Successful entrepreneurship and innovation have always required a deep understanding of the needs, wants and goals of target customers. Until now, gaining these insights has been time- and resource-intensive, but the development of artificial intelligence is changing the game. By using AI tools, entrepreneurs can now analyze customer data at scale, gain valuable insights and make data-driven decisions.
Editor’s note: This article first appeared in Entrepreneur Magazine.
I am a professor of entrepreneurship at Babson College, where I teach forward-looking courses on AI and entrepreneurship and lead our AI lab. While some in business believe AI is overrated, the dawning age of AI will be a revolution for entrepreneurs—and my students—focused on exploring, understanding, and exploiting business opportunities.
AI can accelerate human creativity and curiosity and help entrepreneurs gain insights into what customers want and value. My research, industry work, and teaching at the intersection of AI and innovation show that AI capabilities are becoming increasingly important. Here’s why.
Using the superpowers of AI to scale insights
One of AI’s superpowers is its ability to synthesize massive amounts of data and quickly gain deeper empathy with customers.
Tools like Otter.ai can transcribe focus group sessions or customer interviews in seconds, allowing business owners to quickly identify unmet needs, pain points, and value creators. Sentiment analysis APIs like those from Microsoft Azure can identify emotional cues and tones in customer conversations that humans may miss. By aggregating this data over time, business owners can gain a deeper understanding of how customers feel about their brand, product, or service. That’s insight at scale.
MORE IN BABSON MAGAZINE: The Age of AI: Seven Things Entrepreneurs Need to Know
AI can also help entrepreneurs leverage the voice of the customer on a large scale. Customer feedback from various sources such as social media, product reviews, and customer support tickets can be automatically collected and analyzed using tools like MeaningCloud. By setting up automated workflows with platforms like Zapier, Business owners can streamline the process of collecting and analyzing customer feedback to identify recurring problems and opportunities for improvement and innovation.
AI can also help quickly iterate value propositions, such as for a website or key presentations to clients. Tools like Claude can help entrepreneurs quickly create variations of their messaging based on customer feedback. These variations can then be fed into platforms like Copy.ai to create compelling product descriptions that resonate with a target audience. By continually refining their messaging based on customer feedback, entrepreneurs can arrive at a compelling value proposition much more efficiently.
Customize the customer experience
Real-world examples show how important AI is when it comes to understanding and engaging customers. One of my best students at Babson University, Chloe Samaha, founded BOND, a virtual coffee chat app for remote and hybrid teams. The main purpose of the app is to help build company culture, employee satisfaction, and employee retention across distributed teams.
Their company uses the latest version of OpenAI’s ChatGPT to generate personalized, culture-specific daily questions that everyone answers and that drive employee engagement and retention. By analyzing engagement data, BOND continuously refines its AI model to deliver engaging content tailored to each company. Without ChatGPT, this level of customization at scale would not be possible. The results speak for themselves: BOND has enabled over 20 million moments of connection between colleagues and achieved an impressive 300% year-over-year revenue growth, highlighting the potential of AI to customize experiences that resonate with users and drive business success. BOND leverages the power of AI to gain insights.
As AI continues to evolve, its potential applications for entrepreneurship are limitless, especially for rapid prototyping of entrepreneurial ideas. ChaptGPT’s ever-improving ability to support text-to-code allows non-programmers to prototype their software ideas by simply describing them to an AI. And those who already know how to code can now do so five to ten times faster.
“The barriers between the digital and physical worlds are dissolving and we are entering an age of AI-enabled creativity that will both accelerate innovation and democratize entrepreneurship.”
Erik Noyes, co-creator of The Generator, Babson’s AI lab
In our AI lab at Babson, we’re developing new approaches to prototyping where students can 3D print a new product concept “extracted” from a 2D text-to-image model like OpenAI’s Dall-E or Midjourney. I expect that soon, students will only need to describe a prototype they want to create, and AI tools will help quickly turn those ideas into a voice-to-prototype experience.
The barriers between the digital and physical worlds are dissolving and we are entering an era of AI-powered creativity that will both accelerate innovation and democratize entrepreneurship. I see progress in all areas of AI quarter after quarter.
To stay ahead of the competition, entrepreneurs must use AI as a tool to better understand their customers. By using the right AI tools and platforms, entrepreneurs can gain deep insights into their customers’ needs, preferences, and moods. With this knowledge, they can make data-driven decisions, iterate faster, and ultimately develop products and services that truly resonate with their customers. The future belongs to entrepreneurs who can harness the power of AI to build customer-centric businesses.
Erik Noyes holds the Michael London and Stephen H. Kramer Term Chair in Entrepreneurship at Babson College and directs the interdisciplinary AI lab, The Generator. His research examines entrepreneurial thinking, AI-enabled innovation, and disruptive innovation in both startups and new companies.
Posted in Entrepreneurial Leadership, Insights
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