5 Questions to Ask Your AI Vendor – Leveraging the Power of AI #6
AI will create trillions in business value within the next few years, but that cash won’t be distributed evenly. Not all AI is equal, and only distributors who invest in the right AI will profit. Knowing what questions to ask your AI vendor will put you in the position to capitalize on the AI value boom.
AI is predicted to create $2.9 trillion of business value in 2021. Yet, many distributors are not using AI, or are only using it in a limited way. The two main reasons companies struggle to deploy the profit-generating technology is that they lack a clear strategy for AI and don’t have employees with strong AI skill sets. Some businesses will develop AI internally. But for most, AI vendors are a better option.
AI vendors carry some upfront costs but offer valuable strategies, expertise and industry-specific experience. The challenge for distributors is deciding which AI vendor can bring the most value to their business. The following questions (and desirable answers) can help distributors distinguish which AI vendor to go with.
1. Do you use deep learning?
Preference AI vendors that use deep learning. Deep learning is a highly effective form of machine learning. If your vendor uses more basic predictive tools like segmentation and clustering, they won’t be able to identify complex patterns. Deep learning models can handle messy, real-world factors like seasonality, and deliver real results.
2. How often do you process data?
Look for services that process data frequently. Your vendor isn’t making the most of your data unless they collect it at least every day. AI is very effective at automating time-sensitive tasks, but only when it’s being fed live data. Re-orders, for example, are very time-sensitive. Re-order pitches and predictions only stay relevant for a few hours or days. If your AI is too slow to update, those sales will go to someone else.
3. What additional data will you help me capture?
Avoid vendors that don’t help you capture new data. Good AI doesn’t just understand your current data, it also finds new information. Data on customer intent is especially valuable, as it grows 10x faster than customer purchase data. Vendors that help you capture this information will give you a competitive advantage that will only grow as time and data accumulate.
I’ll explain this fully in a later post, but Amazon’s success has been driven partially by its ability to capture and analyze intent data. Amazon doesn’t need to be feared, but it should be emulated. The right AI vendor will help you dominate B2B by leveraging the strategy and technology that Amazon used to conquer B2C.
4. How will you secure my data?
Make sure your AI vendor stores data in a virtual private cloud. Also, check that their API keys have permission down to the API route. This sounds technical, but it basically just means having the ability to regulate which users have access to which bits of data. Robust systems will store all of your data securely and give you control over who sees what.
5. How will you use my data?
Your data is a valuable corporate asset. Make sure that you’re the one who gets to capture its value. Avoid distributors who might move data out of the cloud without you knowing, or who sell data to third parties. Even if your data is anonymous, rivals can still use it to their advantage. Plenty of vendors handle data responsibly, so there is no need to worry about data security issues as long as you’ve done your due diligence.
If these questions feel very data-centric, that is because they’re supposed to be. Data holds immense potential for profitability. The challenge for distributors is finding the right AI vendor to unlock that potential. These questions should help.