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   The paradox of AI: problem vs. opportunity in web innovation   
      
   Date:   
   Mon, 31 Mar 2025 06:39:02 +0000   
      
   Description:   
   The AI boom raises big questions. The answer? Start with real problems, not   
   just hype.   
      
   FULL STORY   
   ======================================================================   
      
   AI has dominated headlines, product strategies, and investment for the past   
   two years, but as businesses reflect heading into 2025, an uncomfortable   
   question lingers: where is AIs financial impact, really?    
      
   Amidst the AI hype climate, businesses have been eager to invest in emerging   
   technologies that promise the world. So eager, in fact, that the market is    
   now saturated with hastily-developed products designed more to showcase   
   adoption than to deliver measurable impact.    
      
   While AI tools have existed for some time, the rise of generative AI     
   starting with the release of ChatGPT just over two years ago  has captured   
   broader attention and rekindled a frenzy of innovation, akin to the dot-com   
   boom of the late 1990s. Generative AI's accessibility is lowering barriers to   
   entry, sparking both a rush to investment and concern across industries.    
      
   When applied strategically, its clear that AI can revolutionize user   
   experiences at places like websites, where the potential for customer   
   experience enhancement is unparalleled. But to keep up with lofty AI   
   predictions and heavy investor demands, many businesses today are investing   
   first and looking for ways to measure return on that investment later  an   
   approach thats led to over-promised and under-delivered initiatives, followed   
   by disappointment among customers and teams alike.    
      
   AI has the potential to deliver transformative outcomes when businesses align   
   it with strategic goals, such as improving website functionality and user   
   satisfaction. Rather than integrating AI first and looking for a problem to   
   solve later, its time to return to the tried and true formula for innovation:   
   find a problem, figure out how to solve it.   
      
   The AI Paradox: ROI vs. FOMO    
      
   ROI must be the central factor in AI investment decision-making.    
      
   While the number of senior business leaders investing $10 million or more in   
   AI is set to double next year, a Gartner report found that at least 30% of AI   
   projects will be abandoned by the end of 2025. These circumstances  high    
   costs and low success rates  make prioritizing business needs and ROI   
   critical.    
      
   AI is an expensive, time consuming endeavor  so in order for an AI product to   
   be worth it, especially in consumer-facing applications, it must add real   
   value to customers. Rushing to bring high-potential technology to market can   
   often hinder, rather than enhance, user experience  particularly in the case   
   of websites, where users increasingly demand seamless interaction.    
      
   The early surge of businesses racing to adopt AI chatbots is a prime example.   
   In the push to get the latest feature onto their websites, a critical    
   question was often overlooked: will this actually improve our customer   
   service? Despite their high-potential, chatbots were introduced widely before   
   the technology was developed to the point of adding proper value, often   
   resulting in frustrating user experiences and failing to provide accessible   
   support.    
      
   Consider Watsonville Chevys viral failure, where a chatbot offered to sell a   
   customer a brand new Chevy vehicle for only $1. Rather than helping customers   
   buy cars, the under-developed technology  despite its high-potential  caused   
   an embarrassing headache for the dealership. More than the technology itself,   
   this failure underscores the critical importance of businesses putting   
   appropriate guardrails in place. Effective AI implementation requires not    
   only understanding the potential of off-the-shelf solutions, but ensuring    
   they are adapted to the specific needs and limitations of the business   
   environment.    
      
   In another recent counterproductive AI use case, Spotify whiffed on its   
   perennially popular Wrapped feature by going all-in on AI. While removing   
   features like top genres, the music streaming giant opted to add experiences   
   like an AI-generated podcast. Listeners, predictably, were critical,   
   highlighting the importance of using AI to enhance user experience rather    
   than diminishing features that made products popular in the first place.    
      
   Businesses must ask themselves: is this AI use case truly adding to the   
   customer experience? Investments must prioritize functionality and customer   
   needs over hype. By focusing on thoughtful, ROI-driven AI adoption,    
   businesses can avoid costly mistakes and improve outcomes.   
      
   Solving Problems, Driving Results   
      
   But of course, not every AI investment is destined to fail or hinder customer   
   experience. There are many examples of how AI brings clear value-adds when   
   implemented strategically, especially in ecommerce and content.    
      
   In a crowded online environment, frustrated users are a sales killer   
   customers have access to limitless products and content online, so when their   
   search fails to draw results, they leave.    
      
   Netflix, Google and Amazon have all dominated their respective verticals for   
   several years in no small part because of their use of natural language   
   processing. In 2017, more than 80% of the TV shows users watched on Netflix   
   were discovered through its recommendation system. In 2012, 35% of purchases   
   on Amazon came from product recommendations. Google has utilized AI since    
   2015 to process and provide more relevant search results.    
      
   All of these use cases have had a tangible impact on customer experiences  an   
   impact that has long differentiated them from competitors with less    
   resources.    
      
   More recently, the rise of generative AI is amplifying this trend  as the   
   current AI frenzy has led to not only the development of cutting-edge   
   technology by major AI players, but also made it more accessible for   
   businesses of all sizes. These advancements enable even mid-market players to   
   leverage tools once exclusive to industry giants, creating new opportunities   
   for differentiation and growth.    
      
   In short, these technologies are no longer limited to just big tech like    
   FAANG  AI democratization is unlocking more cost effective tools for SMBs and   
   mid-market companies to optimize their websites. The potential of AI is   
   immense when businesses choose the right product, and legacy examples in   
   e-commerce and user experience, like Netflixs recommendation engine or    
   Amazons personalized shopping, offer a blueprint for websites leveraging AI    
   to create transformative, ROI-driven outcomes. AI-driven smart search and   
   recommendation technologies already exist; businesses just need to evaluate   
   problems and responsibly implement solutions to unlock AI's transformative   
   potential.    
      
   Starting with the pain point  such as low conversion rates  and answering    
   with AI empowers better business outcomes. Implementing AI technologies can   
   help bridge the gap between mid-market companies and enterprises, drive    
   higher conversion rates and justifiable ROI for the cost of AI.    
      
   Thoughtful AI integration has the potential to revolutionize industries, and   
   in some cases, already has. These use cases underscore AIs potential to add   
   real value, making a tangible impact on conversion rates and customer   
   experience.    
      
    This article was produced as part of TechRadarPro's Expert Insights channel   
   where we feature the best and brightest minds in the technology industry   
   today. The views expressed here are those of the author and are not   
   necessarily those of TechRadarPro or Future plc. If you are interested in   
   contributing find out more here:   
   https://www.techradar.com/news/submit-your-story-to-techradar-pro   
      
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