Lec 06- Customer value and Role of AI in Value Delivery Process
Summary
TLDRThis AI in marketing certification course module explores the role of AI in enhancing customer value and its integration into the value delivery process. It discusses the strategic and tactical aspects of marketing, emphasizing the importance of AI in optimizing operations and creating personalized customer experiences. The module also covers AI's impact on efficiency, process enhancement, and innovation across various industries, highlighting the potential for AI to drive value creation and transform business models.
Takeaways
- 📚 The course focuses on Module 6, which discusses the development of marketing strategies and plans using AI, emphasizing the role of AI in the value delivery process.
- 🤖 AI is increasingly important in marketing due to its ability to understand, attract, and retain customers by offering personalized experiences and real-time feedback.
- 🛍️ The value delivery process in businesses includes three phases: choosing value, providing value, and communicating value, which are crucial for sustained success.
- 🔑 Strategic marketing involves segmentation, targeting, and positioning to choose value, while tactical marketing uses the marketing mix (product, price, place, and promotion) to provide and communicate value.
- 📈 AI applications like computer vision, deep learning, and robotics process automation can optimize operations and reduce costs, leading to increased efficiency in the value chain.
- 🚀 Companies like JD.com have leveraged AI to improve operational efficiency, achieving a high percentage of same-day or next-day order delivery.
- 👟 Nike uses augmented intelligence to design customized shoes, demonstrating how AI can streamline the value chain from design to customer delivery within a short timeframe.
- 💼 AR Financial Services Group exemplifies the power of AI in the financial industry, serving a vast customer base with a fraction of the employees compared to traditional banks.
- 🔄 The value chain is a complex system of interconnected business activities that AI can help automate and manage more efficiently, reducing costs and improving decision-making.
- 🛠️ AI technologies are being adopted across various industries, with high-tech and telecom sectors leading the way, while traditional industries like construction are catching up.
- 🌐 Salesforce Einstein's use of AI to enhance sales processes and Stitch Fix's deployment of AI for understanding user preferences and stylist matching illustrate the diverse applications of AI in value creation.
Q & A
What is the main focus of Module 6 in the AI in Marketing certification course?
-Module 6 focuses on 'Customer Value and the Role of AI in the Value Delivery Process', discussing how AI is integrated into the marketing strategies and plans to enhance customer value.
What are the three phases of the value delivery process mentioned in the script?
-The three phases of the value delivery process are: choosing value, providing value, and communicating value.
How does AI contribute to the strategic and tactical aspects of marketing?
-AI contributes to strategic marketing by aiding in segmentation, targeting, and positioning. In tactical marketing, AI enhances the marketing mix (product, price, place, and promotion) through personalized experiences, real-time feedback, and operational optimizations.
What is the significance of AI in optimizing operations within the value chain?
-AI optimizes operations by improving efficiency, minimizing costs, and maximizing operational capabilities, which can lead to a shortened value chain, faster production speeds, and better inventory management.
Can you provide an example of how a company has used AI to improve operational efficiency?
-GD.com, one of China's largest retailers, introduced AI to drive efficiencies in their operations, achieving a 92% same-day or next-day delivery rate for orders.
How does AR Financial Services Group utilize AI in its business model?
-AR Financial Services Group uses AI and data from its core mobile payment platform to run a variety of businesses, including customer lending, money market funds, wealth management, health insurance, and even an online game that encourages reducing carbon footprints.
What is the role of AI in the value proposition and value chain strategy?
-AI helps in creating value propositions that appeal to customers by understanding their needs and preferences. It also focuses internally on operations within the value chain, improving the efficiency and effectiveness of business processes.
What are the primary and support activities in a value chain?
-Primary activities in a value chain include inbound logistics, operations, outbound logistics, marketing, and services. Support activities include procurement, technology development, human resource management, and infrastructure.
How can AI improve decision-making in the supply chain?
