The global artificial intelligence (AI) market size is expected to reach US$169 million in 2025, from $4 million in 2016, growing at a compound annual growth rate of 55.6% from 2018 to 2025, according to Valuates Reports.
Artificial intelligence enables computers and machines to mimic the perception, learning, problem-solving, and decision-making capabilities of the human mind.
Valuates Reports says that AI is positioned at the core of the next-gen software technologies in the market. AI has several industrial applications where production plants can operate without human supervision. AI-enabled applications in the industries are expected to improve efficiency and aid saving of time.
The research group’s study shows that trends influencing the AI market are:
- Growing e-commerce, streaming content, and growing internet penetration has led to growth in the marketing industries. Marketers are now searching for more innovative and state-of-the-art marketing solutions for a consumer base that is constantly growing. This has culminated in the adoption of marketing solutions powered by AI.
- Organizations are trying to analyze consumer data from CRM systems, product reviews, and media commentaries in order to understand their consumers at a granular level, making their ads more focused and effective. With more data being generated across various industries, analyzing the data to get valuable information becomes crucial in making an organization operate successfully. AI helps analyze the data, gain valuable insights, and detect anomalies. These features of the AI are expected to fuel its adoption and, in turn, increase the AI market size during the forecast period.
- In the retail industry, the application of AI will enable more sophisticated supply chains, a deeper understanding of consumer preferences, and the ability to customize products and purchase experiences both on- and off-line. Furthermore, AI technology will help retailers focus on trend creation and preference formation/brand building. This adoption of AI in the retail industry will increase the AI market size.
- Increasing R&D investments by leading players will also play a crucial role in increasing the uptake of artificial intelligence technologies.
- The increasing adoption of autonomous vehicles and EV’s are expected to increase the AI market size during the forecast period. In the automotive industry, AI has many applications, including Advanced Driver Assistance Systems ( ADAS). Neural networks are widely adopted in lane detection vehicles, which facilitate the replacement of expensive sensors.
- The rising investments in AI technologies by various private organizations is expected to increase the market size during the forecast period. As AI technology is still in its early stage of the product life cycle, the workforce possessing in-depth knowledge of this technology is limited. Thus, the impact of this restraining factor will likely remain high during the initial years of the forecast period of the AI market.