Khaberni - Alibaba Group has confirmed that its substantial investments in artificial intelligence technologies within the e-commerce sector have begun to yield actual returns, as these projects have reached the financial breakeven point between spending and revenues, according to the company's vice president, Kaifu Zhang.
The company bets that artificial intelligence will be the main driver of growth over the coming years, despite market concerns about the surge in spending on technology compared to limited returns.
In February, "Alibaba" announced a plan to spend 380 billion yuan (about 53 billion dollars) over three years on developing cloud infrastructure and artificial intelligence technologies, according to a report published by "CNBC" and reviewed by "Al Arabiya Business".
Zhang, who oversees the applications of artificial intelligence in the company's e-commerce activities, stated that "Alibaba" has already launched a series of smart tools, which include enhancing search results to be more personalized for users, and improving the accuracy of the "virtual fitting" experience for fashion online.
Zhang's statements came days before the start of the major sales phase for "Singles Day," which is the biggest shopping event in China and equivalent to "Black Friday" in the West.
He noted that initial experiments showed a 12% increase in the return on advertising spend thanks to artificial intelligence technologies, a rate he described as "rare in this type of tests."
He added that the increasing integration of artificial intelligence on Alibaba's platforms will have a significantly positive impact on sales volume during this year's shopping season, which is concentrated on November 11.
Despite a relative slowdown in Chinese consumer spending in recent years, last year's "Singles Day" sales grew by 20.1% to reach 1.11 trillion yuan across Alibaba platforms such as "Taobao," "JD.com," and "PDD," according to the research firm "Sinton."
The e-commerce unit in China remains the largest source of revenue for the group, registering an annual growth of 10% in the quarter ended June 30, reaching about 19.53 billion dollars.
