Artificial Intelligence impacts brands across categories
Vital tool helps personalize products, services, communications
Brands across the categories analyzed in the BrandZ™ China Top 100 report increasingly rely on artificial intelligence to help understand and fulfill rising consumer expectations for more personalized products, services, and communications.
By converting data into insights, and progressively refining those insights based on experience, AI enables brands to create ever-more detailed portraits of individual customers and groups of customers. Rather than defining a customer segment as all people 19-to-35 years old, for example, a segment might include only the people in that age group who commute on a rental bike and order in food a few nights per week.
Brands also use AI to create more relevant new products and services, optimize supply chains, and reduce costs. And because the accuracy of AI learning is generally a function of the amount of available data, China enjoys an enormous advantage with its population of over 1.3 billion people and relatively less restrictive attitudes about privacy.
However, China’s population is not monolithic in its needs and wants, which means that data from one region do not necessarily yield the correct insights for another region. This distinction is important as brands seek opportunities in rapidly-growing lower tier markets or overseas, where most Chinese brands lack significant experience.
Deeper understanding requires collecting and analyzing more data—the text, sounds, and images that can yield new insights. And, as in any market, it is also important to leave room for less predictable behavior because serendipity can make the brand experience more engaging. How Chinese brands implement AI varies by category.
In the technology category, the search engine Baidu expanded its commitment to AI, including a partnership with Xiaomi, the smartphone maker. Xiaomi’s strategic focus on AI and the Internet of Things, also includes partnerships with Ikea, the furniture brand, and Ji Hotels.
AI is central to the strategies of home appliance brands, such as Haier and Midea, that are developing smart appliances to meet the needs of more affluent and sophisticated Chinese consumers who increasingly look not simply for individual appliances or devices, but for products with the smart home connectivity.
At the 2019 Consumer Electronics Show in Las Vegas, ECOVACS introduced its first robotic vacuum cleaner with a camera to view and understand its environment in a manner similar to an autonomous car. Rather than halting when it encounters a stray sock, for example, AI enables the vacuum to recognize the object and drive around it.
In entertainment, iQiyi, a streaming site similar to Netflix, uses AI to understand the preferences of its audience and produce relevant content. The online travel brand Ctrip uses AI to understand customer travel habits and market relevant hotel and restaurant offers.
Lifestyle platforms, such as Meituan, Ele.me, and Dianping, depend on AI to rapidly interpret and respond to customer needs. Using AI software, for example, Meituan refines its food delivery service by identifying and categorizing images that consumers upload to Meituan’s app every day.
Analysis of these data, such as photos of menu items and restaurant facades, help make customer searches more effective. AI can also help increase the accuracy of estimated delivery time, potentially improving customer satisfaction.