By Aman Ghataura ,Alphagreen Head Of Operations
The CBD and AI markets are independently experiencing hyper-growth. As regulation further begins to open up in the Cannabis space, the relatively new yet blossoming European CBD industry is taking pointers from its silicon valley counterparts. The implementation of AI to help extract consumer data, accelerate research, and in turn, guide business decisions have made a substantial impact, to say the least. The UK market is expected to have reached nearly £1 bn pounds by 2025 – that’s a growth rate of over 18%.
To what degree is AI causing this massive growth?
AI Impact On Farming
AI is making almost every process within the agriculture system easier. Farmers are now able to rigorously measure and accurately analyze growth factors that play an enormous role – such as soil conditions, humidity, real-time weather forecasts, and a plethora of others. Previously, farmers didn’t have these capabilities. Now, AI can give them infallible analytics which proves to be integral in producing a healthy and full yield.
Much of this is possible through emerging technologies in agriculture such as specially designed drones that use image recognition AI to autonomously analyze crop health through visual imagery. The technology is best at identifying plant health in fields which bear a single type of yield. Companies such as Gamaya, Root AI, HelioPas AI, and numerous others are the guides for this story; their advancements in artificial intelligence have made all of this possible.
There are further AI opportunities in predictive breeding and strain selection. A data-driven approach can be taken to predict daughter plant features from parent features. This art becomes even more powerful when preferred strain features can be forecast five, ten, and twenty years into the future, and account for future environmental conditions.
AI Impact On E-Commerce
The consumer purchasing journey has changed dramatically with the advent of AI. Retailers are now able to recommend relevant products in an instant, dynamically change online shop merchandising and at scale help customers make better decisions with chatbots.
At Alphagreen, we’ve developed our tech stack to take advantage of the efficiencies that AI brings. This has enabled us to deliver many of our AI solutions to our B2C consumers on our CBD marketplace, and help other leading CBD brands implement these solutions under our tech-enabled services arm.
Sophisticated e-commerce stores can leverage AI search engines to help customers find their favourite brands and products by leveraging useful features. These include autocomplete queries, understanding synonyms and accurate responses to multi-lingual requests. The most impressive search engines are able to capitalise on consumer contextual data to change product results depending on customer personas, further improving conversion.
Some online retailers, including Alphagreen, dynamically adapt their shop window as a user interacts with it. Once a retailer builds a more in-depth understanding of what products a customer is in search of, AI tools can help surface forgotten products or those that may be of interest.
A key trait of a successful e-commerce store is Live Support for customers. Akin to a brick-and-mortar, leading stores devote significant resources to training and providing real-time customer service. With the advent of AI, it is possible for stores to handle traffic surges by provision of an AI chatbot to quickly respond to visitors and address queries.
AI Impact On Business Decisions
Analytics accumulated by AI tools are providing a wealth of information that can be leveraged to make better decisions. Through anonymising and aggregating transaction data, marketplaces such as Amazon, Alphagreen, and Farfetch have a unique viewpoint on consumer preferences when brands are competing on the same real estate. CBD brands, investors, service providers and even FMCG companies can then make data-driven decisions on where best to deploy capital.
Similarly, with pricing reports derived from marketplace data, market analysts can quickly measure how the CBD industry is growing, and inform key stakeholders how best to adapt product roadmaps and position themselves competitively.
Pricing and anonymised transaction data can also further improve the efficiencies of marketing teams. With knowledge on what type of customer is buying CBD products, marketing leads can segment their customers and tailor language that improves conversion, retention and customer happiness.
The Future of The CBD Industry
Consumer adoption of CBD in the UK has increased dramatically over the last year, with big retailers such as Tesco and Boots stocking CBD and retailers such as The Body Shop creating their own CBD skincare range. Covid-19 has catalysed the growth of the online CBD market with e-commerce penetration increasing significantly as brick-and-mortars close down and as consumers have become more health-conscious. Competition is fierce in the online CBD, health and wellness markets, and winners are responding to these challenges through the use of AI to improve consumer purchasing journeys.
For AI and CBD service providers, the scope for growth is immense. We expect this intersection of industries to continue to grow as AI incumbents tailor their offerings to CBD companies, and new startups are attracted to the wave of inflowing capital.