Retailers and banks are sinking more money than any other industry into artificial intelligence capabilities, according to a new study from the International Data Corporation.
The retail category as a whole will spend $5.9 billion this year on tools like automated customer service agents and product recommendation generators, while the banking sector is set to put $5.6 billion toward more security-oriented AI uses like fraud prevention and threat intelligence, according to the report. Total spending from businesses on AI is projected to reach nearly $35.8 billion in 2019—a 44 percent increase from last year—and $79.2 billion by 2022.
Discrete manufacturing, healthcare and process manufacturing rounded out the report’s top five.
The retail industry’s investment in AI comes as ecommerce companies struggle to compete with Amazon’s personalized recommendation and pricing algorithms and increasingly cut out traditional retailers to sell directly to consumers. Efficiency in such a cutthroat environment requires the constant processing of customer and transaction data often made possible by machine learning.
Meanwhile, banks see AI as a means to cut costs and beef up effectiveness around expensive security and compliance operations, which are complex but quantitative enough for AI functions to handle.
All told, the top-funded use cases included automated customer service agents ($4.5 billion worldwide), sales process recommendation and automation ($2.7 billion) and automated threat intelligence and prevention systems ($2.7 billion). Automated preventative maintenance, diagnosis and treatment systems, fraud analysis and investigation, intelligent process automation and program advisors, and recommendation systems all garnered more than $2 billion as well.
More broadly, around 17 percent of all spending will go toward software applications of AI, 16 percent to hardware construction—mostly computer servers—and the rest will fund information-technology functions, consulting services, talent and various other labor and service expenses.
“Significant worldwide artificial intelligence systems spend can now be seen within every industry as AI initiatives continue to optimize operations, transform the customer experience and create new products and services,” Marianne Daquila, IDC’s research manager of customer insights and analysis said in a statement.