-AI can analyze data to make better decisions about the purchase of materials, storage capacities, production plans, and more, leading to reduced costs and improved efficiency.
What are the three forms of AI-driven value creation mentioned in the script?
-The three forms of AI-driven value creation are process efficiency, process enhancement, and product and service innovation.
What is the current state of AI adoption across different industries?
-AI adoption varies by industry, with high-tech and telecom companies leading the way, while industries like construction have a lower level of AI implementation. This difference in adoption rates could potentially widen the AI gap between industries.
What are the five elements of the emerging technology landscape according to the IDEAS framework?
-The five elements of the emerging technology landscape according to the IDEAS framework are Intelligence, Data, Expertise, Architecture, and Strategy.
Outlines
🤖 Introduction to AI in Marketing Strategies
The video script introduces Module 6 of an online certification course on artificial intelligence in marketing. It focuses on developing marketing strategies and plans using AI, with a particular emphasis on customer value and the role of AI in the value delivery process. The module aims to provide a background for understanding AI's implications in the customer value chain, exploring the emergence of AI in value delivery, and recognizing its importance in the value chain. It also discusses the current state of AI adoption in value chains and the level of industry adoption. The script outlines the value delivery process in businesses, which includes choosing, providing, and communicating value, and how AI can optimize this process for increasingly well-informed customers.
🛠️ AI's Impact on Value Chain Efficiency
This paragraph delves into how AI and algorithms are transforming traditional business processes to serve value more efficiently. AI applications, such as computer vision, deep learning, and robotics, are streamlining operations, improving production speed, and managing inventory flow. The script highlights the case of JD.com, a Chinese retailer, which has significantly increased operational efficiency through AI, allowing for same-day or next-day delivery. Another example is Nike, which uses augmented intelligence to design customized shoes within two weeks. The paragraph also discusses the rise of Ant Financial Services Group, which leverages AI and data to serve a vast number of customers with minimal human intervention, showcasing the potential of AI in operations and value chain delivery.
🔍 AI's Role in Value Chain and Strategic Decision Making
The script explains the relevance of AI in the value chain, which is a complex web of interconnected business activities. AI can improve efficiency and reduce costs by making better decisions about sourcing raw materials, storage capacities, and production plans. It also discusses how companies should reimagine their business models and work processes to capture the full potential of AI. The paragraph emphasizes the importance of core business processes in strategic decision-making and how AI can be incorporated into these processes for significant performance improvements. It also touches on the continuous improvement mindset required for AI transformations and the importance of ongoing AI adoption.
🚀 Forms of AI-Driven Value Creation
This section outlines the forms of value creation driven by AI, which include process efficiency, process enhancement, and product and service innovation. It provides examples of how AI can automate repetitive and challenging processes for humans, such as apple harvesting, and how it can enhance existing processes, like Salesforce Einstein's ability to prioritize high-value leads. The paragraph also discusses AI's role in creating new products and services, as demonstrated by Stitch Fix's use of AI for new clothing designs based on customer preferences.
📈 Current State of AI Adoption Across Industries
The final paragraph examines the current state of AI adoption in various industries, noting that the level of adoption varies significantly. It reports that while over 30% of high-tech and telecom companies have implemented AI technologies, only 15% of construction companies have done so, indicating a potential AI gap between industries. The script also mentions that traditional industries, such as manufacturing, retail, and healthcare, have legacy systems where certain types of AI can be deployed quickly to add value. It concludes by discussing the five elements of the emerging technology landscape—intelligence, data, expertise, architecture, and strategy—which will be detailed in the next module.
Mindmap
Keywords
💡Artificial Intelligence (AI)
💡Customer Value
💡Value Delivery Process
💡Strategic Marketing
💡Tactical Marketing
💡Marketing Mix
💡Operations Optimization
💡Value Chain
💡AI Adoption
💡Process Efficiency
💡Product and Service Innovation
Highlights
Introduction to Module 6 on developing marketing strategies and plans using AI, focusing on customer value and AI's role in the value delivery process.
