India's current AI user base of 724 mn set to grow by 6% YOY: Kantar AI study

Internet in India is democratized and widely used; but now the country sits on the cusp of an AI revolution. ICUBE data shows that AI is already touching the lives of nine in 10 internet users in India, powered by the enormous computing capabilities on their phones, connectivity, and cloud infrastructure. Kantar, a marketing data and analytics business unveils a probe into this burgeoning AI market to dish out actionable insights for marketers. Furthermore, the company also unveiled an AI-powered suite of research solutions that will enable brands and brand builders to understand consumer behavioural data better and stay ahead of the curve in future.

The current AI user base of the country stands at 724 million and is 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. 

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 & entertainment apps will adopt AI features to enhance the 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.

Adoption of AI among users is currently high for popular features while enhanced AI functionalities are catching up. Incidence among AI users in 2023:

• 88 % of 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% of the consumer 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 other features. This segment grew at 5% YoY.

• At 21%, ‘smart home automation’ is a smaller segment but growing at 25% YoY.

• 15% of consumers enhanced their ‘user experience through virtual assistants’. This segment is the fastest growing at 27% YoY. 

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.

Speaking about AI and addressing the marketers, Soumya Mohanty, Managing Director & Chief Client Officer- South Asia, Insights Division, Kantar said “AI is inevitable. Historically, technology adoption has always been a dominant determinant of a brand’s trajectory. We at Kantar feel that it is important to help marketers humanize AI to innovate successfully, help activate AI to predict future performance, maximize ROI and use AI strategies to build competitive advantage for sustainable growth. We have created a range of offerings which will benefit marketers and consumers by extension. LINK AI is one such solution, which helps evaluate creative effectiveness at scale and has helped uncover new insights into creating better video ads on YouTube which has a proven track record of growth, following Google’s ABCD framework. Similarly, we have introduced best-in-class offerings like LIFT ROI, Trend AI and NeedScope AI for various stages of brand growth as well.” 

Puneet Avasthi, Senior Executive Director, South Asia, Insights Division, Kantar added “Generative AI is set to become a $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 that 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, and continue to focus on building equity and not just run activations. Kantar is at the forefront of this AI revolution and is assisting brand builders to strengthen creative testing, and innovation using its AI-based solutions.” 

The full report is available down below: