Gen AI Adoption? Focus On The Customer

Fifty-three percent of U.S. CEOs are finding use for generative AI according to Chief Executive and a similar study conducted by McKinsey and Co. declared that 2023 is a breakthrough year for the technology.

However, inaccuracy, intellectual property infringement and cybersecurity are among the primary concerns causing hesitation among executives. While I am confident that those matters will be resolved, as they always are over time when it comes to new technologies, a critical question has been left unanswered—if it was even asked. What is the impact of Gen AI on customers?

Most will consider that question from the perspective of the customer utilizing gen AI as part of the new services provided by the organization. This is not the real question. Customers will adapt and use it, mostly because companies will not leave them with many options, as they always do when introducing digital transformation and outsourcing their services to their customers.

The real question is what it does to the customer’s mindset—and what you need to do to adapt.

The Last Frontier of Authorities’ Demise

Over the past two decades, we have witnessed an unprecedented empowerment movement among customers. It began with knowledge empowerment, democratizing access to knowledge, insights and research for everyone. This movement fundamentally challenged traditional knowledge authorities, forcing them to reevaluate their value to customers. Today, individuals are no longer reluctant to challenge physicians; instead, they often act as experts seeking second opinions.

The service empowerment era saw companies entrusting their sales, service and marketing to customers through digital transformation tools, effectively turning customers into supermarket cashiers, bankers, travel agents and check-in experts. The rise of influencers is a testament to the sharing empowerment facilitated by social media tools like YouTube, Instagram and TikTok. The gig economy, in its various forms, disrupted traditional consulting firms, hotels and taxi services, effectively eroding long-established customer-vendor relationships.

With Gen AI, customers have reached the pinnacle of empowerment: they’ve become creators. They can now craft art, literature and more without needing expertise. This shift represents the ultimate declaration of customer independence.

The Rise of the One and Only Customer

Historically, during the Industrial Revolution and the subsequent mass customization era, customers were dependent on their vendors. They held the wallet, while vendors dictated everything from brand identity to design, production and delivery. Being a customer meant relying on others to tell you what you wanted, how you wanted it, and how you would receive it.

Empowerment gradually shifted the balance of power to customers. They were compelled, often in the name of convenience, to become more knowledgeable, make decisions, and lead various services. Customers started to realize that dependence was not a prerequisite for these relationships. They discovered their voices and power and began reshaping these relationships. The influencer market’s exponential growth exemplifies this shift, with a projected valuation of $139 billion by 2030, according to Skyquest.

With Gen AI, this transformation will reach a tipping point. Customers, now fully empowered, are becoming their own brands. Companies, in turn, are evolving into platforms of fulfillment.

Redefining Customer Engagement

The paramount question organizations must grapple with is how Gen AI reshapes customers’ mindsets and redefines their relationships with vendors. The rapid adoption of technologies like ChatGPT suggests that we are on the cusp of a profound shift. Millions of creators are emerging, staking their claim as their own brands, and demanding a radically different relationship with their vendors.

Assuming that customers’ empowerment has reached the tipping point of becoming their own brands, here are the questions every organization ought to ask itself as it charts the future strategy:

1. What do the one and only customers need from us?

2. What is our expertise, technology, knowledge and innovation relevant for the new one and only customer?

3. What in our current business operation we ought to stop doing?

4. What mindset or paradigm do we need to change?

5. How would we define our future value proposition?

6. What is our balance of roles and powers with the one and only customers?

7. What new skills, technologies, expertise and knowledge do we need to acquire to be even more relevant for the one and only customers?

8. What is the monetization model?

While Gen AI holds the potential for cost reduction and value addition to products, its most significant impact lies in reshaping the customer-vendor relationship. It ushers in an era of customer independence, compelling organizations to reimagine their relationships with these autonomous customers and redesign their engagement models.

In a world where customers are becoming the brand, the question we must answer is: Who are you in this transformative landscape?