The importance of understanding AI implications in the customer value chain and its emergence in value delivery.
AI's relevance and importance in the value chain, and its role in AI-driven value creation.
The value delivery process in business includes choosing, providing, and communicating value to customers.
Strategic marketing involves segmentation, targeting, and positioning to choose value, while tactical marketing focuses on the marketing mix for providing and communicating value.
AI's impact on optimizing the value delivery process through algorithms, rather than traditional business processes.
AI applications such as computer vision, deep learning, and robotics process automation that improve operational efficiency.
Case study of a Chinese retailer using AI to achieve 92% order delivery on the same or next day, showcasing AI's efficiency in operations.
Nike's use of augmented intelligence for custom shoe design, reducing the end-to-end process time to 2 weeks.
The rise of Ant Financial Services Group, using AI and data for a variety of businesses, serving more customers with fewer employees.
The value proposition and value chain strategy, focusing on the integration of demand and supply sides of the business.
AI's role in the value chain, from sourcing raw materials to reaching the end consumer, and its potential for improving efficiency and reducing costs.
United States Cold Storage's use of AI for automated appointment schedulers, reducing time and labor wastage.
The importance of examining cost and performance in value-creating activities and AI's role in improving them.
The need for companies to reimagine their business models and work processes to capture the full promise of AI.
The continuous improvement mindset required for AI transformation, as it is an ongoing process rather than a one-time effort.
AI's potential for process efficiency, enhancement, and innovation in product and service design.
Current state of AI adoption in value chains, with a focus on functional areas and industry adoption levels.
The importance of the IDEAS framework for companies investing in AI, covering intelligence, data, expertise, architecture, and strategy.
Conclusion summarizing the importance of customer value, AI's amalgamation with customer value, and its role in value chain and delivery.
Transcripts
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welcome to this nbdl online
certification course on artificial
intelligence in marketing and now we
will talk about module six so as you can
see from this slide now we are
discussing chapter 2 that is developing
marketing strategies and plans using Ai
and uh this is the first module in this
chapter 2 that is module six which talks
about customer value and role of AI in
value delivery process so let us start
with module 6 and these are the things
that we will talk about in this module
so to lay the background for
understanding ing AI implications in
customer value
chain so that is already there in that
Essentials of marketing course to
explore the emergence of AI in value
delivery to understand the relevance of
AI for Value chain to recognize the
importance of AI in value chain and to
explore forms of AI driven value
creation then we will talk about
understanding current state of AI
adoption in value chains and to gauge
the level of Industry adoption of AI now
let us look at the marketing and the
customer
value every business is a value delivery
system the objective of any business is
to provide customer value at a profit so
that is obviously an objective of of
every company the value delivery process
includes three phases phase one is the
choosing value phase two is providing
value and phase three is communicating
the value only by optimizing the value
delivery process and choosing providing
and communicating Superior value to
increasingly well-informed buyers can a
business ensures sustained success so
keep in mind that we are talking of
increasingly well-informed
customers the first phase of choosing
the value is the essence of strategic
marketing while the other two phases
namely providing and communicating value
is the part of tactical marketing so
this is a strategic marketing and these
two are tactical marketing choosing the
value through strategic marketing
achieved by the combination of
segmentation targeting and positioning
so these three things they form the part
of a strategic
marketing providing and communicating
the value is achieved by the means of
tactical marketing which is expressed
through the mix of product price place
and promotion together called as four
piece or the marketing mix so these four
piece
are providing and communicating
value and they are tactical
marketing while
STP is choosing
value and this is strategic marketing
strategic marketing and tactical
marketing when they come together they
constitute marketing strategy so major
marketing related tasks involved in each
phase are displayed in figure one on the
next slide so this is the value delivery
process the first is choose the value
the second is provide the value and the
third is communicate the value and this
is the value creation and delivery
