Advantage Archives

The Adaptive Advantage: Who’s Winning with AI and How

Wharton Human-AI Research and GBK Collective’s new report sheds light on the success of enterprise AI adoption and the challenges of turning it into significant business returns.

Measuring Growth Changes the Picture of AI Value

The report reveals how tracking growth measures leads to stronger positive AI returns compared to measuring efficiency alone.

AI Agents Are Common, Deep Integration Is Scarce

While AI agent adoption is widespread, deep integration into core business processes is limited, highlighting the importance of workflow transformation.

Clear Ownership Accompanies Stronger Returns

Organizations with a designated Chief AI Officer and a standardized AI platform show significantly stronger positive returns, emphasizing the importance of clear ownership and strategic planning.

Employees See a Different Transformation

The study highlights the disparity in perceptions of AI transformation between managers and entry- and mid-level employees, pointing to the need for improved training and support for widespread adoption.

What the Survey Can—and Cannot—Tell Businesses

The report provides valuable insights into AI progress within enterprise teams, emphasizing the importance of focusing on business outcomes, integration, accountability, and employee experience.

What is the Adaptive Advantage report by Wharton–GBK?
The Adaptive Advantage report by Wharton–GBK is a comprehensive study that examines how companies are using artificial intelligence (AI) and the return on investment (ROI) they are seeing from their AI initiatives.
What does the report reveal about the AI ROI gap?
The report reveals that while many companies are investing in AI technologies, there is a significant gap between those that are seeing a positive ROI from their AI initiatives and those that are not. This gap is referred to as the AI ROI gap.
Who is winning with AI according to the report?
The report identifies a select group of companies that are considered to be "winning" with AI. These companies are seeing a higher ROI from their AI investments compared to others, and they are outperforming their competitors in terms of revenue growth, profitability, and market share.
What factors contribute to the success of companies "winning" with AI?
According to the report, companies that are "winning" with AI tend to have a clear AI strategy, strong leadership support, a culture of experimentation and innovation, and a focus on ethical AI practices. Additionally, these companies are more likely to have a dedicated AI team and to invest in AI talent and technology.
How can companies close the AI ROI gap and improve their chances of success with AI?
To close the AI ROI gap and improve their chances of success with AI, companies should focus on developing a clear AI strategy, building a culture of trust and collaboration around AI, investing in AI talent and technology, and monitoring and measuring the impact of their AI initiatives. By taking these steps, companies can increase their chances of seeing a positive ROI from their AI investments and staying ahead of the competition in the rapidly evolving AI landscape.

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Perplexity’s Strategic Expansion into India’s AI Market

While OpenAI dominates the U.S. AI landscape, Perplexity is quietly embarking on an ambitious journey in India. The search-centric AI startup is successfully attracting millions of users in the world’s second-largest internet and smartphone market, gearing up for significant mass-market presence.

Exclusive Partnership with Bharti Airtel

In a significant move this week, Perplexity collaborated with Bharti Airtel, India’s second-largest telecom operator, to provide a complimentary 12-month Perplexity Pro subscription—valued at $200—to all 360 million Airtel subscribers. Airtel confirmed to TechCrunch that this exclusive deal prohibits other telecom providers from offering Perplexity’s services to their customers.

Global Expansion Strategy: Building Volume

The Airtel collaboration marks one of Perplexity’s most noteworthy actions as part of a broader global expansion strategy, which includes alliances with over 25 telecom companies worldwide, such as those recently established with SoftBank in Japan and SK Telecom in South Korea. Given India’s massive population, the startup sees unparalleled opportunities for growth not found in other regions.

Impressive Growth Metrics in India

Perplexity is witnessing remarkable success in India, with downloads skyrocketing 600% year-over-year to 2.8 million in Q2, according to exclusive Sensor Tower data shared with TechCrunch. In comparison, OpenAI’s ChatGPT observed a 587% rise, totaling 46.7 million downloads during the same timeframe.

