Pricing in B2B: will AI replace salespeople?
When will AI replace Sales Jobs in Pricing, and what can you do about it.
Will AI replace sales jobs? Short answer: no. Long answer: it depends.
Artificial intelligence replaces skills and tasks, not people. While AI for sales might be overhyped now, it still follows known rules of innovation. If some technology takes decades to change the way we work, it cannot be considered disruptive. Advances in AI are slowly eroding the bulk of manual pricing processes.
There are nowadays popular, specific applications of AI in B2B Sales. Using ERP data to predict pricing might be the one with the highest impact on earnings. Therefore, we can reformulate the question above: what tasks are a salesperson performing to price more intelligently?
AI cannot replace all tasks. Some are easy; some are hard. AI in B2B sales is gaining terrain by quickly replacing and supporting time-consuming and easy-to-automatise tasks.
Finally, what can we do about it? In the last part of this article, I would like to advise companies and sales professionals.
Let’s go through it.
Will AI replace sales jobs?
As with any form of automation, Artificial intelligence does not replace humans per se, but the jobs and tasks humans perform. Researchers define AI – weak AI – as the application of computing power to automatise and replace functions that people are doing.
Replacing tasks using computers is a matter of concern for both companies and individuals. Machines taking jobs away is profoundly ingrained in our culture. Automation has, in the long term, always takes over some jobs while creating others. In a short time, it only replaces tasks.
Just think about agriculture. Two hundred years ago, almost 98 % of the population of the United States was working on farms. Today, that proportion represents less than 2 %. Automation has replaced virtually all jobs. Automation also produces ten times more food.
The same is happening in any automotive factory across the world. Thirty years ago, mounting and welding were tasks exclusive to humans. Today’s robots and industrial automation perform those tasks instead. Robots still need to be programmed — the addition of artificial intelligence changes this equation. With AI, robots can see and decide for themselves.
Think of another example: logistics. A decade ago, most packages and goods were almost completely manually handled. Nowadays is the other way around. There are only a few jobs that are still too complex for machines to perform. For those, humans are still the preferred option.
What jobs are you performing to optimise pricing?
If you are concerned that artificial intelligence will replace your sales job, you need to think about it. A job is usually a combination of different tasks to be performed. What are the functions that you are performing? Are those tasks easy to automatise?
For example, writing an introductory email is not a complex task. There are algorithms already writing emails or even having basic conversations with customers. Think of chatbots. Fully implementing AI in CRM for pricing is not entirely different.
One can say the same can about dynamic pricing. Where humans used to calculate all the prices manually, now machines are taking over. Although some companies are still manually performing this task, algorithms have the upper hand if the available data and complexity are acceptable.
Predicting which customer could churn, buy more, or pay more is incredibly complex if you have more than 10,000 customers and 10,000 products. In that case, artificial intelligence produces better results, is faster and safer.
Is AI replacing salespeople yet? No. AI is only taking over some tedious tasks. What about the data analyst that are performing pricing calculations? Are they being replaced? Also no. Artificial intelligence automates their recommendations and next best actions.
What can you do now?
Once we understand the role of artificial intelligence and how this will impact sales jobs, we need to think about what we can do about it. You can follow different kinds of paths if you are a company, a manager, or an individual. Let me share some of my ideas.
If you are a company, you are in an arms race. Your competitors are already implementing automation in many other areas. Why not AI in sales and pricing? If your competitors, customers, and vendors use automation and enablement tools, you cannot lag. If you do, you are risking the survival of your company. There is no reason to panic. Just start using artificial intelligence in sales, where you have the data and solutions available.
If you are an individual, I can only give general recommendations. My first thought would be to learn about artificial intelligence and digitalisation in B2B sales. To that end, we are developing our Sales AI Academy (in German only). Do not stop there. I am sure there are many other good resources you can use to learn about Sales AI. Depending on the kind of sales jobs you perform, I recommend you familiarise yourself with the tools and software to make your sales job more efficient. Most of them are easy to test and to use.
Think and reflect about the kind of task and jobs you are performing. Repetitive simple tasks are easy to automatise – calculating a price, for example. Analytics is easy to automatise – predicting a price range. Reading the emotions of your customers and negotiating with them is not.
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Pricing decisions: can machines replace a B2B salesperson?
Yael Karlinsky-Shichor (Northeastern University) and Oded Netzer (Columbia University), researchers in the B2B field, recently demonstrated that a company could increase profits by 10 % by giving salespeople a predicted price. One clear argument for AI replacing humans.
Interestingly, Karlinsky-Shichor and Netzer also found that although a machine learning model leads to higher profitability most of the time, a salesperson can still beat the robot. Sometimes, salespeople can achieve higher profits when quoting clients with exceptional or complex attributes.
The researchers propose a hybrid pricing strategy: automatically combining a machine learning random forest with human expertise. This winning combination generates profits significantly higher than either the model or the salespeople.
When will AI replace your pricing tasks? AI is doing it already. Your sales Job? Not anytime soon. Your sales job is secure for as long as you (and your company) leave for AI what AI can do best and leave to you what humans can do best.
And may these two better works together.
I WANT PREDICTIVE ANALYTICS FOR B2B SALES.
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