process so here we talk of customer
segmentation Market selection and focus
and value positioning then we talk of
product development service development
pricing sourcing making and distributing
services and at the third is the sales
force sales promotion and advertising
and this is the value delivery
process
now let us look at the value delivery
process and AI there are hundreds of
different ways of optimizing the value
delivery process by deciding how form
will Source create sell communicate and
deliver value to the customers in recent
years the business world has seen the
emergence of artificial intelligence as
the main source of Val creation and
delivery so this is
why artificial intelligence is so
important for marketing that it has now
become a main source of value creation
and
delivery so there is a rise of new kind
of forms where value is served up by
algorithms rather than traditional
business processes operated by workers
managers process Engineers or customer
service Representatives Ai and
algorithms can help business understand
attract and retain their customers by
offering them Surplus value personalized
experiences and realtime feedback AI
also helps the efficiency of value Chain
by operation optimized for a firm so
that is another advantage that the
operations are optimized inefficient
operations slow down the movement of
products through the value chain moving
the customer further away from a
successful
purchase AI applications assisting with
operations optimizations are designed to
improve operations efficiency and
effectively by minimizing cost and Ma
maximizing operational capabilities
AI applications for this purpose include
AI related cnsi Services computer vision
deep learning Edge
AI intelligent applications machine
learning robotics process Automation and
virtual assistants all these AI
applications shorten the value Chain by
improving production speed and managing
inventory flow to the customer
streamlining operational processes
creates efficiencies across the value
chain for example gd.com one of the
China's largest retailers has introduced
AI to drive efficiencies in their
operations the introduction of AI
applications allowed the retailer to
deliver 92% of the order on the same or
the next day now you see this is the
amount of efficiency that they have
achieved Nik implemented augmented
intelligence to design customized shoes
for its customers and the end to endend
process only takes 2 weeks from the
design to customer delivery So within 2
weeks that is 14 days 14 to 15 days the
design and delivery happens optimizing
operations can offer unexpected benefits
by increasing operational
efficiency increasing agility and speed
across the value chain these
improvements should be driving force
behind implementing AI in operations and
value chain delivery now let us look at
the rise of anunt financial Services
Group uring the financial transformation
in 2019 just 5 years after the AR
Financial Services Group was launched
the number of consumers using its
services passed the 1 billion Mark AR
Financial uses artificial intelligence
and data from alipe its
core Mobile payment platform to run an
extraordinary variety of
businesses its businesses include
customers Lending
money market funds wealth management
health insurance and even an online game
that encourages people to reduce carbon
Footprints the company serves more than
10 times as many customers as the
largest US Banks with less than one 10th
the number of employees now you see this
is the
efficiency and Effectiveness that has
come
in they have 10 times more customers
with one/ tenth of employees unlike
traditional Banks investment
institutions and insurance companies
there is no manager approving loans no
employee providing Financial advice and
no representative authoring medical
expenses rather everything is being done
by AI without the operating constraints
that limits traditional forms AR
Financial can compete in unprecedented
ways and Achieve unbridled growth and
impact across a variety of Industries
next comes the value proposition and the
value chain value proposition is the
element of strategy that looks outward
to the
customers at the demand side of the
business the value chain focuses
internally on operations so that is
customer
facing and this is operations
facing the strategy is fundamentally
integrative bringing the demand and
Supply site together so a strategy links
value proposition and the value chain
and that is the job of a
strategy typically value propositions
based on needs appeal to a mix of
customers who might defy traditional
demographic segmentation now let us look
at what is value chain a value chain is
a tool for
identifying Key activities that create
value and costs in a specific businesses
so we are looking at the value and the
cost the value chain comprises primary
activities and support activities that
create value and cost in a specific
business and are performed
to
design produce market deliver and
support its
products so this is what a value chain
looks like so these are the primary
activities inbound Logistics operations
outbound logistic marketing and services
and these are secondary activities and
