Armed with the power of Artificial Intelligence, the real estate industry is poised for a radical transformation. Scott Bateman, CEO of Kolmeo, shows how AI is not just a tool, but the foundation of a revolutionary business model.
- Artificial Intelligence (AI) is now a necessity, not a luxury, in the real estate industry. It is a key determinant of competitiveness and relevance.
- The real value of AI lies not just in task efficiency but in the transformation of business models towards a digital-first approach.
- Successful implementation of AI requires a comprehensive rethink of business operations, culture, processes, and pricing models.
- Ant Financial serves as a case study for AI’s potential, with efficient operations serving a vast customer base with a relatively small team, showcasing the power of a digital business model.
- The challenge for businesses is not just adopting AI but fully reengineering to exploit its potential. This digital transformation is set to be a primary focus at the upcoming Elite Retreat 2023.
Picture yourself in a duel, armed only with a knife, while your opponent wields a gun. This old adage, warning of the perils of being ill-equipped in a contest, accurately captures the situation faced by the real estate industry in 2023.
The battle is no longer about traditional tools and methods; it’s a digital fight where artificial intelligence (AI) is the game-changer.
Failing to recognise AI’s transformative power could very well mean bringing a knife to a gunfight.
As we navigate the AI revolution, certain tools like ChatGPT have already evolved from a luxury to a necessity, transforming many sectors in front of our eyes.
The real estate industry, in particular, must not only adopt AI but fully embed it into its business models to stay competitive and relevant.
It was only a few weeks into 2023, AI technologies like ChatGPT and MidJourney became a part of everyday conversation, their applications sparking fascination and awe.
LinkedIn feeds overflow with innovations and ideas fuelled by AI, attesting to its growing prevalence and influence.
However, despite the buzz, many within the real estate sector fail to grasp the full potential these tools offer.
We often view AI as a tool to streamline tasks – for instance, writing copy for a property listing.
While this certainly brings efficiencies, saving an employee precious minutes, the true power of AI lies far beyond such isolated tasks.
The problem lies not in the lack of technology but in our inability to integrate it seamlessly into our business models.
Without a digital-first approach, we often fail to convert efficiencies into new revenue or reduced costs.
The issue is not merely about using AI tools but about redesigning our businesses to be digital at their core.
Consider Ant Financial, a Chinese financial services group that serves 1.3 billion customers with just 15,000 employees, thanks to AI.
Ant’s technology is so efficient that they need one employee for every 80,000 customers, compared to Westpac, which requires one employee for just 50 customers.
That’s the power of a digital business model.
Ant Financial has shown how AI can revolutionise business operations, drastically reducing the cost to serve while maintaining, if not improving, service quality.
This is a lesson the real estate industry can, and should, learn from. The question is, how can we compete when our cost to serve could be 1600 times less than it currently is?
How much capital could we save, and then reallocate towards fostering relationships with our customers, nurturing our core business?
Some may argue that AI adoption is expensive, complicated, and beyond the reach of many.
However, the reality of today’s digital landscape tells a different story.
The cost of AI has significantly decreased over the years, while its accessibility has increased.
Venture Capitalists see the potential, flooding the AI space with more than US$22 billion a year. Their investments are a testament to the perceived value and return on investment AI promises.
The real challenge, therefore, lies not in adopting AI but in reengineering businesses to fully exploit it.
In conclusion, to stay competitive, we all need to reimagine our businesses.
That includes rethinking our purpose, culture, operational processes, tech stacks, staff training programmes, and pricing models to adapt to the digital era.
We need to overhaul our analogue mindset and embrace a digital-first approach. It’s about harnessing technology to provide value, improve efficiency, and enhance customer experience.
The future of real estate, like any other industry, lies in transformation and innovation.
AI is not just an accessory we can ‘bolt on’ to our existing businesses. It’s a tool that, when integrated effectively, can reshape our business models, redefine our strategies, and drive our growth.
In the upcoming Elite Retreat 2023, we will explore these themes in-depth, focusing on digital business models and how to use them.
We’ll delve into the roles of your team in this digital era and how to foster a culture that thrives on innovation.
Moreover, we’ll examine the potential of margins, pricing, and profitability when AI and other digital tools are harnessed to their full potential.
In essence, the battle we face in the real estate industry is not one of mere survival. It’s a battle for supremacy, a race to the future where AI is the game-changer.
It’s not about bringing a knife or a gun to the fight; it’s about bringing a bazooka.