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How AI insights improve decision making

Artificial intelligence-driven analytics tools sift through massive datasets to identify patterns, trends and insights humans might overlook—allowing brands a distinct competitive edge by making strategic decision-making easier and improving customer experiences. Sprout’s 2023 State of Social Media report confirms these advantages, with 9 out of 10 business leaders acknowledging the indispensable role of AI in enhancing market competitiveness, understanding customer preferences and driving innovation. These leaders also expect their companies to increase investment in AI for marketing in the next three years.

Incorporating AI technologies into business operations optimizes performance and pushes organizations toward success and sustainability. For long-term success, companies may face challenges when implementing this technology due to a lack of understanding and organizational experience with AI.

In this article, we’ll explore what AI insights are exactly, how they work and how they’re applied practically to progress different industries.

What are AI insights?

AI insights are the knowledge and understanding gained by analyzing complex datasets using AI. This process involves a combination of machine learning (ML), natural language processing (NLP) and AI data visualization techniques (charts, graphs, dashboards, heat maps, etc) to make the data more accessible.

The visualization helps strategists find hidden patterns, trends and correlations. Organizations use AI tools to filter big data into actionable intelligence to support better decision-making and strategies.

Advantages of using AI for generating data insights

AI analytics offers many advantages, such as seeing hidden trends in large data sets, forecasting future market behaviors, analyzing customer sentiment, making decisions faster and creating personalized experiences.

Easier decision-making

AI insights arm decision-makers with comprehensive, real-time data analysis, reducing reliance on guesswork and intuition. The AI processes and analyzes data from various sources simultaneously at a speed and scale unattainable by human effort alone. As such, the insights can give you an in-depth view of the market, customers and competitors.

Predicting future trends

AI insights provide the power to predict future trends and customer behaviors through pattern recognition in data. By analyzing historical information, AI tools can forecast outcomes, offering a clear view of customer preferences and potential market shifts. This capability enables you to adjust your strategies proactively and remain competitive. Notably, 45% of business leaders recognize predictive analytics as AI’s most valuable marketing tool, allowing for precise forecasting of future customer behavior.

Creating better customer experiences

The secret to captivating your customers is in understanding their desires, expectations and perceptions of your brand, then turning those feelings into experiences people love. For example, you can anticipate customer needs and gauge opinions through social media listening to monitor chatter around your brand or competition. This empowers you to proactively tailor your offerings and marketing communication. A study by Boston Consulting Group found that companies using AI insights for personalization saw sales gains of 6-10%, which is two to three times greater than those not using AI.

How AI insights help businesses

Let’s explore how AI insights help industries strengthen business strategies, meet market needs and boost brand loyalty.

AI insights for automotive

AI insights improve automotive manufacturers’ understanding of consumer sentiment, market trends and product feedback. Through social listening and text mining, companies can tailor their designs, features and marketing strategies to meet consumer demands, enhancing customer satisfaction and loyalty.

For example, a car manufacturer can use review and AI-driven sentiment analysis to gauge global consumer reactions to product recalls. This in-depth investigation can reveal significant regional differences in perception and enable targeted, culturally sensitive crisis management strategies.

AI insights for banking

In the banking sector, AI insights are vital for fraud detection. But they’re also commonly used in customer service and the personalization of banking solutions. By analyzing transactional data and customer feedback, banks can improve their security and offer services that truly help their customers.

As an example, let’s look at a bank that wants to improve its customer service. The bank can use AI-driven sentiment analysis to dive deep into customer feedback, collected through social media listening campaigns. This comprehensive analysis, which can be conducted in multiple languages, helps the bank identify essential improvement areas, such as mobile banking, fees and branch services. The insights can help the bank initiate targeted reforms, such as overhauling the website experience or improving branch operations to boost customer satisfaction and loyalty.

AI insights for call centers

Using AI insights in call center operations can boost efficiency and pinpoint problem areas. For example, a mobile carrier can utilize AI-driven sentiment analysis to tackle customer churn by integrating text analytics with their call center software. This approach converts call voice data into text for real-time sentiment analysis, allowing proactive identification of customers at risk of leaving. By offering timely resolutions and incentives, the carrier can reduce its churn rate, improve agent effectiveness and overall customer satisfaction.

AI insights for finance

AI insights play a role in understanding market dynamics and enhancing strategic planning in the financial industry. For instance, a hedge fund can enhance its trading strategy by employing real-time sentiment analysis and entity extraction to analyze international market sentiment. This involves processing extensive data from varied sources, including news in multiple languages relevant to its global operations. The hedge fund can integrate market sentiment directly into its trading models by developing a sophisticated dashboard to compare market sentiment with share prices, optimizing its decision-making process.

AI insights for government

Governments can use AI insights to improve public services and policies and engage with communities. For example, predictive analytics can help the government anticipate public service bottlenecks, allocate resources efficiently and minimize service downtimes. At the same time, text analytics can monitor public concerns on social media. Helping to monitor, analyze and extract insights from public sentiment. This approach can help officials identify similar complaints or praises, and find areas that require immediate attention.

AI insights for health and pharma

AI provides valuable insights that significantly improve patient care and drug development in the healthcare and pharmaceutical sectors by efficiently structuring complex medical data. An example could be a hospital network leveraging NLP-based text analytics to transform unstructured EMR progress notes into searchable and organized data. This approach helps the hospital extract actionable insights on medication effectiveness and patient outcomes. By applying named entity recognition, the hospital could analyze detailed information about medications, dosages and patient responses, enhancing patient care precision.

