What Is AI Analytics, and Why Is It Important?

What is AI analytics?

AI analytics is the process of using artificial intelligence, usually machine learning, to automate and improve data analysis.

AI analytics tools are assisting fields from medicine and finance to advertising and manufacturing. Many businesses use AI to gain insight into their marketing data and make adjustments that optimize their return on investment (ROI).

But what is AI analytics, really? And how can you use it to assist with your marketing?

Let’s examine how AI analytics can transform your marketing strategy with detailed, automated insights for your campaigns:

• What is AI analytics?
• How does AI analytics work?
• Benefits of AI analytics
• Applications of AI analytics in your industry
• AI analytics tools to drive revenue

What is AI analytics?

AI analytics is a subfield of data analytics that use AI techniques like machine learning algorithms to extract valuable insights from large datasets. This process entails employing AI tools to automate data evaluation and interpretation, simplifying data-driven choices for businesses.

How does AI analytics work?

There are plenty of types of AI and different strategies for analyzing data. But, in short, here is how AI analytics works:

1. Gathering and processing data: The first phases in the analytics process are data gathering and preprocessing, which include preparing raw data for analysis by cleaning and organizing it.
2. Generating predictions: Next, you transfer this data to a machine learning model to identify patterns and generate predictions. The model will then produces insights that you can apply to improve corporate results and decision-making.
3. Implementing updates: Business leaders or marketing teams will then look at the reports and insights generated and implement the updates to improve campaigns.

Say you work in the retail industry and want to work on segmenting your marketing campaigns. You can use data like your customers’ purchase history, current inventory, and other data to generate personalized recommendations for shoppers.

Benefits of AI analytics

There are several advantages to integrating AI into analytics, and these benefits can change how your company runs entirely. The top four benefits of AI analytics are as follows:

• Real-time insights
• Improved decision-making
• Increased productivity and efficiency

Real-time insights

AI analysis offers real-time insights that you can use to make prompt, educated decisions.

Traditional data analysis techniques require collecting and analyzing data for days or weeks before you can discover any valuable insights.

By using AI-powered analytics, your organization can improve operations and supply chain management, reduce risks, and remain competitive. These insights enable you to react swiftly to shifting markets and spot fresh income possibilities as they materialize.

Improved decision-making

Your business can make more educated choices based on precise insights, thanks to AI algorithms analyzing massive volumes of data in seconds. AI decreases the possibility of human mistakes in decision-making processes while saving time.

AI also offers greater comprehension and insight into large data sets, since algorithms can see patterns and trends that humans might not notice. The result is more effective corporate- and industry-wide initiatives.

An ecommerce business can utilize AI-powered chatbots to offer immediate customer service and tailored recommendations, enhancing customer experience and boosting sales.

Increased productivity and efficiency

Fun fact: 60% of employees believe that AI will improve their productivity.

Using AI analytics, we can now accomplish in seconds what would have taken us hours or days to do previously. In return, businesses can devote more time and energy to other areas.

AI analysis can reveal information and provide suggestions that people would miss, resulting in even higher levels of productivity. Using AI in business processes leads to fewer inefficiencies, better decisions, and more growth.

You can use AI analysis to:

• Find ways to shorten workflows
• Identify trends and inefficiencies and recommend process improvements
• Save expenses on errors
• Boost marketing ROI overall

Applications of AI analytics in business

One of the most significant innovations is incorporating AI analytics into various business processes. Using AI enables your company to automate processes, improve customer experiences, and make choices based on data.

The following list of AI analytics applications in business illustrates how the sector is changing:

1. Improve customer experience
2. Optimize supply chain management
3. Enhance fraud detection

1. Improve customer experience

Improving the customer experience is one of the most useful applications of AI analytics in business.

AI can offer insights into customers’ wants and needs by examining their behavior and feedback. From there, you can make tailored recommendations and offers, enhancing their entire experience from start to finish. 

And, by customizing your sales and marketing initiatives, you’ll reach the right people at the right time with the correct message, leading to better profits. In fact, 90% of marketers think personalization significantly boosts profitability.

AI analytics can also assist in automating lead generation and scoring, allowing your team to prioritize their efforts and concentrate on the most promising prospects.

2. Optimize supply chain management

Your business can improve supply chain management and lower expenses by employing AI algorithms to evaluate data from sales, inventory, and logistics. AI analytics can assist you in demand forecasting, inventory management automation, and shipping route optimization.

You can make well-informed decisions that lead to a more effective, profitable supply chain by finding precise adjustments to changes in demand or supply.

AI also enables your company to locate and resolve possible supply chain bottlenecks, lowering the possibility of delays and disruptions.

3. Enhance fraud detection

AI analytics for marketing is not the only helpful use case. Fraud has emerged as a significant problem for organizations due to the growing reliance on digital transactions.

To prevent financial losses, AI analytics can sort through enormous volumes of data to enable proactive fraud identification and prevention.

AI-powered fraud detection systems use machine learning algorithms to spot trends and abnormalities in transaction data. They can then identify fraudulent behavior and warn organizations to act.

This process saves businesses money and improves client trust.

AI analytics tools for 2025

Businesses looking for a competitive edge are increasingly using AI analytics solutions. These technologies can assist you in finding patterns and trends in their data that might otherwise be challenging to see by utilizing machine learning algorithms and sophisticated data analysis methodologies.

Here are our picks for the top AI analytics tools in 2025: 

Google Analytics 4

Google Analytics 4 leverages AI for data analytics and insights. By using machine learning, GA4 can create predictive audiences, automate insights, and more. These AI-powered tools allow businesses to: 

• Better understand customer behavior 
• Condense large amounts of customer data and pull insights
• Find anomalies or sudden changes in traffic and sales quickly

IBM Watson Analytics

IBM Watson Analytics comprises many individual tools and programs for businesses, most of which focus on building and training AI models for custom use.

With IBM Watson, you can create and integrate AI analytics systems into your workflow that are custom to your needs and use cases.

Microsoft Copilot

Copilot for Microsoft Ads uses AI to help with ad creation, campaign analysis, and ROI management. With Copilot in Microsoft Ads, you get access to AI analytics in the form of:

• Narrative summaries
• Predictive models
• Visualized insights 

Businesses who use Microsoft Ads already can access Copilot in their platform and start using the AI analytics tool to get more out of their ad campaigns. 

Read: How To Use Microsoft Ads AI

Boost sales and performance with AI analytics technology

Our AI analytics technology — RevenueCloudFX — gives you access to valuable website performance insights and customer behavior.

RevenueCloudFX can examine huge volumes of data and find patterns in your marketing, customer, and sales data. Then, our team of over 500 specialists will review your website’s data and offer specific insights for improving your marketing strategy.

Contact us online or call 888-601-5359 to speak with a strategist and see how AI can integrate with your marketing approach!