Increasingly companies are leveraging on market dynamics to bolster their competitiveness, thus spurring enhanced profitability. Technology is one such area on which corporates are hinging their profitability. Fundamentally, the artificial intelligence (AI) domain of technology is causing revolutionizing the business landscape with companies which have adopted it already reaping big. For example, Etsy Inc., an online marketplace for craft products, is using machine learning technology from Google to drive its sales ( Castellanos, 2019 ). Principally, the company’s management understands that online sales have a direct relationship with the ranking of their website. Connectedly, as from 2017, the firm began shifting its resources to Google Cloud with AI being the core motivating factor ( Castellanos, 2019 ). From this strategic decision, Etsy Inc. is reaping huge sale returns, which are directly attributable to online search enhancements. Over the last two years, the company made an extra $260 in sales ( Castellanos, 2019 ). The use of context-specific AI algorithms to drive sales does not establish sustainable competitive advantage since other competitors can replicate such a technology in their operations.
The fact that Google Cloud can be used by any organization that wishes to move its resources online. Therefore, if any of Etsy competitors figure out that the company is making more sales through the AI capabilities of Google Cloud platform, they can also replicate, such as a strategic decision. Besides, through reverse engineering and modeling, the company's competitors can deconstruct its online marketplace search algorithms. Moreover, the business model of customizing its products according to a customer’s order can easily be used by other players in the same industry ( Castellanos, 2019 ). Hence, critically analyzing the company’s move to rely on AI to drive sales cannot sustain its market competitiveness.
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In conclusion, Etsy’s move to bolster its competitiveness and thus, sales through the use of AI-driven Google Cloud platform cannot sustain its market dominance for a long time. Principally, an AI algorithm can be figured out through reverse engineering methods, thus exposing a business's strong point.
References
Castellanos, S. (2019). Etsy Taps Google Cloud to Improve Search, Juicing Sales. Retrieved from www.wsj.com/articles/etsy-taps-google-cloud-to-improve-search-juicing-sales-11557785830?mod=searchresults&page=1&pos=15
