Market Trends of Industrial AI Software Industry
Retail and Consumer Packaged Goods is Expected to Hold Significant Share of the Market
- Factors driving expansion include the ever-increasing number of internet users, smart gadgets, the necessity for surveillance and monitoring in physical stores, and government initiatives encouraging digitization. Artificial intelligence (AI) in retail is based on how firms have operated over the last few decades. According to ITU, the estimated number of internet users globally was 5.4 billion as of 2023, up from 5.3 billion in the previous year. This share represents 67 percent of the global population.
- AI solutions and Big data analytics are essential to digital business; they have the potential to alter everything from customer experience to business processes. Artificial intelligence drives faster firms' decisions in e-commerce, marketing, product management, and other business areas by decreasing the gap from insights to action. According to the United States Department of Commerce, retail sales in the United States are expected to reach USD 5.99 trillion in 2023.
- Further, the rise in retail stores would create an opportunity for AI players to develop new tools to cater to a broad range of retail customers. For instance, According to the United States Bureau of Labor Statistics, in the 3rd quarter of 2022, there were 1,061,539 private retail trade establishments in the United States, which is a rise from the 1st quarter of 2022 private retail establishments, i.e., 1,049,543. Further, according to the National Bureau of Statistics of China, there were 292,383 retail chain stores in China last year.
- Moreover, according to MIT Technology Review Insights and Amazon, about half of the retail and consumer goods industry respondents state that deploying AI can help improve customer care. This means an AI solution could take over augmented conversations to respond to client questions and lead the customer to the right agent when it cannot assist. Additionally, 47% of respondents said that AI could significantly improve inventory management by helping to manage costs and buyers' needs. AI tracks quantities of supply and demand at both e-commerce sites and physical locations, ensuring they are in sync.
- Moreover, various retail firms are adopting AI to provide better services to customers. For Example, ThredUp, an online consignment business, introduced Goody Boxes, comprising different used apparel items tailored to each customer's style. Customers keep and pay for the things they want while returning the ones they don't. An AI algorithm recalls each customer's preferences so that future boxes are more tailored to their interests. Customers prefer non-subscription boxes overlooking individual parts.
- According to the National Retail Federation, Seven & I Holdings, the parent company of the 7-Eleven retail chain, had over 40,000 retail stores in operation worldwide in 2022. 7-Eleven is a chain of convenience stores that operate in many countries globally. That year, Seven & I had more retail stores than any of the world's leading retail companies, such as Walmart, which had nearly 10,500 retail outlets, or the Schwarz Group, with some 13,750 stores. Although Walmart was not the company with the most locations, it was the world's leading retailer. Such a huge number of retail stores would create an opportunity for market players to develop new solutions to capture the market share.
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North America is Expected to Hold a Significant Share.
- The market for artificial intelligence (AI) solutions in various industries is growing in North America, with the United States leading the way. In North America, the readiness for adoption and high fractional growth in replacement AI are the foremost drivers of their economic impact, which reflects the region's leading stance on artificial intelligence and its implementation. Moreover, the high automation potential is expected to occur at the regional level shortly, and it is also aiding the cause.
- According to the National Science and Technology Council report, In Fiscal Year 2022 (FY22), the Federal Government spent USD 8.76 billion USD on research and development in information technology, up USD 410 million or 4.9 percent from the year before. According to the study, USD 2.58 billion was spent on AI research and development in FY22 by all Federal research organizations. This is an increase of USD 130 million (+5.3%) from the prior fiscal year.
- Furthermore, ccording to the report, NSF (USD 654 million), NIH (USD 551 million), DARPA (USD 457 million), and the Department of Defense (USD 391 million) were the top funding sources for AI R&D in FY22, with DOE Office of Science (USD 130 million) following closely behind. Such massive spending on Artificial intelligence would create an opportunity for the players to develop new solutions to expand their market share.
- The benefits of AI solutions in the industry would enable the region's food and beverage players to deploy AI to commission new plants. For instance, in February 2023, SunOpta, a global pioneer fueled by the future of sustainable, plant-based, and fruit-based food and beverages, is pleased to announce the launch of its new plant-based beverage production facility in Midlothian, Texas. The new mega-factory will produce a whole line of plant-based milk, creamers, tea, and other items. Package sizes and configurations will include 16-ounce and 32-ounce packages used in food service, shelf-stable retail, and e-commerce for plant-based milk products, as well as 330-milliliter bottles used broadly in high-protein nutritious beverages.
- There is growing evidence that artificial intelligence (AI) is poised to significantly impact the practice of medicine in Canada. The development of the Critical Care Suite and the pneumothorax algorithm was made possible by the launch of GE Healthcare's Edison platform. Edison allows seamless uploading and sharing of images from partnering hospitals and provides a shared Web-based workspace on which radiologists from different organizations can curate and annotate the images, an essential prerequisite to training an algorithm. Humber River Hospital in Toronto, one of four institutions to sign a data-sharing agreement for developing the Critical Care Suite, provided 156,000 privacy-compliant chest X-rays and associated reports to GE Healthcare.
- Further, in September 2023, Google Cloud and technology company Continental announced a strategic partnership to provide innovative, flexible, and future-oriented digital solutions for the automotive industry. The partnership will combine Continental's expertise in automotive technology with Google's data and AI technologies to create a new generation of safe, efficient, and user-focused automotive solutions. Furthermore, the two parties expect to expand their strategic partnership into additional fields of collaboration in the future to build greater in-car connectivity and experiences for customers.
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