these are primary activities and
secondary activities includes
procurement technology development human
resource management and
infrastructure and the firm's
infrastructure so the the combination of
these primary and secondary activities
will lead to margin so if the
combination is is is good then this
margin may increase if it is
not good then the margins May
decrease now let us look at the
relevance of AI in value chain a value
chain is a complex interconnected web of
business
activities which is automated and
managed by several
stakeholders so keep in mind that it is
a complex interconnected web of business
activities some of them are automated
and they are managed by several
different stakeholders so there is no
one person that is or one organization
that is managing the value chain the
process begins with sourcing raw
material from suppliers and ends with
the product reaches the end consumer it
is a prime example of an environment
where artificial intelligence can help
improve efficiency and reduce cost
businesses can leverage AI to make
better decisions about the purchase of
materials so now you see that we are now
using AI to decide about the purchase of
material draw material storage cap
capacities production plans and and and
much more by understanding the use of AI
in the supply chain the United States
Cold Storage one of the largest cold
storage companies developed and
automated appointment schedulers to
accurately predict the arrival time of
carriers and the time taken to service
them while scheduling an appointment so
that reduces lots of wastages
wastages in terms of time in terms of
Labor and in terms of
money the firm's task is to examine its
cost and performance in each value
creating activities and look for ways to
improve it so all the value creating
activities we have to look for the cost
and performance and then how to improve
that the rise of AI Technologies is
generating Noel opportunities so now
with AI we can have Noel opportunities
for companies in each value creating
activity to create additional customer
value to capture the full promise of AI
companies must reimagine their business
models and the way work gets done the
Core Business processes are highly
relevant in a form's decision to a
incorporate AI in a strategic decision-
making processes so these Core Business
processes Define how to incorporate AI
in the Strategic decision- making
process when incorporating AI The Firm
should identify a crucial business
process also referred as domain and
rethink it completely introducing
changes throughout an entire core
process Journey or function which will
lead to a major Improvement in
performance that isolated application
simply cannot match it also will enable
each AI initiatives to build off from
the the previous ones for example
reusing data or advancing capabilities
for a common set of
stakeholders and trigger an organic
cycle of change within the domains and
ultimately build momentum for the use of
AI throughout the large organization as
Business Leaders and employee see it
work
moreover this approach promotes a
mindset of continuous Improvement in the
workforce so that mindset is also
important that comes in this Workforce
the mindset of continuous Improvement
which is crucial because AI technology
is advancing rapidly requiring
organizations to think of AI
Transformations as
ongoing rather than onetime
efforts so this AI transformation is
ongoing process it is not that you you
implement AI one time
and and then it ends no
no it is
continuous now let us look at the forms
of AI driven value creation AI is
improving precision and speed in many
value chains phases such as
Communication customer insights design
manufacturing deliver designing
manufacturing delivering and Retail
by improving the prion and speed of
these functions the following key
improvements are possible one is process
efficiency another is process
enhancement the third is product and
service Innovation so these are the
forms of AI driven value efficiency the
process efficiency process enhancement
and the product or service Innovation
now let us look at what AI efficiency is
and how AI process efficiency is and how
AI is going to benefit that so AI
automation often improves repetitive
processes that are not enjoyable and
challenging for humans for example
abundant robotics have designed AI
powered automated machines to harvest
apples reducing the amount of Labor
needed since manual apple picking is
physically demanding and labor Supply is
low Farms have an incentive to improve
this process so obviously this was a
time consuming and money consuming
process so Farms has had had an
incentive to improve this process the
next comes process enhancement AI can
also enhance existing processes leading
to better outcomes for the customers so
earlier we were talking about efficient
uh creating efficiency in the processes
now we are talking of enhancing those
processes so that uh it can lead to
better out outcomes for the users for
example Salesforce Einstein can provide
leads for a salesperson and hide those
that have a very low likelihood of
converting to a sale this enhances the
sales process allowing Executives to
