Beginning Your AI Journey: How to Utilize AI to Meet Your Business Objectives
Generative AI is transforming business at a breathtaking pace. For the jewelry and diamond industries, this rapid shift is already helping early-adopting businesses to enhance everything from operational efficiency, design, and marketing, to improving the customer experience.
With so many possible use-cases, it's essential to take a strategic approach to ensure any investments you make in AI deliver tangible value for your business and your customers. AI will not be your magic wand or quick fix if there are deeper problems in your operating model; it is a tool, and like all tools its power comes from those who use it. The key is to align your AI initiatives with specific business objectives, ensuring the technology can help you create measurable impact. That’s why we are providing you with tangible examples and practical use-cases you can begin implementing in your business today.
“The bottom line: Investing in a technology that’s not connected to your organization’s strategy will result in value loss, not gain. [1]”
Identifying how AI can support your business objectives
Your first step should be understanding what you want AI to help you achieve. Are you looking to streamline your supply chain, improve customer personalization, drive better inventory management, or enhance overall customer satisfaction?
Each objective requires a different approach to AI, and understanding these distinctions is crucial to making informed decisions. A key part of that decision-making is to first analyze where your company is using analog or manual solutions for challenges that AI could overcome more effectively.
Operational efficiency
For brands aiming to optimize their backend processes, AI can help reduce manual workloads, enhance forecasting accuracy, and minimize errors. Machine learning algorithms can analyze the turn of products based on complex combinations of attributes such as metal content, color, and ring size to better predict buying or manufacturing needs. AI can also help identify potential supply chain disruptions–for example, alerting you to gem shortages when mine workers go on strike. This lets you quickly find new sources, adjust production, or inform customers of potential delivery delays. It can also prompt you to pre-sell limited inventory that may become more valuable.
As another example, AI-driven demand forecasting can help jewelry manufacturers optimize gold findings production. By analyzing demand trends across many items, including gold color preferences, seasonal variations, and regional differences, AI can offer insights into levels of raw materials and inventory that are required. This optimization prevents overstocking, reduces holding costs, and improves efficiency, protecting your operating margin, especially as gold prices rise [2].
Once your operations are streamlined, AI can help improve your competitive edge with agile pricing strategies.
Optimizing pricing strategies
AI can analyze competitors' prices, match offers, and adjust dynamically. This kind of automation saves time and reduces costs, ensuring your pricing is always market-responsive. For jewelry items, where visuals and the minutiae on the product detail page can be compared through scans of competitors' websites, AI can help your business adjust pricing to match the market as well as meet Sale offers. For marketing and promotions, as well as dynamic pricing, AI can quickly do "competitive shopping" of your competitors' websites, saving hours for your team who would have otherwise spent that time going from website to website, painstakingly clicking one item at a time.
Customer personalization
In our luxury jewelry market where clients expect a high-touch service, AI can help jewelry and diamond brands deliver hyper-personalized experiences at scale. AI-driven analytics can help you understand customer preferences and behaviors, allowing you to create targeted marketing campaigns, offer personalized product recommendations, and ensure every customer interaction feels unique [3].
In luxury retail, Prada has introduced AI into its customer experience to drive greater personalization [4]. Both in-store and online, Prada is using AI to help customize product recommendations, ensuring that customers receive the most relevant and appealing options based on their preferences and shopping history. Sales assistants in many Prada stores are now using mobile devices which can recognize returning customers, access their shopping history, and offer personalized recommendations powered by AI. Beyond personalization, AI can further enhance customer engagement by analyzing preferences and behaviors in real time.
Customer engagement and marketing
Accenture estimates that up to 95% of customer interactions are expected to be AI-enabled by 2025 [5]. Personal relationships are the biggest driver in our industry. You should use AI to support this by leveraging it to analyze your customer data, including demographics, preferences, and behaviors to help your marketing team create highly targeted content that resonates with specific audience segments. This will lead to increased conversion rates and more efficient use of marketing budgets. AI can help analyze customer data to create avatars of ideal clients, to develop look-alike audiences with greater accuracy, further guiding the decisions made for each audience segment. Furthermore, AI tools can be used practically in marketing content, such as predicting the best day and time to send out a newsletter for maximum open and click-through rate. AI can also help enhance your website experience, and speed content building, by giving your team the ability to quickly change photo backgrounds or create product descriptions in bulk.
