make accurate recommendations.
One thing to note is that this collection of data may not always lead to the correct recommendations because they are using bad data. For example, in my family we do not always use the same Netflix or Hulu profile. We are all under the same account, but we each have our own profile. Sometimes my brother will watch shows under my name or my sister will watch shows under my dad’s name. This means that when I go to my profile, they are making recommendations based on shows that I did not want to watch. This shows that companies may be doing everything that they can in order to not guess what people want, but they are using bad data that is useless. Marketing in the future will become very complex and with the use of individuals’ data it will lead to many risks that companies need to pay extra attention to.
I found this article super interesting and one that is very relevant today for many reasons. Artificial intelligence and data analytics are extremely important for big businesses and companies to use, and I agree that they are changing. Data analytics are not only being used a lot not only for marketing purposed by big companies, but also by sports teams and in other different industries. They are changing the way things get done, so I think it's important that we look at how they are changing things and how big businesses are using them. One quote in your blog that stood out to me and that I agree with is when you said, “These data analytic companies and social media sites use every single ounce of data that is at their disposal.” I couldn’t agree more with that statement and think it is very true. One thing I have noticed with social media apps is that whenever I talk about a certain thing, almost instantly will I see an advertisement about that certain thing I was talking about. The other day, I was talking about Spike ball with my friends. A few hours later when I was on Instagram, I saw an advertisement for Spike ball. These companies are listening to us and using artificial intelligence and data analytics to spew out advertisements for us based on what we are talking about and what we are interested in. I think it's crazy that this is the type of world we are living in today. We literally have our phones and these companies listening to us and taking in what we are saying and then based off that give out ads for us to look at. Overall, I think it will be interesting to see how artificial intelligence and data analytics grow as time goes on. It will certainly be interesting to see the next steps these big-time corporations take to grow their data departments and see if they can do more to use them for their marketing strategies to try and grow.
ReplyDeleteHi Michael, I thought your article and your analysis was very interesting. I agree that more companies are starting to rely on artificial intelligence for their business recommendations and decisions, but the article warns companies to continuously tweak and improve their AI capabilities. The COVID pandemic has also pushed for more use of artificial intelligence and data analytics as more people are at home and using technology than we have been before. Although there are major benefits seen from using this new data, we also must be aware of the drawbacks that have the potential to negatively affect businesses.
ReplyDeleteArtificial intelligence is an extremely new technology that does not have the rules and regulations that other older technology has. I agree that it would make sense for companies to monitor users constantly to have the most accurate information, but is that what people really want? I would think that this would not be appealing to most people using social media as they would feel a lack of privacy. It would make it difficult to determine from users how much of their data is being taken and analyzed, a potentially scary thought to have. Furthermore, because this technology is so new there have been some drawbacks. The article mentions various slip-ups that artificial intelligence has done when creating software and assumptions. Artificial intelligence has to be told what to do or not to do and has been seeing a learning curve with its increased use. Without updates or improvements, the data gathered, and results given could lead to major scandals and issues, more so than we have already seen. These issues are not small and must be handled with care and precision.
The companies that are able to implement artificial intelligence correctly will be able to see the biggest gain. But the use of artificial intelligence is new and thus requires a lot of attention to make sure that it is working correctly. The advantages can be really useful for companies making business decisions. Much like you and the author said, it takes the guesswork out of company decision making. Advertisements are much more useful and effective when they can be tailored to you specifically and not general for the entire public. The use of artificial intelligence helps companies gain information about you so that they can show you advertisements that you are more likely to find interesting and useful. In the future, I think we can expect to see much more use of artificial intelligence with the hope that there will be less faults and provide more benefits.