Indian kids are loving AI making up the AI boom that every industry is eyeing

First it was the Internet, now it’s Artificial Intelligence (AI), Indian users are loving it. 9 in 10 Internet users in India are already using AI in some form or the other, according to Kantar AI research findings. Amongst the older age band (45+ year olds), 81% Indians already interacting with AI.

The current AI user base of the country stands at 724 million and poised to grow YoY at 6%. These are users who have used any of the AI features like image filters, personalized recommendations, smart devices, etc till now.

Read more: It’s time for emerging markets to wake up to the AI potential

Nitin Seth, Co-founder and CEO of Conversive, the new conversational messaging platform, told The Tech Panda, “I believe our demographics is the reason. And I think also younger people are adopting technology better.”

While AI technologies are touching most internet users of India today, their usage is expectedly higher among the youth (19–24-year-olds) at 92% and interestingly, at a high 81% for the older (45+ year old) age bracket as well.

“India has a huge demographic dividend. And any businesses are under a lot of pressure to serve and give good customer experience, which can be costly. That’s why AI is booming in India,” he adds.

The Deloitte report Generative AI in Asia Pacific: Young employees lead as employers play catch-up, highlights India’s exceptional response to Generative AI (GenAI), with 93% of students and 83% of employees actively engaging with the technology. Surveying 11,900 individuals in Asia Pacific, the report positions India as a frontrunner among 13 countries for GenAI use and adoption.

According to the survey, the robust adoption of GenAI has been driven by tech-savvy, young employees, known as “Generation AI,” who are driving GenAI adoption, presenting new challenges and opportunities for employers as they adapt to these changes. Per the report, “Generation AI” is leading the way in saving work hours, creating new skill development opportunities, creating more sustainable workloads and increasing productivity.

Kantar also found that ‘fitness’ and ‘social media’ apps are driving AI adoption with an average of 2.3 AI led features embedded in these applications. ‘Entertainment’ apps are a close second, standing at 2.0 AI features on average. AI is also touching ‘digital commerce’ and ‘pharmacy apps’ at an average of 1.8 AI features each.

Kantar also anticipates that many more digital commerce and entertainment apps will adopt AI features to enhance quality of customer experience and stay in line with emerging trends. Adoption however is slower in the ‘BFSI’, ‘job search’ and ‘short video’ apps segments, at an average of 1.2 features each. India is applying AI in recruitment, EdTech, Fintech, etc.

“Fintechs are deploying AI because they need to have the right margins. And they can’t employ a lot of people. So, a lot of fintechs are deploying, AI to screen and verify applicants,” says Seth.

Seth, who is in the customer communication sector, sees many companies looking to use AI to do the initial outreach and qualification. This means while they reach out to people and get a response they definitely want the first layer to be an AI driven chat bot. Only after the first contact, they funnel the customer towards a human agent.

AI is inevitable. Historically, technology adoption has always been a dominant determinant of a brand’s trajectory

Soumya Mohanty, Managing Director & Chief Client Officer- South Asia, Insights Division, Kantar

Soumya Mohanty, Managing Director & Chief Client Officer- South Asia, Insights Division, Kantar says, “AI is inevitable. Historically, technology adoption has always been a dominant determinant of a brand’s trajectory.”

As the usage of AI grows rapidly, it is critical for marketers to not use AI in isolation and as a gimmicky fad, but weave in consumer behavioural data into it to remove biases, continue to focus on building equity and not just to run activations

Puneet Avasthi, Senior Executive Director, South Asia, Insights Division, Kantar

Puneet Avasthi, Senior Executive Director, South Asia, Insights Division, Kantar added, “Generative AI is set to become a US$1.3T market by 2034 with a possible 42% CAGR growth over the next 10 years. We are sitting at a point of inflection where the next few years will enable a competitive edge between businesses who adopt early and others. As the usage of AI grows rapidly, it is critical for marketers to not use AI in isolation and as a gimmicky fad, but weave in consumer behavioural data into it to remove biases, continue to focus on building equity and not just to run activations.”

Read more: “The consumer in emerging markets should expect vast, radical change in everyday life soon because of AI”

Adoption of AI among users is currently high for popular features while enhanced AI functionalities are catching up. In 2023, 88% consumers used AI based algorithms which analysed their preferences, behaviours, and interests to create personalized recommendations for tailored experiences. This segment grew at 6 % YoY. 88% consumers also automated various tasks and streamlined routines to enhance efficiency and productivity in their daily lives using AI. This segment grew at 6 % YoY.

86% used ‘image enhancement filters’ so that the resulting image is improved in terms of sharpness, contrast, brightness or with other features. This segment grew at 5% YoY. At 21%, ‘smart home automation’ is a smaller segment but growing at 25% YoY. 15% consumers enhanced their ‘user experience through virtual assistants’. This segment is the fastest growing at 27% YoY.