Chatbots and AI-powered virtual assistants are able to engage with customers across multiple channels, providing instant responses to inquiries and improving overall brand interaction. For example, online jewelry brand, James Allen, introduced a ChatGPT website plugin last year which allows customers to discover jewelry based on their preferences and allows them to personalize their shopping experience [6].
Implementing AI in these ways can significantly enhance both operations and customer interactions. However, to truly capitalize on these benefits, it's essential to measure how these initiatives contribute to your overall business objectives.
Ensuring your business is ready for AI implementation
Once you’ve identified the areas where AI can best support your business goals, it's crucial to assess whether your organization is ready to move forward. The journey to adopting AI can be complex, and taking the time to evaluate your preparedness will help ensure success from the very beginning. There are some key questions to ask before you get started:
Is your leadership aligned?
Strong leadership buy-in is essential for AI to succeed. Does your leadership team understand AI and fully support its integration into the business? If the answer is no, then you have to create a compelling story to demonstrate its potential. Embracing AI means transforming your business, and that’s impossible unless your leadership is aligned.
Is your IT infrastructure good enough?
AI solutions require robust technology for data processing, storage, and integration. Assess whether your current infrastructure is sufficient or if you need to upgrade. Additionally, if working with external vendors, ensure you know what questions to ask—such as those related to scalability, data security, and integration capabilities—to align their offerings with your needs effectively.
Does your team have the right skills?
Maximizing AI’s potential for your business is more than just learning how to prompt ChatGPT effectively. If you are serious about building custom AI models to meet your needs then you need to ensure your team has the technical expertise, including data science, coding and machine learning expertise. Consider whether you need to invest in hiring or upskilling your workforce to fill any skills gaps.
Can you get high-quality data?
Data is the foundation of AI, and the quality of your AI outputs is directly tied to the quality of your data. Is your data clean, organized, and comprehensive enough to train effective AI models? Additionally, do you have the infrastructure in place to handle the safe storage and processing demands of large datasets?
Is your organization ready for change?
Making an honest assessment of your business’s capacity for change is essential if you are considering how to scale your AI efforts. AI adoption can impact roles, workflows, and overall culture. How open is your organization to change, and do you have a plan for addressing employee concerns and potential resistance? Encouraging a culture that embraces learning, innovation, and flexibility will be crucial in ensuring a smooth transition.
Taking your first steps strategically
These questions are not meant to deter you from embracing AI but to empower you to start your AI journey with confidence. By addressing them early on, you can build a solid foundation for AI initiatives that will create real value and drive lasting success for your business.
If you are thinking about how to get started, you should begin with small pilot projects, identifying the areas where implementation is likely to move the dial most quickly. Quick wins are important to get any doubters on your side before expanding your efforts.
Then begin to slowly scale up, monitoring to make sure your actions are matching your ultimate goals and strategy. This allows you to control your data quality, train your team effectively and give the whole business the assurance that AI can make a tangible impact on your operations.
“Taking the first step to develop a new strategy is hard, especially if you are working through your daily challenges. I would advise starting with a practice we call “exploration.” That means taking a break from the daily work and exploring new technologies (such as AI) or new customer segments. If you get into that habit, you will become much more open to embracing a new strategic approach.”
AI is an incredibly powerful tool for scaling and transforming your business, but its true potential can only be unlocked when it's aligned with your strategic goals. Whether you're looking to improve operational efficiency, offer responsive personalization, enhance quality control, or expand into new markets, the key is to start with clear business objectives and then map your AI initiatives to those targets. By doing so, you'll ensure your investments in AI directly contribute to growth. With the right approach, AI can be the catalyst that takes your jewelry or diamond business to new heights, ensuring you stay ahead in an increasingly competitive market.
This is the first in a series of articles in which we will be taking a closer look at all aspects of the potential transformative effect of AI. We look forward to sharing more in the coming months.
[1] https://www2.deloitte.com/us/en/insights/topics/digital-transformation/companies-investing-in-ai-to-generate-value.html
[2] https://www2.deloitte.com/us/en/insights/topics/digital-transformation/companies-investing-in-ai-to-generate-value.html
[3] https://www.mckinsey.com/industries/retail/our-insights/llm-to-roi-how-to-scale-gen-ai-in-retail
[4] https://aiexpert.network/prada-ai/
[5] https://www.accenture.com/content/dam/accenture/final/a-com-migration/additional-pages-1/pdf/pdf-149/Accenture-Solutions-AI-Customer-Engagement.pdf
[6] https://nationaljeweler.com/articles/12157-chatgpt-can-help-design-your-james-allen-engagement-ring