The uptick in active users mirrors this growth; Perplexity’s monthly active users (MAUs) surged 640% year-over-year in Q2, while ChatGPT’s grew by 350%. India ranked as Perplexity’s largest MAU market last quarter, per Sensor Tower, although ChatGPT still holds a substantial lead with 19.8 million MAUs compared to Perplexity’s 3.7 million.

Comparison of Perplexity and ChatGPT growth in India — **Image Credits:**Jagmeet Singh / TechCrunch

Leveraging India’s Unique Market Dynamics

Building on prior partnerships, Perplexity aims to utilize India’s substantial user base to leapfrog over mature Western markets where OpenAI currently dominates in paid subscriptions. Earlier this year, it also partnered with Paytm, a leading Indian fintech, to integrate its AI-powered search into the Paytm app, boasting over 500 million downloads and ranking among the top three apps within India’s Unified Payment Interface.

CEO Aravind Srinivas’s Commitment to India

Perplexity’s CEO, Aravind Srinivas, has taken proactive steps to bolster the company’s presence in India. In January, he announced plans to hire an Indian executive, later pausing the initiative due to an “overwhelming” response to the job listing. He has since committed to a $1 million investment and dedicating five hours per week to boost AI initiatives in India.

Targeting Students and Tech-Savvy Users

Sources indicate Perplexity is also considering providing its AI search engine to Indian students to broaden its reach further.

Capitalizing on Limited Local Competition

A key factor for Perplexity’s focus on India is the relatively limited number of local AI startups in the AI search sector, paired with a large base of tech-savvy users. This dynamic has prompted even Google to introduce AI-focused search tools like AI Mode in India ahead of many other regions.

Monetization Challenges and Opportunities

Despite its growth, Perplexity faces significant challenges in monetizing its user base. It still trails far behind ChatGPT globally in revenue generation, despite both platforms offering a comparable $20 monthly subscription. ChatGPT’s in-app purchase revenue reached $773 million in Q2, reflecting a 731% year-over-year increase, while Perplexity reported an increase to $8 million, a 300% growth, as per Sensor Tower data.

Revenue comparison of Perplexity and ChatGPT — **Image Credits:**Jagmeet Singh / TechCrunch

Future Potential in an Evolving Market

In India, where consumers are known to be price-sensitive, Perplexity’s monetization strategy will require careful consideration. However, promising indicators exist. ChatGPT’s in-app purchase revenue saw an 800% year-over-year increase to $9 million in India during Q2. While Perplexity hasn’t captured notable in-app revenue yet, partnerships like the one with Airtel present opportunities for subscription growth in the short term.

Attracting Investment through User Growth

Strategic alliances in markets like India could position Perplexity favorably in front of investors who prioritize user growth and geographic diversification. To ensure sustained support, the startup must demonstrate the ability to convert its expanding user base into revenue streams.

Srinivas did not respond to requests for comment.

FAQs about Perplexity and Its Strategy in India

What is Perplexity’s main goal in India?
- Perplexity aims to establish a strong foothold in India’s rapidly growing technology market. By leveraging local talent and resources, the company seeks to innovate and compete effectively against giants like OpenAI.
How does Perplexity plan to compete with OpenAI?
- Perplexity is focusing on developing unique AI solutions tailored to the needs of the Indian market. This includes enhancing natural language processing capabilities and integrating AI into everyday applications, providing a niche that differentiates it from OpenAI’s offerings.
What advantages does India offer to Perplexity?
- India provides a vast pool of skilled tech professionals, a burgeoning startup ecosystem, and increasing investment in AI and technology sectors. This environment fosters innovation and collaboration, allowing Perplexity to accelerate its growth.
Are there specific sectors in India where Perplexity will focus its efforts?
- Yes, Perplexity plans to concentrate on sectors like healthcare, education, and finance, where AI can drive significant improvements and create impactful solutions that align with local needs.
What are the potential challenges Perplexity might face in India?
- Challenges include intense competition from both local startups and established global players, navigating regulatory landscapes, and adapting to diverse consumer preferences across regions in India.