debate high quality time to high value
leads so this matchmaking
makes the process enhances the process
the third is product or service
Innovation so AI can enable the creation
of new products and services as seen
with Stitch fix a personal styling
service e-commerce company AI can power
new product design using data from
multiple sources to predict
styles that can resonate with the
customers so now ai is being used for
new product
designs the company uses AI to identify
popular clothing features and recommend
new combination of these features to
stitch fix in-house design team so the
design team can can come up with an
entirely new product a different kind of
product so current state of a adoption
and value chain the first is the
functional areas of AI deployment
companies are experimenting with and
adopting AI Technologies across their
value chains most of these efforts have
been invested in non-core support
functions so we are talking of non-core
support functions in one survey of 3,000
professionals over 25% of respondents
reported having adopted AI in each of
the following support
functions one is the it so they are
using AI in it customer services
Marketing sales and Finance and
Accounting all all at all these places
the AI has been
deployed however in contrast to how
other new digital technologies have
entered the Enterprise companies are
also investing in uh investing in AI for
core
functions so till now the companies were
investing in non-c functions now the
company have also started investing in
core functions for ex for
example Stitch fix deploys deep learning
to understand a user's clothing
style so this is one type of AI to
understand the users clothing style
based on the Styles they like on P and
also deploys machine learning to match
stylists with users so on the one hand
it is coming up with new Styles and
other on the other hand it is also
matching stylist with the users next let
us look at the industry adoption level
so as to be expected the role of AI play
in value chain today varies by industry
so some are more some are at a higher
level of adoptions are at the lower
level of adoption so according to a
McKenzie report over 30% of Hightech and
telecom companies have implemented at
least one AI technology whereas only 15%
of construction companies have pursued
such advancements going forward there is
a risk that differing rates of adoption
could widen the AI gap between
technology focused Industries and other
Industries so obviously this technology
focused industry will adopt will use AI
more as as compared to the other
industry so while technology Centric
Industries may be investing in AI more
heavily than other
Industries opportunities still exist for
strong return on investment for targeted
application in more traditional
Industries so although AI is being used
in technology Centric industry but there
is a huge
scope of using AI in more traditional
and mature
Industries like your
construction Jim siai VP of product
marketing for Salesforce so
salesforce.com is the company Salesforce
Einstein advocated that because of a
very fact that traditional Industries
such as Manufacturing
retail and Healthcare have Legacy
systems certain types of AI can be
deployed relatively quickly and add
value so because they are they are
mature Industries so they have certain
types of uh Legacy systems but still in
those Industries also AI can be
deployed to add value so retail is in
the middle range of AI adoption and
investment growth so AI
adoption and investment growth and
investment coming back to AI uh and
value chain businesses can employ AI in
corporate support functions customer
predictions and content
Effectiveness companies that want to
invest in key digital Technologies such
as cloud computing and AI should focus
on five elements of emerging technology
landscape the five elements are
this emerging technology landscape the
five elements of which are intelligence
two data three expertise the fourth is
architecture and the fifth is
strategy which comes from ideas
framework so this ideas framework as you
can now
see it stand for intelligence data
expertise architecture and strategy and
that we will discuss uh in detail in the
next module so to conclude we have
discussed the importance of customer
value in marketing and studied the
customer value chain one second we have
discussed the amalgamation of AI and
customer
value the third we have discussed the
relevance of and importance of AI in
value chain and value delivery and then
we have understo we have explored the
three forms of AI driven value creation
which are process efficent icy process
enhancement and product and service
enhancements AI is being implemented
across the value chain in the functional
areas of
AI customer service Marketing sales
Finance and
Accounting and then finally we have
discussed the adoption level of AI in
different industry which is obviously
different at different points in time
across different Industries and these
are the books from which the material
for this module was taken thank
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you
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