How Artificial Intelligence benefits companies and ups their game | Livemint

Predictive analytics, diagnostics and recommendations: Predictive analytics has been in the mainstream for a while, but deep learning changes and improves the whole game. Predictive analytics can be described as the ‘everywhere electricity’—it is not so much a product as it is a new capability that can be added to all the processes in a company. Be it a national bank, a key supplier of raw material and equipment for leading footwear brands, or a real estate company, companies across every industry vertical are highly motivated to adopt AI-based predictive analytics because of proven returns on investment.

Japanese insurance firm Fukoku Mutual Life Insurance is replacing its 34-strong workforce with IBM’s Watson Explorer AI. The AI system calculates insurance policy payouts, which according to the firm’s estimates is expected to increase productivity by 30% and save close to £1 million a year. Be it user-based collaborative filtering used by Spotify and Amazon to content-based collaborative filtering used by Pandora or Frequency Itemset Mining used by Netflix, digital media firms have been using various machine learning algorithms and predictive analytics models for their recommendation engines.

In e-commerce, with thousands of products and multiple factors that impact their sales, an estimate of the price to sales ratio or price elasticity is difficult. Dynamic price optimization using machine learning—correlating pricing trends with sales trends using an algorithm, then aligning with other factors such as category management and inventory levels—is used by almost every leading e-commerce player from Amazon.com to Blibli.com.

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How Artificial Intelligence benefits companies and ups their game – Livemint.