AI insights for hospitality

AI insights have the potential to revolutionize the hospitality industry, empowering businesses to cater to guests’ preferences in a more personalized way. One of the key innovations in this field is the semantic analysis of hotel reviews that offers highly tailored recommendations to travelers. While traditional five-star ratings are widely recognized, they often fail to capture the unique needs of individual guests.

By semantically analyzing text-based reviews, a hotel review aggregator could develop a “smart” search feature that allows hotels to be filtered based on specific attributes such as breakfast quality, internet speed or proximity to nightlife, aligning directly with the traveler’s preferences. This approach goes beyond generic ratings to provide customized hotel recommendations, improving the guest selection process and enabling people to have more personalized travel experiences.

AI insights for quantitative trading

AI insights are transforming quantitative trading by leveraging unique data sources, such as employee feedback, to predict company performance. For instance, a hedge fund might analyze employee sentiments on platforms like Indeed and Glassdoor, theorizing that internal sentiments predict market trends. Sophisticated sentiment analysis allows the fund to categorize employee reviews, unveiling trends in company health and potential. This approach uses unconventional data to give traders an edge, offering a novel angle on investment strategies.

AI insights for market research

AI insights revolutionized market research, enabling marketers to extract valuable competitive insights from a large consumer base quickly. Consider a new healthy snack brand, analyzing thousands of consumer surveys and open-ended responses about snack preferences and brand recognition. Through AI-driven data extraction, the brand can quickly categorize responses, pinpoint key themes and identify mentioned brands. This analysis offers the newcomer precise market positioning insights, including identifying indirect competitors like essential vegetables. With this knowledge, the company can strategically focus its marketing and product positioning efforts to maximize success in its core markets.

Understanding how AI insights are generated

As you can see, many industries use AI for sentiment analysis to provide an in-depth understanding of their customer behavior. As an example, this section will walk you through how AI processes numerical and textual data to give you better customer insights.

Step 1: Data collection

The first step involves collecting the data for analysis. This can be social media posts, customer reviews, surveys, customer care logs, NPS scores and emails. The aim is to gather a comprehensive dataset that reflects the sentiments and opinions of the target audience about your brand or product. The data can be uploaded directly through APIs or manually entered as CSV files.

For example, let’s say we wanted to understand people’s sentiments around Sprout Social across social media and review platforms.

An X (formerly Twitter) post from a fan of Sprout Social's AI Assist

A LinkedIn post from a Sprout Social employee describing the positive work culture.

Step 2: Data processing

Once collected, the AI tool processes the text or numerical data using AI and ML algorithms tailored to interpret and analyze the specific data type. For text, the tool uses subtasks like NLP and text analysis to understand the language, converting sentences into structured formats that machines can work with. It also understands emojis. This enables the AI tool to perform tasks like sentiment mining, language translation or text generation by finding patterns and relationships within the data. Numerical data is processed using statistical and ML models that can identify trends, classify data into categories or predict future values.

The neural networks (NNs) in these tools help them learn from the data they analyze and adjust their parameters to accommodate new information. This continuous learning mode improves the accuracy over time.

In the Sprout Social example, AI would use NLP and text analysis to decipher complex language nuances, emojis and sentiment within social media posts and reviews – transforming the open-ended feedback into structured data.

Step 3: Data analysis

The tool analyzes the processed data by picking out important parts or patterns it is trained to recognize from pre-processed, labeled datasets. For text, this could be things like the tone of a message or the main topics discussed. With numbers, it might look for trends or unusual patterns. The AI uses special algorithms to sift through this data and learn from it, improving its tasks over time by adjusting the internal rules to reduce mistakes.

For the Sprout Social case, the structured data gets analyzed to detect prevalent themes, such as sentiment tones and customer concerns. This step is important for understanding the broader sentiment landscape identifying strengths and potential areas for service enhancement based on the collective feedback.

Step 4: Visualizing the data

Data visualization is the last step that involves the tool transforming the data into intuitive graphs and charts, making it easier to digest and understand. Visualization helps you identify trends and outliers in the data, offering a granular view that can influence decision-making. For Sprout Social, this could mean a graph that tracks sentiment trends or compares service perceptions across different demographics. These visualizations provide a clear, at-a-glance understanding of how the brand is perceived, enabling Sprout Social to make informed decisions on service improvements or marketing strategies.

Sprout Social’s sentiment analysis tools showing negative and positive sentiment scores and identifying sentiment trends across timelines

The future of AI adoption

Despite AI’s capacity to sift through and make sense of big datasets and produce actionable insights, only 20% of strategists harness AI-related tools, such as ML or NLP, within their strategies. This highlights a wealth of untapped potential, where AI’s capabilities can improve business strategies, giving adopters the opportunity to innovate and create great customer experiences.

To incorporate AI insights into your own marketing strategy, social media data is an excellent starting point. As one of the world’s biggest readily available datasets, using tactics like social media listening will provide you with real-time insights into your customers and market.

Next, learn how marketers are leveraging AI in marketing to generate content, automate operations and create powerful campaigns.

The post How AI insights improve decision making appeared first on Sprout Social.

March 20, 2024

Original Source https://sproutsocial.com/insights/ai-insights/

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